Bank of Jiangsu
In recent years, green lending has not only been embraced by national banks in China, but also gained traction with socially responsible and environmentally conscious regional commercial banks. Bank of Jiangsu, which operates in the eponymous eastern province, has emerged as a leader among regional commercial banks in both green-credit provision and the adoption of international green-lending best practices.
Bank of Jiangsu was incorporated in Jiangsu’s provincial capital of Nanjing in 2007. Five years later, it started to offer green credit for energy efficiency and renewable energy development projects with the IFC as an adviser. At the beginning of last year, the bank led its peers by creating a separate business unit and a dedicated team for green finance.
After several years of sustained effort to expand its green-finance portfolio, the Bank of Jiangsu’s green lending has shown robust growth. By the end of 2016, the balance of its green credit increased to Rmb46.7 billion ($6.8 billion), or 9.1% of the bank’s total corporate lending, from Rmb6.5 billion or 1.9% of total corporate lending at the end of 2013.
This year, the bank passed a milestone in green finance. In January, with the IFC’s support, Bank of Jiangsu became the first regional commercial bank in China to adopt the Equator Principles, a risk-management framework adopted by financial institutions globally for determining, assessing and managing environmental and social risk in lending activities.
“Bank of Jiangsu’s adoption of the Equator Principles and joining the family of Equator Banks reflects not only our resolution to embrace green concepts and develop green finance, but also our expectation to help our clients realize their sustainable development goals through a more scientific and reasonable approach,” says Xia Ping, chairman of Bank of Jiangsu.
The second-largest provincial economy, Jiangsu has one of the most vibrant industrial sectors in China and offers vast potential for Bank of Jiangsu in terms of green lending. By engaging the environment protection department of Jiangsu provincial government as a strategic partner, the bank has set out to launch green-finance investment funds, as well as green loans backed by carbon credits of industrial enterprises.