The performance targets for the S$165 million sustainability-linked facility are aligned with greenhouse-gas emissions reduction targets validated by the Science Based Targets initiative.
CapitaLand Ascott Trust (CLAS) is the first lodging trust to secure an OCBC 1.5°C loan. With this S$165 million sustainability-linked multi-currency revolving credit facility, CLAS will receive interest rate reductions upon meeting the agreed annual greenhouse gas (GHG) emissions reduction targets. Proceeds of the facility will be utilised for general corporate purposes.
CLAS’ GHG emissions reduction targets are aligned with its sponsor CapitaLand Investment’s (CLI) 2030 Sustainability Master Plan. CLI has committed to achieve Net Zero emissions by 2050 for its Scope 1 and 2 GHG emissions, and targets to reduce absolute Scope 1 and 2 GHG emissions by 46% by 2030. These targets have been validated by the internationally recognised Science Based Targets initiative (SBTi) in 2022 to be in line with a 1.5°C trajectory, in alignment with the goals of the Paris Agreement.
The OCBC 1.5°C loan reflects OCBC’s longstanding commitment to support its customers on their Net Zero journeys with market-leading transition advisory and innovative financing solutions. There is increasing interest in this financing solution, reflecting the heightened momentum in the global Net Zero movement as well as the Bank’s active engagement with clients on their decarbonisation ambitions. As at 30 June 2024, OCBC’s sustainable financing loans had grown 33% from a year ago, and total sustainable financing loan commitments stood at S$63.3 billion.
Ms Serena Teo, Chief Executive Officer of CapitaLand Ascott Trust Management Limited and CapitaLand Ascott Business Trust Management Pte. Ltd. (the Managers of CLAS), said: “At CLAS, sustainability is a key focus and priority in everything we do. It is integrated throughout our business, including our capital management strategy. Leveraging CLAS’ leadership in sustainability, we are able to dovetail our environmental efforts with our financing needs. With this facility, CLAS has secured a total of over S$700 million in sustainable financing to date. We continue to collaborate with like-minded stakeholders in the banking and finance industry to do good, as we deliver long-term value to our Stapled Securityholders.”
Ms Elaine Lam, Head of Global Corporate Banking, OCBC, said: “We are pleased to support CLAS and its decarbonisation ambitions with our OCBC 1.5°C loan. We launched this financing solution last year to incentivise corporates to set and work towards clear carbon emissions reduction targets aligned with internationally recognised, science-based Net Zero decarbonisation pathways for their sectors. Despite macroeconomic challenges, it has been very encouraging to see more companies across various sectors in the region chart out their Net Zero journeys and setting SBTi-aligned decarbonisation targets. For those companies that are not quite as advanced yet, we have been actively engaging them on their transition plans and viable next steps to take. We are committed to support their Net Zero ambitions and the shift to a low-carbon future.”
