Pan Asia Bank completes $20 mln funding from Europe-based financier
View(s):Pan Asia Banking Corporation PLC (Pan Asia Bank) in its mission to contribute towards helping to create a climate friendly economy has embarked on a green lending drive to fund small, medium and large scale renewable energy and energy efficiency project, a media release by the bank said.
“To this end, the bank has completed a funding arrangement with the Europe based green financier, the Global Climate Partnership Fund (GCPF) to obtain a refinancing facility of US $ 20 million (Rs.2.8 billion) for green lending activities. In view of our strong balance sheet and also proven ability to focus on funding small, medium and large scale green projects, they (GCPF) have indicated willingness even to commit much larger refinancing facilities to us (Pan Asia Bank),” Deputy General Manager, Treasury, Richie Dias was quoted as saying. The release said that the bank is on the green lending drive and is also to assist the government to achieve its national energy objective of increasing the share of renewable energy up to 20 per cent of the energy portfolio by 2020 based on power generation.
“Expanding their mission to further reduce Sri Lanka’s carbon emissions, Pan Asia Bank has now diversified its green lending portfolio in to areas such as solar, wind and hydro power generation,” the release said. According to Mr. Dias, any energy saving project or a trade which minimizes the carbon foot print significantly, could now apply for facilities under this loan scheme.
“When we initially started green lending few years ago, the biggest challenge we had was to design products which are in line with green concept and to educate the market on the availability of green financing because this was something new to this market back then. Today the hybrid market is matured but the renewable energy generation financing market is still in its infancy. So, now we are looking at diversifying our portfolio in to these areas which have a significant potential,” he was quoted as saying.
The release said that one significant benefit that the borrowers receive from green lending is the lower interest rates that they can enjoy compared to conventional borrowing. “This special benefit is offered in view of the fact that funds are expected to be used in environmentally friendly projects which have minimum environmental impact. Meanwhile the borrowers also have the option of choosing between fixed rates and floating rate depending on their risk appetite.”