The bank provided a sustainability-linked loan to Sembcorp Marine, which refers to Singapore’s average overnight rates.
The $ 500 million sustainability finance facility, considered the first in the industry, will help the shipping giant embrace cleaner, greener and renewable energy solutions, the two sides said in a joint statement Thursday.
The loan interest rate includes a compounded daily SORA rate calculated in arrears and an applicable margin. The loan includes interest rate reductions linked to predetermined environmental, social and governance (ESG) objectives, which are aligned with Sembcorp Marine’s performance objectives defined in the group’s sustainability report.
Reduce environmental impact
“The inclusion of green finance aligns with our strategic transformation and our linchpin since 2015 to provide innovative engineering solutions to the global offshore, marine and energy industries.” Guillaume Goh, said the CFO of the Sembcorp Marine group.
In 2019, some S $ 530 million of Sembcorp Marine projects were linked to green solutions. The company has also introduced greener features in its operations, such as using solar power to reduce emissions.
Green target
“As a goal-oriented bank, we believe that financial institutions have a strategic and central role to play in proactively supporting industries in their work towards a low carbon future,” Dorian Delteil, said DBS’s oil and gas official.
DBS recently increased its commitment to fund S $ 50 billion worth of renewable, clean and green energy projects by 2024, up from S $ 20 billion previously.
