KCB Bank #ticker:KCB will extend Sh5 billion loan facility to an infrastructural sector firm in the country, being the first company to receive the green funds.
In 2020, the lender received accreditation from the United Nations Green Climate Fund (GCF) for on-lending to investments and projects with a positive impact on the environment such as reduced carbon emissions.
The bank listed on the Nairobi Securities Exchange #ticker:NSE said most of the applications so far are from infrastructure, agriculture and, building and construction sectors, however failed to disclose the company’s name.
“The accreditation process is very long and rigorous. We are working with a number of clients going through the process. At the moment only one of whom has completed the technical assessment and we are looking to disburse this year,” said Rosalind Gichuru, KCB Group Director marketing and corporate affairs.
She spoke during the bell ringing for gender equality event by NSE and UN on the theme in fighting climate change. She did not divulge details of the company and the project.
KCB Bank was the first lender in the country to receive the accreditation, supporting growth for its loan portfolio under green space lending space.
The bank was accredited under the medium to large private sector category, allowing it to front projects of between Sh5 billion and Sh25 billion, meaning a focus on corporate entities.
SMEs can put an application as one entity.
The National Treasury is the national designated authority (NDA) for accrediting entities who apply for funding through GCF in Kenya.
The disclosure comes more than a year after the accreditation of the bank and the slow transition of the country to a low carbon economy through green finance and bonds.
There are concerns of default risk for investors and assurance of proceeds from green finance to be used in sustainability projects.This has seen the Treasury place stringent requirements such as documents showing policies and practices meeting environment and sustainability matters such as anti-money laundering, gender equality and whistleblowing.The bank has been aggressive in the green funding space and support lending to firms that want to support combat climate change.Last year, KCB had announced plans to issue a green bond this year.It is also working with development finance institutions such as International Finance Corporation and the African Development Bank to lend to small and medium enterprises.The threat of climate change is seeing posing a high risk to businesses.As a result, investors and policymakers are requesting information […]