Bank of Huzhou
Provincial and regional banks have a huge role to play in boosting the appeal of China’s green finance industry for local governments. No other bank has done this better than the Bank of Huzhou, a local joint-stock commercial firm based in Zhejiang province.
By the end of 2019, the bank’s outstanding green loans had reached Rmb4.77 billion ($670 million) – up 28.4% since the beginning of the year – and accounted for 13.3% of its total outstanding loans. Most impressively, the non-performing loan rate for all of Bank of Huzhou’s green loans was zero in 2019, well below the average level of the bank’s total lending.
Under its president Wu Jiping, Bank of Huzhou may be regional, but it is also international. It joined the United Nations Environment Finance Initiative in July 2018 and adopted the Equator Principles a year later, becoming only the third bank in China to do so.
Bank of Huzhou also put green finance provision at the front and centre of its business. It launched its Green Finance Three-Year Strategic Plan in 2016. It also opened a special channel to approve green loans faster and set green loan targets for most of its branches.
The bank is among the first to join the China-UK Climate and Environmental Information Disclosure Pilot Programme, which aims to make information disclosure clearer for small and medium-sized banks.
The bank has issued Rmb1 billion of green bonds so far. The amount was issued in two phases, one in December 2018 and the other in March 2019. By December, all proceeds from the two green bonds had been distributed, going to 17 green projects and enterprises.