Presented at the 4th Global Infrastructure Basel Summit 21 & 22 May 2014. Read more about the world leading platform for Sustainable Infrastructure Finance at www.gib-foundation.org. Next Summit: 27 & 28 May 2015 in Switzerland

1. The Practice of Green Credit in ICBC
Yin Hong
2014.05.22

2. Content
3.Typical Cases
1.Overview
2.Green Credit System
1.Overview
2.Green Credit System
3.Typical Cases
1.Overview
2.Green Credit System
1.Overview
2.Green Credit System
3.Typical Cases
1.Overview
2.Green Credit System
1.Overview
2.Green Credit System
3.Cases
1.Overview of ICBC Group
2.Green Credit System

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1.1 History
 incorporated in 1984
 wholly restructed to a joint-stock limited company in 2005,
 listed on stock exchange in Shanghai and Hongkong in 2007
ICBC LIMITED

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1.2 Main Indicators
 One of the top large banks in the world
 Customer base
4.735 million corporate
432 million personal customers
 Diversified business structure
 Network
17,245 domestic institutions
329 oversea institutions
1903 correspondent banks
Online banking, telephone banking
and self-service banking
 The most profitable bank in the world.
Net profit: $43.38 billion
 The largest bank in the world.
Total Assets $3.12 trillion
 ROA(1.44％) and ROE(21.92％)
Outperform Peers
 Excellent Assets Quality
 NPL ratio 0.94％
Allowance to NPL 257.19％

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1.3 International Awards
In 2013，ICBC has won 51 international awards and 168 domestic
awards.

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1.4 Awards in Green Finance
 The Bank strives to realize the integration of economic and social
responsibilities, establishing the image of a large responsible bank in
the aspects of supporting economic and social development, protecting
environment and resources, and sponsoring public interest activities.
 “Best Social Responsibility Financial Institution Award of the Year”
 “Most Responsible Enterprise”
 “The Listed Company Green Finance Award”
 “Environmental Responsibility Leading Financial Award”
 Green Financial Innovation Award
 The National Energy Saving Advanced Collective
--In 2012,ICBC joined the United Nations Global Compact
--Currently ,ICBC is being on procedure to join the UNEP FI.

7. Content
1.Overview
2.Green Credit System
1.Overview1.Overview1.Overview1.Overview1.Overview
3.Cases
1.Overview
2.Green Credit System

8. -8-
2.1 Green Credit Framwork
 Stratege----direction
 Policy----map
 Classification----tool
 Processing----rout
 Risk Monitoring and Controlling
 Support to Green Economy
 Improvement of E&S Performance in banking’s operation

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2.2 Strategy
 Vision: build the most profitable, outstanding, respectable international first-class
modern financial enterprise
 Our Green Credit Strategy
 Target: Be committed to building a domestic leading, international first-class green
financial institution
 Basic Tenet: Give full play to the supporting and guiding function of credit , so as to
achieve better-saved resources, more friendly environment and more harmonious
society.

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2.1 Understanding of green credit
Environment Protection
Sustainable Development
（Balanced development between economy
and environment ）
Green Credit
Credit Structure
Adjustment
E&S Risk Management Green Credit Market
Credit Structure of
Industry
Credit Structure
of Customer
Credit Structure of
Destination
Resource Saving

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2.3 Policy
In 2014,ICBC revised and distributed the (green) credit policy for 61
industries ,including Electric Power, City Infrastructure, Steel, Culture ,
Tourism, Manufacture and etc.
Entry Criteria (Project Entry Criteria& Client Entry Criteria)
Project Entry Criteria: Scale ,energy efficiency ,technology, pollution
emission ,financial indicators etc.
Limitation and Exit Criteria: main high-polluting & Energy-intensive
industries (such as steel, cement, paper and nonferrous metals etc) and
overcapacity industries.

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2.4 Categorization
 In accordance with the "green" degree of the loan , namely its degree of E&S risks,
all loans of domestic corporate customers are classified into 4 Categories, 12
Segments.
 Friendly category(4 segments): ecological protection,clean energy and
comprehensive utilization of resources etc.
 Qualified category(2 segments)
 Observed category(2 segments)
 Rectification category(4 segments): environmental illegal or fined by
environment protection department
 established the link between green credit categories and enterprise credit rating that was
iintegrated in the loan process ;it is also a key criterion in the overall evaluation of the
customer.

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2.5 Entire-process management over E&S risks
 ICBC integrate the green credit requirement into the whole credit processing,
including credit survey, project assessment and approval, contract signing and
Post-loan Stage
 Principle: One-Vote Negation System
 Improve the mechanism of monitoring, identification, control and mitigation
E&S risks.
 System Control: ICBC locks the high-hazard environment industry (such as
heavy metal client )in the credit system

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2.6 Risk Management
Overcapacity industry:
--Apply the limit management for 8 overcapacity industries to control the total
issued loan , including steel, cement, smelt of common nonferrous metals, coal
chemical industry , photovoltaic manufacturing,ship manufacturing, wind power
generation equipment, and sheet glass.
Heavy Metal Emission, High Hazardous Chemical Industry
--Intensify the financial risk control on areas of heavy metal emission and high
hazardous chemical products, for the purpose of further reducing loans.
Haze-contributing Industries
----Set up specific requirements on industry’s credit structure adjustment, strict
implementation of entry criteria in environmental protection aspect, and cultivation
of emerging credit markets including energy saving and environmental protection.
These measures were aimed at intensifying the credit management on the industries
related to haze.

