China's green loans had maintained fast expansion from the end of June 2021 to the end of June 2022 as the country steps up green growth efforts, a central bank report showed on July 29.
Outstanding green loans in yuan and foreign currencies reached 19.55 trillion yuan or about $2.90 trillion by the end of June, jumping 40.4 percent from the previous year, according to the People's Bank of China.
A green loan refers to a form of financing where funds go to areas such as energy conservation and clean energy that make contributions to environmental protection and improvement.
Specifically, green loans for projects with direct or indirect carbon-reduction benefits stood at 8 trillion yuan and 4.93 trillion yuan, respectively. Together, they accounted for 66.2 percent of the total green loans, the report showed.
China has advanced rapidly in developing its green financial system and markets, as part of efforts to achieve its carbon peaking and neutrality goals.
The China Banking and Insurance Regulatory Commission announced in early June that it has issued green finance guidelines, requiring banks and insurers to promote green finance at a strategic level, reduce the carbon intensity of their asset portfolios in a gradual and orderly manner, and eventually achieve carbon neutrality of asset portfolios.
Banks and insurers should increase support for the green, low-carbon and circular economy, prevent environmental, social and governance risks, include ESG requirements into their management processes and comprehensive risk management systems, strengthen ESG disclosures, and improve relevant policies, mechanisms and process management, the CBIRC said.
