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Scoping study Green Finance Facility with Bank of Nanjing

IPC was contracted by the Agence Française de Développment (AFD), France’s bilateral development finance institution, to conduct a scoping study to design a green financing facility for the Bank of Nanjing, the fourth largest city commercial bank in China. In China, AFD has a mandate to focus on fighting against climate change, promoting sustainable urban development, and protecting biodiversity and cultural heritage. The purpose of the scoping study was to carry out the preparatory work before the setting up of the AFD’s Green Financing Programme to Bank of Nanjing, which had the potential to include: a green credit line of up to EUR 100 million, a risk sharing scheme, and a technical assistance programme.

IPC’s experts implemented the following tasks:

  • analysing national, provincial, and local regulations and policies relevant to green finance in the four provincial level entities in which Bank of Nanjing operated (Jiangsu, Zhejiang, Beijing, and Shanghai)
  • identifying market opportunities for, as well as regulatory, financial, and technical barriers to, green finance investment, through interviews with bank staff, government officials, experts, project developers, energy service companies (ESCOs), and suppliers in Jiangsu and Zhejiang provinces
  • analysing Bank of Nanjing’s existing green portfolio and green project pipeline in-depth in order to identify potential green finance clients and target sectors
  • assessing the bank’s current green finance capacities and needs
  • defining green credit line financial and technical eligibility criteria based on national and international standards, as well as the results of market research
  • providing targeted recommendations regarding the disbursements process of the credit line, associated monitoring scheme, and programme setup
  • recommending target sectors in which to focus the green financing facility based on market research and in-depth conversations with bank staff and local stakeholders
  • suggesting relevant impact indicators to ensure a follow up of the programme through projects financed
  • designing a fitting technical assistance scheme for Bank of Nanjing, including recommendations on technical assistance setup and components, necessary expertise, and time and expense estimates

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