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2.7 Support Green Economy
 Identify the Green Economy area as encouraging
industries in related policies
 Differential policy:
Given the same risk and return level, priority shall
be given to the project in green economy.
 Performance( By the end of 2013)
 the loans granted to green economic fields totaled at
RMB 598 billion.
--the total loan balance for renewable and clean
energy totaled art RMB199.90 billion.
--the total loan balance for Green Traffic totaled art
RMB385.06 billion.
199.90
385.06
0
100
200
300
400
500
201312 201212 201112
RMBbillion Renewableand Clean Energy Green Traffic
Loan made to Green Economy Sectors
598
593.4
590.4
2013 2012 2011
Billion

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2.8 Low-carbon Operation
 Advocate Low-carbon Operation :
--The Bank promoted energy saving
and consumption reduction, starting
from tiny things, from everyone and
from now
 Promoting E-banking:
--E-banking proportion increase to
80.2%
 “green lighting project”
 energy-saving modification
projects of building
 energy-saving monitoring
arrangements
Proportion of business volume of E-
banking (unit:%)
80.2
75.1
70.1
2013 2012 2011
Office paper consumption(unit:in 100
million pieces)
0.096 0.097
0.11
2013 2012 2011
Office power consumption (unit:kilo
watt-hour)
21021205
21898969
20685557
2013 2012 2011

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2.9 Capability Building
 Strengthen green credit training
 Contents
Policy and rule about green credit
Knowledge about new energy and low carbon econmy
 Trainee
Manager at all levels
Customer manager
 Widen domestic and international
communication about green financing
with WWF、IFC、UNEPFI、
KPMG、PWC、HSBC……

18. Content
3.Typical Cases
1.Overview
2.Green Credit System
1.Overview
2.Green Credit System
3.Typical Cases
1.Overview
2.Green Credit System
1.Overview
2.Green Credit System
3.Typical Cases
1.Overview
2.Green Credit System
1.Overview
2.Green Credit System
3.Cases
1.Overview
2.Green Credit System

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Case 1 -PPP model for rail transit construction
Background:
 Beijing MTR Corporation Limited (BJ MTR) is the first foreign invested cooperation
company in urban railway transportation sector in mainland China.
 Beijing Metro Line 14 is the second subway construction project that use PPP mode and
it is a very important project in Beijing Rail Transit Construction Planning.
 BJ MTR is responsible for the construction of Part B of Line 14.Total Investment of Part
B is RMB 15.3 billion. The borrower apply for RMB 10billion.
 Partnership: Beijing MTR Corporation Limited ,Beijing Municipal Government
Key Factors:
 The franchising period is 30years.
 Although the actual fare income is lower than the level of agreement, the Beijing
municipal government is responsible for the borrower's income gap to compensate.
 ICBC approved loan is 5billions.

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Case2 --Wind and Solar Energy in Gansu
 Solar and wind power has a strong
complementarity.
 As of June 2013, ICBC has offered financial
support to
 39 wind power projects in Gansu province
(total installed capacity of 6.62 million
kilowatts),
 44 of solar power generation project (total
installed capacity of 2.34 million kw) . Since
 2009, our cumulative distribution to
Wind&Solar Power in Gansu Province is totaled
￥ 9.81 billion.
 ICBC’s supporting project can generate about
5.2 billion KWH per year, which can realize
saving standard coal about 1.71 million tons,
reducing 4.12 million tons of carbon dioxide each
year.

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Case 3:Xixi Wetland Park in Hangzhou
 Xixi Wetland Park is the first national urban Wetland Park, is listed as national
urban Wetland Park model. It is also culture wetland and farmer wetland.
 Consideration of ecological problems in the process of project construction and
farmers move .
 Relocation measures for farmers include providing housing for farmers, establish
multiple dwellings, and offer social security benefits, also provide venture funds
and so on.
 2007-2009 ICBC offered loans about ￥1.8 billion to this project, by the end of
September 2013, outstanding loans is ￥620 million.
 In order to support project development, ICBC adopted way of bridging loan,
resolving effectively the funding gap in pre-project stage.

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Case 4:Supporting the Renewable Energy in South Africa
April 2013, ICBC signed agreement with South Africa's standard Bank.
In the next 20 year, ICBC will provide US 2 billion loans to support the
development of renewable energy in South Africa by the way of
syndicated loans.
Through the partnership with standard bank, ICBC aims to promote
South Africa renewable energy use, and help to protect the environment
of South Africa.

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THANKS!