Fri, October 22, 2021

business

Green bonds in high demand as investors embrace ESG: Krungsri


Krungsri Bank said it has committed to UN sustainable development goals, placing a focus on environmental, social and governance (ESG) issues.

Poonsit Wongthawatchai, Krungsri’s executive vice president, said Thailand’s green bond market has growth rapidly from almost zero three years ago to Bt10 billion in 2018, Bt30 billion last year and Bt37 billion in the first nine months this year.
Thailand’s green and social bonds will grow in tandem with the global market as investors embrace sustainable development goals, he said.
“Demand is high, but supply is constrained,’’ said Poonsit, who is also head of Krungsri’s environmental, social and governance division.
He forecast the green bond market would hit Bt60 billion by the end of this year. The Covid-19 crisis would also boost social bond issuances as the government sought funding to aid affected citizens and businesses, he said.
Prakob Phiencharoen, executive vice president and acting head of investment banking, said that Krungsri had introduced sustainability-linked loans. The current portfolio is about Bt10 billion, compared to the Bt420 billion loans for Thai corporate clients. 
“ESG-linked loans are still a small proportion, but we expect it will increase significantly next year,” he said.
Krungsri is leading efforts to help clients issue and distribute green bonds, the two executives said. The bank is a strategic member of the Mitsubishi UFJ Financial Group (MUFG), Japan’s largest financial group, and has gained in-depth knowledge of the green bond market from MUFG.
Investors are also seeking out green bonds as a way of reducing their carbon footprint amid the increasing threat of climate change, they added.

 

Published : October 27, 2020

By : The Nation