SINGAPORE (July 2): Deutsche Bank’s Corporate Bank today announced that it has provided a US$25 million ($34.8 million) sustainability-linked loan facility with a three-year tenor, and an accordion feature to upsize the facility to US$75 million, to Corrie MacColl, a subsidiary of Halcyon Agri Corporation.
The loan will go to financing the company’s capital expenditure (capex) investments for its rubber plantations in Cameroon and Malaysia.
The proceeds of the loan will be used for maintaining Halcyon Agri’s rubber plantations while promoting its Cameroon Outgrower Programme. The programme aims to provide additional food security and boost the income of 13,000 local smallholder farmers.
With the loan, Halcyon Agri will be required to comply with the mutually agreed sustainability framework developed by the Environmental Resources Management (Singapore) (ERM) throughout the loan.
ERM will also be reviewing the key performance indicators (KPI) of the loan. The KPIs will complement and enhance Halcyon Agri’s existing sustainability and objectives, setting a new standard for the rubber industry.
“We are delighted to have chosen Deutsche Bank for this one-of-a-kind loan structure. It was important to us to ensure that we continue to support our clients in a sustainable way, supporting our overall corporate social responsibility strategy and in accordance with developing standards for sustainable financing in the rubber industry,” says Jeremy Loh, chief financial officer of Halcyon Agri Corporation.
“We are committed to driving positive change through our efforts in sustainable finance, and are proud to pioneer sustainability-linked loans such as these in the market,” says David Lynne, APAC head of corporate bank at Deutsche Bank.
“The finance industry can play a critical role in helping companies reach their sustainability objectives, by helping align incentives to ensure that more sustainable business practices also make good financial sense. It is gratifying to work with partners like Halcyon on this type of project, which evaluates a broader set of more environmentally conscious metrics in defining successful business,” Lynne adds.
Shares in Halcyon Agri Corporation closed 1 cent higher, or 4.5% up, at 23 cents.
