OCBC launched the OCBC 1.5°C loan product in 2023 to support corporates in their transition to net zero. It offers reduced interest rates to corporates that meet annual decarbonisation performance targets aligned with science-based decarbonisation pathways for achieving net-zero level greenhouse gas emissions by 2050.
In December 2023, the bank arranged its first such loan, a three-year GBP 200 million sustainability-linked loan for City Developments Limited (CDL), a leading global real estate development, investment, and management company. Its proceeds will be utilised for refinancing, general corporate funding and working capital purposes.
As part of the loan terms, CDL will enjoy interest rate reductions upon meeting pre-agreed levels of annual decarbonisation performance that align with its SBTi (Science Based Targets initiative)-validated decarbonisation targets for 2030.
As the sole sustainability advisor for this transaction, OCBC’s engagement with CDL demonstrates the bank’s commitment to supporting clients in their climate transition journeys. Working with corporates that take up the OCBC 1.5°C loan will enable the bank to gain greater insight into clients’ transition strategies and progress on targets.
This insight will enhance OCBC’s capacity to support clients’ transition plans with tailored advisory and financing solutions, while simultaneously enabling the bank to more accurately assess its financed emissions and measure progress towards its own net-zero targets.
Read more on OCBC’s net-zero targets here.
This case study was originally published in the Net-Zero Banking Alliance 2024 Progress Report (October 2024).
Disclaimer: NZBA shares case studies to promote member banks’ awareness of new approaches, tools, products, services, and transactions related to financing the transition to net zero. Featuring a case study naming a particular bank does not represent an endorsement of all actions from that bank.