Declared a leader in climate financing for second successive year by IFC at CAFI Awards
The International Finance Corporation (IFC) has reaffirmed Commercial Bank of Ceylon’s status as the South Asian financial institution to record the highest number of climate finance transactions in fiscal year 2022, awarding Sri Lanka’s benchmark private sector bank the prestigious Climate Assessment for Financial Institutions (CAFI) award in respect of the year.
The CAFI Award for climate reporting was conferred on Commercial Bank for successfully completing 314 climate finance transactions that met IFC’s climate eligibility criteria. The CAFI tool was used to assess climate eligibility and measure the climate impact of investments.
The only Sri Lankan bank to be accorded this accolade, Commercial Bank won the same award for fiscal year 2021 as well, alongside the climate impact award that acknowledged the Bank’s greenhouse gas (GHG) reduction.
Commenting on this recognition, Commercial Bank Managing Director/CEO Mr Sanath Manatunge said: “This award positions Commercial Bank as a consistent leader in climate financing and attests to our commitment to sustainable financing which is at the heart of responsible banking. We will continue to promote sustainable economic growth in this region and address challenges posed by climate change through our green financing and climate financing initiatives.”
IFC’s Global Director – Financial Institution Group Mr Tomasz Telma said: “We are pleased to recognise our clients’ dedication and transparency in reporting their climate investments. CAFI is a critical platform for reporting progress in the fight against climate change by linking finance to impact which ensures that the financial services industry can measure and quantify the climate impact of their investments using transparent and globally recognized methodologies.”
IFC awarded Commercial Bank after tracking data on climate financing submitted by its clients in the South Asia region using CAFI – a digital, web-based platform introduced by IFC to help banks and other financial institutions assess climate eligibility and to measure the development impact of the projects they finance. Commercial Bank uploads data on its green projects and green loans and leases granted to the CAFI platform as a practice. Using CAFI, the Bank can verify whether a project meets internationally agreed-upon criteria for climate finance and ensure that climate metrics and eligibility criteria stay in line with IFC’s definitions for climate-related activities and the common principles for climate mitigation finance tracking.
The Bank finances projects that focus on renewable energy, energy and resource efficiency, waste management, emission reductions, smart agriculture, green buildings among others under its Green Financing activities. The Bank’s Green Financing is geared towards the fight against climate change, meeting the United Nations Sustainable Development Goals 7 and 12: Affordable and Clean Energy, and Responsible Consumption and Production.
Commercial Bank was a pioneer in adopting a social and environmental screening process in its lending activities and was the first bank in Sri Lanka to develop a Green Financing taxonomy. It also revolutionised digital banking by introducing features in its ‘Flash’ mobile application to measure and offset customer impact on the environment.
IFC introduced the CAFI Climate Impact Awards in 2021 to recognise, by region, the financial institutions that have achieved the largest disbursements, largest expected GHG reductions, highest number of climate finance transactions booked, and those that exceeded their transaction target by the largest percentage. The CAFI Awards acknowledge IFC financial sector clients’ investments going into climate activities and the responsibility shown to report on their climate commitments.
To date, IFC clients have used CAFI to report more than US$ 9.9 billion of climate loans disbursed; annual avoidance of more than 24.7 million tons of greenhouse gas emissions; 41.4 terawatt hours of renewable energy generated; 2.4 million square meters of green area built; and 2.3 million cubic meters of water saved.
Commercial Bank’s Green initiatives include lending to support Sustainable and Green operations, migrating customers to paperless banking, improving efficiency in the use of energy, water and other resources in its own operations and supporting community initiatives that help conserve habitats and the environment. A mangrove restoration project in Koggala and a marine turtle conservation initiative in Panama are further examples of the Bank’s commitment to environmental conservation. The Bank has also funded the reforestation of a 100-hectare swath of degraded habitat belonging to the Kandegama forest in the Dimbulagala range of the Polonnaruwa District.
Commercial Bank is Sri Lanka’s first 100% carbon neutral bank, the first Sri Lankan bank to be listed among the Top 1000 Banks of the World and the only Sri Lankan bank to be so listed for 12 years consecutively. The Bank operates a network of 269 branches and 943 automated machines in Sri Lanka. Commercial Bank is the largest lender to Sri Lanka’s SME sector and is a leader in digital innovation in the country’s Banking sector. The Bank’s overseas operations encompass Bangladesh, where the Bank operates 19 outlets; Myanmar, where it has a Microfinance company in Nay Pyi Taw; and the Maldives, where the Bank has a fully-fledged Tier I Bank with a majority stake