Latest news with #sustainablefinance
Arab News
27-05-2025
- Business
- Arab News
Saudi authority approves new guidelines for sustainable debt instruments
RIYADH: Saudi Arabia's Capital Market Authority has approved new guidelines for issuing green, social, sustainable, and sustainability-linked debt instruments. These guidelines, which came into effect on may 27, represent a crucial milestone in the CMA's broader strategy to deepen the domestic debt market and align the Kingdom's financial sector with the sustainability objectives outlined in Vision 2030. The initiative is part of the CMA's strategic plan for 2024–2026 and supports the Sustainability Strategy of the Ministerial Committee for Corporate Sustainability Strategy. Developed in collaboration with both public and private sector stakeholders, the guidelines serve as a key deliverable under the initiative titled 'Establish the regulatory framework for sustainable debt instruments.' This initiative aims to encourage local issuances and enhance the role of debt financing in the national economy. The approval of these new guidelines aligns with the CMA's comprehensive strategy, which includes over 40 initiatives designed to advance sustainable finance and develop the capital markets. Among these efforts are the creation of regulatory frameworks for green and ESG-linked bonds, the adoption of open finance practices to foster innovation, and the strengthening of corporate governance regulations to boost accountability and investor confidence. This development is particularly important as it accelerates the adoption of sustainable finance by creating a clear framework for issuing ESG-compliant debt instruments, enabling public and private entities to raise funds for environmentally and socially responsible projects. Furthermore, it strengthens the local debt market by encouraging wider participation from issuers and investors through enhanced regulatory clarity, which in turn improves market liquidity and access to capital. The CMA highlighted that while the new guidelines are non-binding, issuers offering green, social, sustainable, or sustainability-linked debt instruments denominated in Saudi riyals — whether through public or private placements — are required to disclose any deviations from the guidelines in their issuance framework or offering documents. 'The guideline does not entail any changes to the regulatory rules and procedures currently in place in the capital market,' the CMA stated. According to the regulator, the guidelines define four categories of instruments: green debt, social debt, sustainable debt, and sustainability-linked debt. Green, social, and sustainable instruments require that proceeds be used exclusively for projects that deliver positive environmental and/or social outcomes.
Zawya
27-05-2025
- Business
- Zawya
NBK-Egypt reports EGP 2bln (Equivalent to KWD 12.6mln) net profit in 1Q2025
Al-Bahar: The robust growth underscores the bank's strong financial standing and the agility of its business model across diverse economic landscapes The bank delivered solid operational performance across core sectors despite prevailing headwinds Upward momentum in key financial indicators reaffirms our path to strengthening NBK's presence in its most strategic foreign market NBK Egypt ranks among the fastest-growing institutions in the Egyptian banking industry Egypt remains a pivotal growth market and a cornerstone of the Group's long-term strategic vision The Egyptian economy offers vast potential, positive outlooks, and compelling opportunities for further growth El -Tayeb: The bank sustains its strong performance, delivering robust growth across all key financial indicators We aim to reinforce our presence in both the retail and corporate banking sectors NBK–Egypt accelerates its expansion of digital services and advances its digital transformation agenda We are committed to supporting the global shift toward sustainable finance and the green economy transition National Bank of Kuwait - Egypt (NBK-Egypt) has reported net profits of EGP 2 billion (Equivalent to KWD 12.6 million) for the first three months of 2025, from the EGP 1.3 billion (Equivalent to KWD 11.7 million) reported in the corresponding period of 2024, showcasing an impressive growth rate of 58%. Net Operating Income stood at EGP 3.8 billion in 1Q2025, recording an increase of 38% from EGP 2.8 billion recorded in the corresponding period of 2024. In the meantime, Net Interest Income grew by 41%, reaching EGP 3.3 billion compared to EGP 2.4 billion in 1Q2024. Meanwhile, Net Operating Income (excluding interests) increased to EGP 0.5 billion in 1Q2025, compared to EGP 0.4 billion in 1Q2024, up by 20%, while Cost to Net Operating Income dropped from 26% in 1Q2024 to 25% in 1Q2025. Total assets reached EGP 203 billion by the end of 1Q2025, up by 4% compared to EGP 196 billion by the end of 2024. Furthermore, total loans and credit facilities expanded to EGP 109 billion in 1Q2025, reflecting a growth rate of around 5% compared to EGP 104 billion recorded at the end of 2024. Additionally, customer deposits increased to EGP 164 billion by the end of 1Q2025, up from EGP 160 billion at the end of 2024, representing a growth rate of 3%. Furthermore, The Return on Average Assets (ROAA) improved to 4.1% in 1Q2025, compared to 3.6% in the corresponding period of 2024, while the Return on Average Equity (ROAE) increased to 35.8% in 1Q2025, up from 33.6% in the corresponding period of 2024. Commenting on the financial results announced by NBK-Egypt, Ms. Shaikha Al-Bahar, Deputy Group Chief Executive Officer, National Bank of Kuwait, and Chairman of NBK-Egypt, said: 'The robust profit growth achieved by National Bank of Kuwait – Egypt in the first quarter of 2025 is a clear testament to the strength of our financial position, the resilience of our business model, and our ability to perform across varying economic landscapes.' Al-Bahar explained that despite operational headwinds, the bank succeeded in delivering strong performance across its core business segments during the first quarter of 2025. She emphasized that the continued expansion of the bank's balance sheet and the sustained growth in key financial indicators reaffirm the soundness of NBK Group's strategic vision . She noted that the bank remains firmly on track to further strengthen its position in what has become the Group's most significant foreign market, given Egypt's vast potential, positive outlook, and promising growth opportunities. Furthermore, Al-Bahar affirmed that Egypt remains a key growth market for NBK Group and represents a cornerstone of its