Time: June 13, 2017 Source: Financial News (http://www.financialnews.com.cn/yh/shd/201706/t20170613_119026.html)

Bamboos all over the mountain produce a big mass of green; clear water reflects the blue sky and white cloud. Not long ago, when the reporter stepped on this land called Yu village, he was deeply impressed by the picturesque landscape.

In this small village located in Anji County, Huzhou, Zhejiang Province, the then Secretary of the Provincial Party Committee of Zhejiang Province Xi Jinping put forward the scientific idea of 'green water and mountains are treasure' 12 years ago. Now, the green economy surrounded by waters and mountains replace the old picture of flying dust. The big contrast of Yu village is the real reflection upon the great changes here driven by green development.

'During these years, Huzhou has canceled more than 1900 enterprises with overcapacity. The production output has increased by 14 times and the capacity by 16 times by developing the green industry.' Zhong Jianlin, the director of the Ecology Office of Huzhou City told the reporter that in May 2014, the State Council approved Huzhou City to become the first demonstrative city of ecological civilization at prefecture level throughout China.

The development of green economy requires not only the courage of making sacrifice but the support of green finance. Zhou Diewen, the director of the Finance Office of Huzhou City stated that by the end of 2016, the balance of green credits and loans granted by Huzhou banks reached RMB 45.47 billion, accounting for 16.5% of all loan balance. Last year, the banking industry of the whole city supported 31 green upgrade projects of enterprises, with the total amount of RMB 11.68 billion.

The outcome of Huzhou is just an epitome of green development of our country in the past several years. When having investigations and interviews in many municipalities in Jiangsu and Zhejiang Province recently, the reporter saw green finance becoming great power pushing forward the green transformation of the economy as the green development has been upgraded into a national strategy. As the initiator and pioneer of China's green finance, IB is always in the forefront. By now, the energy saved and emission reduced through the projects supported by IB's green finance have been equal to the total amount of CO2 absorbed by 831 hectares of forest, generating great social and economic benefits and truly retaining our green environment and benefiting our people.

  Green support: recall the old time of ecology

No matter in Zhejiang or Jiangsu, wherever the reporter went, he could always feel the strong vitality brought upon by green development. The outstanding outcomes of ecological civilization protection and construction has become a remarkable name card of the city.

Xuzhou City, as an old-line industrial base and the only coal base in Jiangsu province, put its economic focus on industry for many years, causing changes to its urban landforms and generating many coal-excavated subsidences and abandoned mines. In order to heal these 'scars', Xuzhou is the first city in China to 'reclaim coal-excavated subsidences', which have created hundreds of lakes, wetlands and scenic spots in the past few years, and repaid the 'ecological debt' owed by the traditional extensive economic mode.

It is worth mentioning that IB has done a lot for this. 'We have provided RMB 450 million of fund for two enterprises in Pizhou, the ecologically worst area of Xuzhou, used for reclaim projects of wasted mines.' Jiang Zhanqin, the vice president of IB Nanjing Branch, told the reporter that after the project is completed, it would realize 3988.79 mu of newly-added plowland, so as to achieve of land improvement goal of 'transforming non-plow land to plow land and turning low-grade land to high-grade land'.

According to statistics, by the end of the first quarter this year, IB Nanjing Branch has totally invested RMB 34.321 billion of fund in ecological environment protection and restoration.

The reporter learned from the investigation that, according to the overall goal of ecological protection and harnessing specified in the 13th Five Year Plan, the government of all level are now actively outlining the framework of ecological protection and aggressively implementing ecological environment protection and restoration. This process is accompanied by the support of green finance.

'Ecological construction requires capital support in addition to incredible efforts. IB is to Jiaxing, especially Nanhu, is what Miyazaki Hayao is to Jou Hisaishi.' Everybody is amused by the metaphor of Fu Qiang, the director of the Financial Office of Nanhu District, Jiaxing. Indeed, as we all know, the animation movie of Miyazaki Hayao, a Japanese movie master, is imperfect without the classic music of Jou Hisaishi. They are soul mates who make each other perfect.

Jiaxing is located at the downstream of the beautiful Jiahang Lake Plain, Taihu Lake and canal drainage basin. With more than 13000 stream flows of various sizes that form a dense network of waters, Jiaxing is a typical water town that is built by water, thrives on water and features beautiful hydrological landscape. However, affected down pollution from the upstream and itself, the water quality of Jiaxing has been dropping for the past 20 years, thus becoming an ecological factor which hinders the social and economic development of Jiaxing.

'In the river water examination of 2012, Jiaxing got the lowest score.' Xu Hui, the president of IB Jiaxing Branch, recalled the scene and told the reporter that, 'Although Jiaxing had a lot of rivers then, we have no water to drink.'

The 'Huangpu River Dead Pig Event' in 2013 also made a hit and greatly affected the water quality of the downstream Huangpu River. It was after this accident that Jiaxing government began to bet everything on pushing forward the 'Five River Harnessing' initiatives and became the first city in the province to start the war with water pollution.

In order to support the 'comprehensive water environment harnessing' project of Jiaxing, IB and Jiaxing municipal government signed the Strategic Cooperation Agreement on Jointly Facilitating the 'Comprehensive Water Environment Harnessing' Project of Jiaxing, with an aim to promote the application of advanced technologies in environmental protection and harnessing, support the development of low-carbon, green and environmental economic mode, and expand the 'Jiaxing Mode' of financing for water resource harnessing.

At the end of 2016, IB Jiaxing Branch totally invested RMB 12 billion for the 'Five River Harnessing' project. 'In 2016, our water quality and environment has been restored to the level of 1990s.' Xu Hui told the reporter delightedly. Under the support of green finance, Jiaxing has used 4 years to tack back the ecological results lost in the last 20 years.

