HSBC is a powerhouse in sustainable finance in Asia: a multiple winner of this award and for good reason.
It has reduced carbon emissions in its Asia-Pacific operations by 56% since 2019 and is on track to hit its net-zero emissions ambitions within its own operations by 2030. Since 2020, HSBC Asia Pacific has contributed $75 billion to the global total of $294.4 billion in sustainable finance and investment raised and completed by the bank over the period.
“It’s a constant process of trying to improve,” says Jonathan Drew, head of global banking sustainability Asia Pacific at HSBC. “We deliver purposeful sustainable finance that supports our clients as they implement an inclusive transition.”
It has also set interim 2030 on-balance-sheet and facilitated emissions targets for clients across the oil and gas, power and utilities sectors, as well as on-balance-sheet financed emissions targets for other industries including cement, iron and steel, aviation and auto production. The bank raised the size of its sustainable finance scheme for the cross-border Hong Kong/China Greater Bay Area to $9 billion from $5 billion in 2023.
In alliance with the Glasgow Financial Alliance for Net Zero, a group formed during the COP26 climate conference in 2021, HSBC is working to develop financing frameworks to phase out the use of coal-fired power stations in Asia. It has also established new partnerships, including a three-year alliance with the Apparel Impact Institute, to mobilize blended finance for projects that reduce emissions in the global fashion industry.
Another notable new tie-up saw the lender join forces with global non-profit Repower, to repurpose coal-fired power plants in China, India, Indonesia and South Korea. It also became a founding member of the Capacity-building Alliance for Sustainable Investment, a global platform that provides local capacity-building services and technical assistance to support the growth of transition financing in developing economies.
During the awards period, HSBC Rural Bank continued to work on honing a more sustainable model of rural finance in mainland China. In 2023, it had an outstanding loan balance in China of Rmb2.62 billion ($361 million), of which more than 85% was to farmers and small and micro-sized enterprises. It also continues to support a range of initiatives, including microfinance in India, community partnership programmes in Hong Kong and projects that mitigate the impact of climate change in Sri Lanka.
Across the capital markets, HSBC was once again a leader in the sustainability space. It ranked number one for the seventh straight year for green, social, sustainability and sustainability-linked bond issuance in Asia ex-Japan, with $6.35 billion raised from 61 deals, according to data from Dealogic.
During the awards period, it helped Hong Kong Mortgage Corporation complete a $2.55 billion, triple-tranche social bond, the largest deal of its kind in the region and worked with the Hong Kong government to raise $102 million via the first tokenized Hong Kong dollar-denominated bond.
HSBC has reduced carbon emissions in its Asia-Pacific operations by 56% since 2019 and is on track to hit its net-zero emissions ambitions within its own operations by 2030
Elsewhere in Asia, HSBC helped Export-Import Bank of Korea unveil its inaugural blue bond, a $3.5 billion offering in January 2023. It worked with another Korean corporate, SK Hynix, to finalize the first hybrid green/sustainability-linked/conventional bond issued by a memory chip manufacturer; and with Bank of China (Sydney) to complete a $300 million senior unsecured floating rate sustainability-linked loan bond.
“We’re always trying to think of innovative indices as well as innovative hedging or financing solutions to help our clients on their sustainability journeys,” says Natalya Oram, director of global sustainability solutions at HSBC.
There were many other eye-catching deals in the awards period. HSBC acted as joint lead sustainability structuring adviser on CDB Aviation’s $625 million sustainability-linked loan; and on a green equity bridge loan that supported China Southern Power’s Kimal-Lo Aguirre transmission project in Chile. HSBC was sustainability structuring agent for Australian data centre operator AirTrunk’s A$4.62 billion ($3.08 billion) sustainability-linked syndicated facility completed in August 2023.
