CIMB allots $730m for corporate sustainable loans

Borrowers will receive interest rate rebates upon reaching pre-agreed targets.

CIMB Bank is allocating US$730m (MYR3b) for its sustainability-linked loans (SLLs) to corporate borrowers interested in boosting their sustainability performance, according to a news release.

The bank would be one of the first in Malaysia to offer this proposition with the aim of facilitating and supporting environmentally and socially sustainable economic activities.

SLLs are financial instruments where the borrower receives incentives, in the form of interest rate rebates, upon reaching pre-agreed Sustainablity Performance Targets (SPTs).They are guided by the Sustainability Linked Loan Principles 2019 issued by the Asia Pacific Loan Market Association.

Availability of the incentive is from 1 January 2020 to 31 December 2024.

In October 2019, CIMB priced its US$680m (MYR2.7b) Formosa & Reg S Sustainable Development Gpals (SDG) Bond, with proceeds channelled to eligible assets under the seven SDGs to which the bank has committed.