Sarawak Energy – SEB gets RM100mil sustainability-linked loan (SLL) from CIMB Bank
KUALA LUMPUR: Sarawak Energy Bhd secured a RM100mil sustainability-linked loan (SLL) in the form of a revolving credit facility from CIMB Bank Bhd.
In a joint statement on Thursday, Sarawak Energy was the first East Malaysian company and the first utility company in Malaysia, to secure a loan linked to measurable sustainability performance targets (SPTs).
Sarawak Energy chairman Datuk Amar Abdul Hamed Sepawi said the company plays an important role as the state’s primary energy developer and power utility.
He added the company was a key implementer of the Sarawak Government’s vision and strategic initiatives to provide clean, renewable, reliable and affordable energy to our communities.
“We strive to incorporate sustainability into our businesses, operations and interactions with the community. “Through a more strategic approach to sustainability, we are creating value for all our stakeholders by managing long-term risks and opportunities. This sustainability-linked loan, validates our efforts in sustainability – not only is it good for the environment, it is also good for business, ” he said.
The announcement was made at a virtual SLL acceptance ceremony during a fireside chat session on “Creating a sustainable business model that works”, in conjunction with CIMB’s The Cooler Earth Sustainability Summit 2020. Sarawak Energy group CEO Datu Sharbini Suhaili said the loan will support its journey towards meeting Sarawak and the region’s need for reliable and renewable energy.
“We recognise the importance of sustainable financing and this is part of our efforts in sustainable management and embedding sustainable financing into our funding strategies to improve our environmental, social and governance (ESG) performance, ” he said. Group CEO of CIMB Group Datuk Abdul Rahman Ahmad, said CIMB was delighted to support Sarawak Energy in their sustainability journey. “We take our commitment to sustainability seriously, and understand our multifaceted role as a financial institution in working with stakeholders to promote sustainable development.
“This SLL is a testament to our commitment, in this case by incorporating environmental and social considerations into financing terms to incentivise and drive sustainable corporate behaviour, ” he said. The SLL, which is based upon sustainability performance targets, aims to improve Sarawak Energy’s ESG performance from FY2020 to FY2023.
It also and serves as a reminder for Sarawak Energy to keep its grid emission intensity in alignment with the Paris Agreement and the renewable energy developer’s pledge to “Business Ambition for 1.5°Celsius”. It also keeps Sarawak Energy on track in its goal to fully electrify Sarawak by 2025.
CIMB will grant a rebate against the loan interest if these pre-agreed SPTs are met. Sarawak Energy intends to use the interest rebates received from CIMB for its youth education sustainability programmes, as a way of giving back to the community.
CIMB is the first ASEAN banking group to become a founding signatory of the United Nations Environment Programme Finance Initiative (UNEP FI) Principles for Responsible Banking, and a signatory of the Collective Commitment on Climate Action. Earlier this year, CIMB was one of the first banks in Malaysia to announce the SLL incentive, having committed RM3bil to SLLs, and the Bank has been proactively presenting the offering to clients.