HSBC Vietnam will provide a green loan in phase one of the Duy Tan Plastic Recycling Factory project, which will require a total investment of up to $60 million USD by the Duy Tan Plastic Production Joint Stock Company (Duy Tan).
This will be the first green credit arranged by HSBC for a Vietnamese company out of a total of US$100 billion pledged by the bank to be used for sustainable financing and investment globally until 2025. As of the end of 2019, the bank had provided $52.4 billion in loan and sustainable investment financing.
The HSBC green credit financing program also aligns with the Vietnamese government’s national green growth strategy and the State Bank’s green banking development strategy.
The construction of Duy Tan’s plastic recycling factory is divided into three phases, with a total investment capital of $60 million USD. The green credit provided by HSBC to Duy Tan is the first step in the project’s first phase. After a year of operation, Duy Tan and HSBC will jointly re-evaluate the factory’s performance, make a decision to adjust, receive advice, and continue financing.
The factory, which will have a capacity of up to 100,000 tons per year, will also be the first in Vietnam to use the recycling technology “Bottles to Bottles.” Duy Tan’s project has gone through HSBC’s rigorous credit management and approval process for sustainable finance, which is overseen by HSBC’s Sustainable Lending Committee in Asia-Pacific, to receive this green credit funding.
According to data from the State Bank of Vietnam by the end of June 2019, outstanding credit for green projects is 310,600 billion VND, up 29% compared to 2018. Green credit balance mainly focuses on the field of green projects.
Green credit loans are primarily focused on green agriculture, accounting for 46% of total outstanding loans, renewable energy, clean energy 15%, and sustainable water management in urban and rural areas 11%. Sustainable forestry accounts for 5% of the total green credit balance.
HSBC is currently offering green credit for a variety of projects aimed at both individual and corporate customers. In particular, in 2019, HSBC launched green credit to assist individual customers in borrowing funds to install rooftop solar power systems. HSBC is also sponsoring a green office building in the heart of Ho Chi Minh City for corporate clients.