Two foreign banks to provide loans through carbon-reduction supporting tool

Xinhua

Beijing: The People’s Bank of China this week said that two foreign lenders have been added to the list of financial institutions that can provide firms with low-cost loans through a supporting tool for carbon emission reduction.

Deutsche Bank (China) Co., Ltd. and Societe Generale (China) Ltd. are the two banks that have just received the nod, the central bank said.

The move shows that China attaches great importance to green transformation, adheres to opening-up, treats foreign financial institutions as equals and supports their development in the country, the central bank said.

The supporting tool was rolled out in November last year by the central bank and two other central government departments to provide low-cost loans for financial institutions and support them in giving loans to firms in key carbon-reduction fields.

The central bank adopts “the system for direct funds,” which means financial institutions can apply for this low-cost funding from the central bank after the loans for carbon reductions are made.

The central bank will provide financial institutions with funds equal to 60 percent of a loan’s principal at an annual interest rate of 1.75 percent through the tool.

China has announced that it aims to peak carbon dioxide emissions before 2030 and achieve carbon neutrality before 2060.