RHB structure of ESG financial products

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PETALING JAYA: RHB Banking Group successfully structured the country’s first Green Cross Currency Interest Rate Swap transaction against key performance indicators (KPIs) related to environment, society and governance (ESG) for cover an amount of $ 100 million (RM 423 million) from two sustainable loans over one year.

In a statement released yesterday, the bank said the transaction further solidifies RHB’s commitment to bolster the growth of the rapidly evolving ESG landscape within Malaysia’s banking industry.

He pointed out that the KPIs for the Green Cross Currency Interest Rate Swap are linked to RHB’s green finance commitment of RM5bil in support of green finance by 2025, which involves the group’s core lending activities. , capital markets and advisory as well as investment.

“The structuring and successful execution of the first green currency interest rate swap transaction in Malaysia is driving sustainable value creation for our stakeholders and underscoring RHB’s position as a leader in the derivatives market. ESG.

“With the growth of sustainable investing, we are also seeing a growing demand for derivatives, specifically linked to ESG KPIs and where returns are linked to performance and sustainability goals.

“This first-to-market transaction marks the start of our journey in developing customizable, sustainability-related derivative transactions using measurable KPIs,” said RHB Group Managing Director (MD) and CEO , Datuk Khairussaleh Ramli.

He said the move would promote climate action and the adoption of sustainable practices leading to realizing real impact and change in the real economy. He added that the banking group is committed to adopting green considerations throughout its financial services supply chain.

“It also gives our clients quick access to sustainable hedging solutions to manage their fundraising activities more efficiently and further contributes to our vision of creating a positive impact through our business operations as a responsible financial services provider,” did he declare,

The Green Cross Currency Interest Rate Swap was executed with Standard Chartered Bank, which illustrates RHB’s commitment to supporting the growth of the green economy by encouraging its stakeholders, including customers and business partners, to adopt more sustainable business practices.

RHB said a total of RM 3.79 billion has been extended to green activities by the group, of which 19% is attributed to renewable energy projects in September 2021.

“We are honored to work with RHB to provide such a solution to the Malaysian financial market. Supporting sustainable and responsible growth, including the achievement of the United Nations Sustainable Development Goals and the transition to net zero, represents an important opportunity for us.

“Collaborations with partners such as RHB will help promote the adoption of sustainable practices,” said General Manager and CEO of Standard Chartered Malaysia, Abrar A Anwar.

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