The RMB 1 billion SLL also represents the first in the Chinese pulp and paper industry
SINGAPORE – Media OutReach – 18 May 2023 – Royal Golden Eagle (“EGR”), a global group of resource-based manufacturing companies, has announced that its member company Asia Symbol (Shandong) Pulp and Paper Co., Ltd. (“Asian Symbol“) – a world leading producer of pulp and paper – has signed a first-of-its-kind sustainability-linked loan (“SLL“) of RMB 1 billion with a consortium of several Chinese banks. Led by the Agricultural Bank of China, the consortium includes the Export-Import Bank of China, Bank of Communications and China Merchants Bank.
Representing the first in the Chinese domestic pulp and paper industry, Asia Symbol’s latest SLL will play an important role in promoting the development of the Chinese real economy through innovative green financing. It also supports the Chinese government’s aim to achieve its national “dual carbon” goals.
Interest rates for the SLL will be tied to five key performance indicators (KPIs) – reduction of atmospheric pollutant emissions and water consumption, improvement in water recycling rate and alkaline recovery rate, as well as creation of new job opportunities. A reputable third-party environmental certification agency will issue a certification report and verify the annual assessment results. Asia Symbol will benefit from lower interest rates if it meets the specific and measurable KPIs in the agreement within the next three years.
At the signing ceremony, Mr. Jun Yang, Vice President, Investment Banking Department of the Agricultural Bank of China said that the SLL has a clear positioning and efficient execution. The KPIs were designed based on three sustainable development directions, namely clean production, circular economy and social responsibility. The SLL created a “double firsts” record of a foreign-funded enterprise securing a SLL from a consortium of Chinese banks; it is also the first SLL in the domestic pulp and paper industry. Mr. Yang added that the Agricultural Bank of China is fully implementing a green finance strategy.
Mr. Langen Shu, Vice President of RGE, China, said: “RGE has always adhered to sustainable development. RGE China aims to achieve a 30% reduction in carbon emissions by 2030. The green finance strategy of the Agricultural Bank of China is highly consistent with RGE’s ESG business model. Our collaboration underscores the shared commitment to generate high quality and sustainable growth in China. We hope that the SLL can encourage more partnerships between banks and corporates and provide a viable model for the sustainable transformation of traditional industries.”
Among the first non-property corporates in Singapore to tap the growth of SLLs, RGE has been making notable progress in moving the bulk of its financing to green and sustainable ones. In 2022, RGE raised a total of US$1.6 billion in SLLs for its various business groups. RGE uses the SLLs to crystalize its sustainability KPIs while lowering the cost of financing upon achieving the KPIs that are tied to the SLL. In 2022, RGE raised its first green loan as well as carbon asset backed financing in China which was also the first foreign-owned carbon finance deal in the country. The support from RGE’s banking partners have shown their recognition that it is possible for resource-based businesses to produce from the land and protect it, with positive results for business and nature. Specific and measurable ESG targets are embedded in the SLL terms to align with banks on a common sustainability journey.
The issuer is solely responsible for the content of this announcement.
Source: Media Outreach Newswire