OREANDA-NEWS. June 5, 2012. The workshop “Emerging Market Green Credit Forum” jointly held by China Banking Regulatory Commission (CBRC) and International Finance Corporation (IFC) was convened in Beijing on May 16. Li Renjie, President of Industrial Bank (IB), indicated at the conference that green credit and green finance businesses would not only be a market with great potential and important orientation for the business development of commercial banks in the future, but more an important grab to propel the transformation of commercial banks. In recent years, the non-loan financing has accounted for a big proportion in the green financing handled by IB.

Li said that IB was one of the commercial banks exploring and getting involved in the field of green credit at an early time in China. Since 2005, IB has got involved in the field of green credit. For seven years, IB has, based on exploration and practice, deeply understood that green credit and green finance would not only be a market with great potential and important orientation for the business development of commercial banks in the future, but more an important grab to propel the transformation of commercial banks.

He said that IB had pushed forward the green finance business with experience in three aspects. First, the bank vigorously drove the profound reform of banking business concept. According to Li Renjie, when launching cooperation with IFC regarding energy-efficient financing projects in 2005, we only had a hazy understanding generally, more based on the intuition to the market and consideration of performing corporate social responsibilities. Then, with the vigorous growth of relevant businesses, the sustainable development of green finance reached to the level of our board of directors, becoming an important part of our banking development strategy, a sign for the major reform in the business concept of IB. Thanks to the reform and sublimation of business concept, our transformation strategy was implemented and executed more vigorously.

Second, green finance could boost the overall trimming and reconstruction of process es and regulations of banking businesses. “The sustained and in-depth development of green finance business represented by green credit is, as a matter of fact, a process of reforging the organizational structure, business process and regulations of the bank in an all-round way.” He summarized that the development of green credit and green finance business had powerfully drove the reconstruction and improvement of the bank's conventional business process, especially the credit process, greatly improved the overall risk management level of the bank including environmental and social risks, and provided strong support and guarantee for the smooth progress of strategic transformation of the bank.

Last, green finance could boost the sustained innovation of relevant businesses of banks powerfully. By now, in the field of green finance, IB has established three main business sectors: energy-efficient financing, environment finance, and carbon finance. And two product series are included: green finance financing service and emission rights finan cial service.

Li indicated that the innovative development of green finance service had also pushed forward the development of emerging businesses including underwriting and issuance of bonds, structure financing, financial lease, trust, etc. In recent years, the non-loan financing has accounted for a big proportion in the green financing handled by IB. For instance, various green financing projects handled by the bank have totaled RMB 87.1 billion since 2011, with the non-loan financing accounting for 30%.