 Gather minds and innovation: fuel up for green development

'The mid-term goal of green finance we have set is 'Two Ten Thousands'.' Luo Shiyi, the GM of Green Finance Department of IB said to the reporter, 'By 2020, the group will strive to achieve RMB 1 trillion of financing balance for green finance, the number of green finance clients (projects) will exceed 10 thousand.'

Luo Shiyi also mentioned that the amount of green leasing, green trust, green fund and green investment will reach RMB 100 billion respectively; the amount of green consumption loan and green mortgage will reach RMB 10 billion respectively.

It is known that in recent years, under the clear top design as a green financial group, IB roots on green credit and comprehensively utilizes diversified products of the group to continuously extend the business line of green finance including green leasing, green trust, green fund and green investment, and has become the top 'supplier of comprehensive services in green finance' in China.

'Since 2015, we, Shuangliang Group, have restructured our assets and adjusted our business structure with the great support by IB.' said by Miao Zhiqiang, the vice president of Shuangliang Group. Since Shuangliang Co-energy, a listed company affiliated to the group, has turned its business towards energy conservation, water conservation and environmental protection, and has produced strong demands for financing. Based on the features of financing demand, IB Nanjing Branch has customized a multi-directional service scheme of green financing which, in addition to the RMB 1.5 billion of credit line, also provides RMB 222 million of acquisition fund and RMB 174 million of security-backed buyback business.

The report learned that many enterprises in Jiangsu and Zhejiang province have received green financing from IB like Shuangliang Group and generated the power for development.

At the end of 2016, '16 Dun An GN002', a 1-billion green debt financing instrument of Dun An Group underwritten by IB Hangzhou Branch, was successfully issued. This is the first green debt financing instrument in the interbank market of Zhejiang whose biggest highlight was that it introduced 'green investor' in the book building for the first time in China. In regard to this matter, Yu Bo, the vice president of Dun An Group, has a lot to say, 'new energy, environmental protection and energy conservation are what Dun An will do in the future. We would like to try all green products of IB.'

Yang Jingbo, the board chairman of Zhejiang Provincial Environmental Protection Group told the reporter, 'next we will put focus on the development of energy saving and environmental protection industries. Now we are cooperating with IB to set up an environmental protection equity fund within the framework of state-owned capital.'

In fact, green finance relates to many non-financial matters and has no objective standards. The process of promoting innovation is the process of finding standards. In the interview, many enterprises delivered the same opinion to the reporter, that IB is the earliest and longest player of green finance products and service.

To boost the green transformation of the economy, IB has aggressively pushed forward innovation in green finance in recent years. It is reported that IB Nanjing Branch has successively released the first loan mortgaged on emission permit and the first green and non-public specified placement of debt financing instrument in Jiangsu province, and has implemented the first PPP project in the system of IB that introduced social capitals, the first service item bought by the government and etc.

In Zhejiang, IB Hangzhou Branch flexibly utilizes bond financing, industrial fund, financing & leasing, equity fund and many new-type instruments to strengthen the comprehensive financial services provided for industrial clients. By April this year, the balance of green finance achieved by all kinds of new instruments has reached RMB 21.936 billion.

 Stand out: making sustainably growing banking industry

Now the effect of green economy has just emerged in Jiangsu and Zhejiang. Great ecological advantages are now turning to economic advantages. What's more, the reporter learned that innovation in green finance can also take banks out of the depressed economic conditions and achieve sustainable development.

'The development of green finance brought on virtual enhancement for our industry.' Peng Guanghui, the vice president of IB Hangzhou Branch, was much impressed, 'We are the new-coming national shareholding bank in Hangzhou. However, by virtue of green brands, we have opened the gate of cooperation with government and enterprises.'

Starting from the second half of 2015, the financial departments, administrative units, state-owned enterprises of Zhejiang province have generally chosen cooperative deposit banks through bidding. The input of green financial assets, as an effective support for the local government, has become an 'extra point' in the scoring of financial deposits and thus increased the possibility of IB Hangzhou Branch to win the bid. In 2016, the bank participated in 440 biddings, won 170 ones with RMB 7.514 billion of newly increased daily deposit.

The input of green finance also effectively released the burden of asset scale. 'Last year, our investments in green projects accounted for 23% of the total investment and green loans accounted for 56% of the total loans granted by the branch. This years, thanks to the reserve of green financial projects as well as the configuration of special project scale, the loan balance of Hangzhou Branch was increased by RMB 11 billion, ranking the second in the system.' said by Peng Guanghui.

It is worth mentioning that under the influence of global economy slowdown in recent years, the NPA of private enterprises maintains high and the asset quality of banks are facing great challenges. By the end of 2016, the average NPA rate of banking industry in Zhejiang province was 2.17%. By effectively supporting the input of local government in green fields, IB Hangzhou Branch has achieved reasonable allocation of asset and business structure and remained a NPA rate of 0.98%. Its 'overall proportion of focus and NPA' remained the lowest in the industry.

'The fundraising cost of green finance business is relatively low. Meanwhile, the low NPA rate represents one reason why commercial banks are interested in green finance.' said by Yang Ying, the GM of green finance department of IB Hangzhou Branch, 'this fully reflects that developing green finance is a sustainable business mode.'

Data from IB shows that as of April this year, IB has accumulatively provided RMB 1.2048 trillion of green financing with a balance of RMB 567 billion. The NPA rate was only 0.38%, down by 0.11% compared with the beginning of the year; the number of green finance clients was rapidly increased by 573 compared with the year beginning, reaching up to 7603.

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Industrial Bank Co. Ltd. published this content on 13 June 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 05 July 2017 01:59:03 UTC.

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