Hua Nan Commercial Bank of Taiwan Adopts the Equator Principles
Advancing the Fulfillment of Sustainable Finance
To enhance environmental and social (E&S) risk management along with the global financial industry and to assist corporate partners moving towards sustainable operation, Hua Nan Commercial Bank of Taiwan (HNCB) officially announced that it has adopted the Equator Principles on June 15, 2022 and has become one of the global Equator Principles Financial Institutions (EPFIs) by joining the Equator Principles Association. In the future, HNCB will work together with corporate partners to fulfill the spirit of ESG and sustainable finance through incorporating the Equator Principles into its credit management system.
The Equator Principles is a risk management framework, adopted by financial institutions, for determining, assessing and managing environmental and social risk in projects and is primarily intended to provide a minimum standard for due diligence and monitoring to support responsible risk decision-making. HNCB has formulated “Sustainable Lending Principles” to incorporate ESG-related considerations into the lending process, and made a negative list of loan customers. HNCB would only undertake loans which have been evaluated as posing no adverse effects on ESG development. After joining the Equator Principles Association, HNCB will assess the E&S risks of project financing and project-related corporate loans, and conduct regular follow-up monitoring to avoid causing major risks to the environment and the society.
Climate change has posed more and more severe risks to the industries, and has become a challenge to corporates around the world. Thus, it is important that the financial industry make an influence of capital and be the driver for industrial transformation. HNCB is committed to connecting domestic enterprises to global network and achieve innovation and industrial transition. Hence, it continues to promote products such as ESG index linked loans, green financing, 5+2 innovative industries plan lending, green bonds, and increases investments in green industries. As of the end of April 2022, the balance of investment in green bonds has reached NTD 12.6 billion, and the balance of loan in green industries has reached NTD 360 billion. HNCB continues to lead the industry to jointly direct capital to companies that are conductive to environmental and social development through syndicated loans. Since 2021, HNCB has undertaken more than 20 project finance deals related to sustainable development with an amount of more than NTD 30 billion. In recent years, HNCB has actively exerted the value of sustainable finance. In addition to winning the "109 National Sustainable Development Award - Enterprise Category," HNCB also won the "2021 Excellent Financial Service Award," the highest honor of solar photovoltaic, becoming the first state-owned banks to be awarded.
Joining the Equator Principles Association is an important milestone for HNCB on our way to sustainable development. In the future, HNCB will actively align with the global trends in sustainable finance, and keep up with the spirit of integrity, enthusiasm, and innovation. In addition to achieving the sustainable development of the banks’ operation, we will further guide the industry to gradually carry out low-carbon transition, enhance industrial resilience, and bring positive value of sustainable inheritance to the society with our professional financial services.