Regulatory Alerts2020-09-09
Added · Updated
SFD Circular Letter No. 05: Regarding Green Finance Target
The document amends the baseline for calculating the green finance target for all scheduled banks and financial institutions in Bangladesh, shifting the denominator from total funded loans/investments to total medium-term loans/investments (excluding employee loans). It mandates that these institutions ensure at least 5% of this new baseline is allocated to environmentally friendly projects identified or recognized by Bangladesh Bank. Additionally, it requires all scheduled banks and financial institutions to establish Green Banking Units in their head offices and all branches to facilitate green finance initiatives, with performance in green banking considered in their CAMEL ratings. These instructions are issued under the powers granted by Section 45 of the Companies Act, 1991, and Section 18(6) of the Financial Institutions Act, 1993, and take immediate effect.
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