First Commercial Bank combines core financial competencies to guide companies and investors to value ESG issues and cooperate to build a sustainable financial ecosystem. First Commercial Bank also guides its clients onto the world stage, facilitating green investments and sustainable green developments in industries, thereby creating a green virtuous cycle. First Commercial Bank endeavors to create a triple-win situation for industry, investors, and the environment and society. Looking to the future, First Commercial Bank will continue to pay attention to trends in international sustainable governance development and quantify the negative impacts of companies' financial situations brought by climate change risks. First Commercial Bank will exert its influence in sustainability as a financial institution and realize the sustainable goal of green finance.
Introduction to the Equator Principles
The Equator Principles (EP) are intended to serve as a common baseline and risk management framework for financial institutions to identify, assess and manage environmental and social risks when financing Projects. To fulfil its commitments to corporate sustainable development, First Commercial Bank became an Equator Principles Financial Institution (EFPI) on December 21, 2020.
Pursuant to the Equator Principles, EFPIs shall categorize projects in scope into Category A, B, or C, based on the magnitude of potential environmental and social risks and impacts. Additionally, EFPIs shall carry out environmental and social risk review of varying degrees for projects of different categories. In this way, the environmental and social impacts of medium and high risk level cases will be lessened. Also, through the covenants linked to compliance with Equator Principles and annual monitoring of post-loan management, it can be ensured that cases are executed in compliance with the Equator Principles.
Look for more information on https://equator-principles.com/
Implementation Procedure and Management Structure of the Equator Principles
To comply with the regulations of the Equator Principles, First Commercial Bank established the "Guidelines for Loans Applicable to the Equator Principles" and relevant operating procedures. Furthermore, to suitably reduce potential credit risks, implement protective social and environmental measures, and adapt to the risks and opportunities arising from climate change, First Commercial Bank established the " Environmental and Social Risk Team", which executes environmental and social risk assessments, reviews and monitoring for loan application in accordance with "environmental/social risk assessment reports" and "environmental/social risk monitoring reports" issued by independent and qualified third-party institutions.
There are five steps for loan application complying with Equator Principles (EP). First, for loan application, the business units will check the EP applicability, and the Environmental and Social Risk Team (ES Team) will classify the environmental and social risk. Second, to request documents, the Credit Investigation Unit will request and review relevant documents and produce credit reports. Third, to review the loan application, the ES Team will review the environmental and social risk based on the assessment report issued by an independent third-party institution, and the credit approval unit will review the credit risk. Fourth, for loan drawdown, the business units will include EP compliance clause in the contract, and disburse the loan according to the credit terms. Finally, for post-loan management, the ES Team will monitor the environmental and social risk based on the monitor report issued by an independent third-party institution, and disclosure related information annually.
Comprehensive Internal Training
To help units familiarize themselves with the related mechanisms of the Equator Principles and added forms, First Commercial Bank appointed external consultants to organize training programs for senior executives, the Environmental and Social Risk Team, and business branches. These training programs intensify employees' knowledge of the environmental and social risks.
Annual Report of Equator Principles (Reporting period:2024/1/1~2024/12/31)
Project Finance Advisory Services
| Number of cases | |
|---|---|
| Sector | |
| Mining | 0 |
| Infrastructure | 0 |
| Oil and Gas | 0 |
| Power | 0 |
| Others | 0 |
| Region | |
| Americas | 0 |
| Europe, Middle East and Africa | 0 |
| Asia Pacific | 0 |
| Total Number | |
| Total | 0 |
Note: Number of project finance advisory services during the reporting period.
Project Finance
| Category | A | B | C |
|---|---|---|---|
| Sector | |||
| Mining | 0 | 0 | 0 |
| Infrastructure | 0 | 0 | 2 |
| Oil and Gas | 2 | 0 | 0 |
| Power | 1 | 0 | 2 |
| Others | 0 | 0 | 2 |
| Region | |||
| Americas | 2 | 0 | 1 |
| Europe, Middle East and Africa | 0 | 0 | 0 |
| Asia Pacific | 1 | 0 | 5 |
| Country Designation | |||
| Designated Country | 2 | 0 | 1 |
| Non-Designated Country | 1 | 0 | 5 |
| Both | 0 | 0 | 0 |
| Independent Review | |||
| Yes | 3 | 0 | 0 |
| No | 0 | 0 | 6 |
| Total Number | |||
| Total | 3 | 0 | 6 |
Note: Number of project finance that reached Financial Close during the reporting period.
Project-Related Refinance or Project-Related Acquisition Finance
| Number of cases | |
|---|---|
| Sector | |
| Mining | 0 |
| Infrastructure | 0 |
| Oil and Gas | 0 |
| Power | 0 |
| Others | 0 |
| Region | |
| Americas | 0 |
| Europe, Middle East and Africa | 0 |
| Asia Pacific | 0 |
| Country Designation | |
| Designated Country | 0 |
| Non-Designated Country | 0 |
| Both | 0 |
| Total Number | |
| Total | 0 |
Note: Number of project-related refinance or project-related acquisition finance that reached Financial Close during the reporting period.
Project-Related Corporate Loans
| Category | A | B | C |
|---|---|---|---|
| Sector | |||
| Mining | 0 | 0 | 0 |
| Infrastructure | 0 | 0 | 0 |
| Oil and Gas | 0 | 0 | 0 |
| Power | 0 | 0 | 0 |
| Others | 0 | 0 | 3 |
| Region | |||
| Americas | 0 | 0 | 0 |
| Europe, Middle East and Africa | 0 | 0 | 0 |
| Asia Pacific | 0 | 0 | 3 |
| Country Designation | |||
| Designated Country | 0 | 0 | 0 |
| Non-Designated Country | 0 | 0 | 3 |
| Both | 0 | 0 | 0 |
| Independent Review | |||
| Yes | 0 | 0 | 0 |
| No | 0 | 0 | 3 |
| Total Number | |||
| Total | 0 | 0 | 3 |
Note: Number of project-related corporate loans that reached Financial Close during the reporting period.
