Recently, Industrial and Commercial Bank of China (“ICBC”) issued RMB10 billion of carbon neutrality-related green financial bonds in the Chinese inter-bank market. This is the first domestic issue of such bonds from a Chinese commercial bank.
The three-year bonds will raise funds mainly for green industrial projects with significant reductions in carbon emissions. The reserved projects include wind power generation and other clean energy ones which meet the requirement of having “measurable, examinable and verifiable” carbon emissions reductions. According to the estimates by a green certification agency, the funded projects can annually reduce approximately 3.5 million tons of carbon dioxide emissions, as well as a large number of emissions of sulfur dioxide, nitrogen oxides and other noxious gases and soot, benefiting the environment remarkably.
This is the first issue of bonds where the IPSF Common Ground Taxonomy jointly formulated by China and EU countries has been cited in the domestic bond market, demonstrating the credibility of the bonds in the international green bond market. Attracting great market attentions, the bonds have been subscribed actively by various investors with nearly 3 times subscription rate.
In recent years, ICBC has been actively practicing the new development concept and advocating green finance to promote the real economy. Through continuous financial innovation, the Bank has led the market in the issuance, underwriting and investment of green bonds. This issue of bonds is another move ICBC has taken to practice greenness and sustainability and help achieve the strategic goals of carbon peak and carbon neutrality.