Abu Dhabi – MENA Herald: National Bank of Abu Dhabi (NBAD) has today committed to lend, invest and facilitate a total of US$10 billion of financing within the next 10 years to projects focussed on environmentally sustainable activities.
The commitment, which is a first for a GCC bank, supports the research from NBAD’s: ‘Financing the Future of Energy Report’, which identified a funding gap of US$48 trillion dollars required in the next 20 years to meet global energy demand, with renewables playing a critical role in the energy mix of the future.
Alex Thursby, Group CEO of NBAD, said: “The world is heading towards a very significant funding gap for energy globally. This is particularly true across the West-East Corridor, the rapidly growing super-region that stretches from Africa through the Middle East to Asia – and filling it is going to be a big task. As the leading bank in the Middle East, we want to make a real contribution to the region’s ability to rise to the energy challenge. We believe that even in the current climate of low oil prices, the transition towards more renewable sources in the energy mix will continue because the underlying drivers are long term and strong. It is for this reason that we have made this commitment of US$10bn today. Through our Sustainable Business team we hope to become a positive force in the banking sector in the region, accelerating the transition to a much needed new world of energy.”
NBAD established a dedicated Sustainable Business team in August 2015, under the leadership of Nathan Weatherstone, to evaluate and create new financing products that will support the development of renewable energy and sustainable businesses – this commitment forms the first of these initiatives. The team will embark on an engagement programme with key regulators, policy makers and industry players to capture up to date market trends and promote continued partnership between the financial sector and environmentally sustainable businesses.
Nathan Weatherstone, Head of Sustainable Business Banking at NBAD, commented: “Our research has identified that there is approximately US$640 billion of investment required for renewable energy projects across the West-East Corridor. But sustainable business is wider than just renewables and includes activities like clean transportation, sustainable water, waste management and energy efficient real estate. The scale of the opportunity is significant and today we commit NBAD to an ambitious but much needed goal. Working with clients across a range of sectors, we will lend, invest and facilitate US$10 billion over 10 years for environmentally sustainable activities.”
Last year, NBAD launched the ‘Financing the Future of Energy Report’, at the Global Financial Markets Forum 2015 in Abu Dhabi. The report commissioned by NBAD from the University of Cambridge and PwC, and in collaboration with Masdar, found that US$48 trillion of investment was required over the next 20 years to close the global energy gap, with more than half being in renewables.
Sustainable Banking is a core part of NBAD’s business. In September 2015, NBAD became the first bank in the UAE to sign up to the Equator Principles, a voluntary set of guidelines based on International Finance Corporation standards on social and environmental sustainability and the World Bank Group’s environmental, health and safety guidelines. Environmental and social risk management is a key priority for NBAD, therefore policies and standards will continue to evolve in response to emerging risks and new product development. NBAD is also consistently one of the top 10 rated companies across the S&P Hawkamah Pan Arab ESG Index, the Institute for Corporate Governance.
NBAD’s strategy remains focused on supporting economic growth and financing transformative projects across the West-East Corridor.