By Amin Amirkia
On February 24, 2012, the China Banking Regulatory Commission (“CBRC”) introduced a new Green Credit Guideline (“Guideline”) in order to encourage commercial lenders to facilitate loans to “green” enterprises. The CBRC, China’s top banking regulator, ordered commercial lenders to cut loans to industries with high-energy consumption and high levels of pollution or excessive capacity, and to strengthen financial support for environmentally friendly industries and projects.
The CBRC encouraged banks and financial institutions to evaluate, classify and rate the environmental and social risks in their clients’ businesses and to take such results as a key reference in their ratings and access to credit. It has been reported that the CBRC will, as a next step, establish key indexes in order to make the Guideline more specific.