long-term strategic investments. She highlighted that the Group's operations in Egypt continue to rank among its most profitable, delivering the highest returns on shareholders' equity and assets. This performance, she noted, reflects the success of NBK's business diversification strategy and the rapid momentum of its digital transformation journey—both of which are central to the bank's efforts to expand its market share, particularly in retail banking, within one of the region's most populous countries and one of its most promising investment landscapes. She underscored the prominent footprint NBK Egypt has established as one of the fastest-growing banks in the Egyptian banking sector—an achievement clearly reflected in its robust financial indicators and the sustained growth in business performance witnessed over recent years. Al-Bahar also noted that NBK Egypt is focused on enhancing the quality of its services, expanding its geographical presence, and reaching a broader and more diverse customer base. She highlighted the significant strides the bank has made in modernizing its digital infrastructure, information technology systems, and electronic channels—advancements that have reinforced its position as a strong and competitive player in the Egyptian banking market. This progress comes in tandem with the growing demand for banking services and the rising momentum of financial inclusion across the country. Meanwhile, Vice Chairman, CEO, and Managing Director of National Bank of Kuwait-Egypt, Mr. Yasser El-Tayeb, said: 'The robust financial results achieved by the bank at the end of the first quarter of 2025 underscore the resilience and adaptability of our business model, enabling sustained growth despite the challenges posed by local, regional, and global market conditions.' El-Tayeb highlighted that NBK Egypt's business growth is well-balanced across all sectors, while maintaining efficiency and risk ratios aligned with sustainable expansion. This success is attributed to the bank's prudent policies and a flexible business model designed to effectively meet customer needs. He emphasized that NBK-Egypt is experiencing consistent growth across all activities and business sectors while maintaining efficiency rates and risk ratios that align with this expansion. This approach ensures business sustainability and customer satisfaction alike, thanks to the bank's prudent policies and its robust business model capable of meeting customer needs and diversifying income sources. He further added that the majority of NBK Egypt's income is generated from credit operations within the corporate sector, alongside contributions from retail banking. The bank's credit portfolio encompasses a wide range of clients, including large, medium, and small enterprises, while its retail banking portfolio serves diverse customer segments. This breadth underscores the strength and diversity of the bank's income sources. Al-Tayeb emphasized the bank's commitment to further strengthening its position in the retail banking sector by offering advanced services and products tailored to diverse customer segments, aiming to establish itself as a comprehensive bank that fulfills all their financial and life needs. He also affirmed the bank's ongoing commitment to enhancing its digital banking services, aiming to deliver a seamless and unique banking experience that enables customers to carry out most of their transactions anytime and from anywhere. He added that the bank is actively working to encourage wider adoption of digital payment channels, in line with the broader policy directions of the Egyptian government and the Central Bank of Egypt. El-Tayeb concluded by underscoring NBK Egypt's commitment to supporting the global shift toward sustainable finance and the transition to a green economy. He noted that the bank actively backs environmentally responsible projects that promote sustainability and rely on renewable energy sources. In addition, it continues to explore viable solutions to mitigate the adverse effects of climate change and reduce carbon emissions. He further highlighted that sustainable finance has become one of the most critical tools for safeguarding long-term financial stability. About the Bank: NBK-Egypt has a vast network of 52 branches spread over premium locations in various Egyptian governorates and cities, including Cairo, Giza, Alexandria, Delta, Red Sea, Port Said, Upper Egypt, and the industrial zones in 6th of October 10th of Ramadan cities. The Bank is also privileged to be among the elite banks within the Egyptian market that offer Islamic banking services in addition to its conventional products throughout its Islamic branches. Moreover, NBK-Egypt has a vast network of ATMs nationwide to service the Bank's clients around the clock. Furthermore, the bank offers a wide range of digital and electronic services, providing its customers with a unique banking experience. These services enable customers to conveniently conduct their banking transactions anytime and anywhere, eliminating the need to visit the bank for every transaction. National Bank of Kuwait (NBK) was incorporated in 1952 as the first local bank and the first shareholding company in Kuwait and the Gulf region. NBK continues to enjoy collectively one of the highest ratings among all banks in the Middle East from the three international rating agencies Moody's (A1), Standard and Poor's (A), and Fitch Ratings (A+). The Bank's ratings are supported by its strong financial indicators, asset quality, and high capitalization, in addition to its highly recognized and very stable management team, as well as strategic vision and stable funding base. NBK enjoys the most comprehensive banking presence with a local and international network with international presence in the world's leading financial centers including China, Geneva, London, Paris, New York, and Singapore, in addition to its regional presence in Egypt, Lebanon, Bahrain, Saudi Arabia, Iraq, and the UAE.
Arab News
23-05-2025
- Business
- Arab News
The benefits of local green taxonomies
As environmental, social, and governance investing expands rapidly across the globe, the framework for sustainable finance is becoming increasingly localized. While the EU Green Taxonomy has provided a strong conceptual foundation for the environmental management of financial tools, the global scope of sustainability now demands more tailored regional approaches. Many emerging markets and developing economies are preparing to attract green capital to support sustainable development. For them, localizing sustainable taxonomies is not only possible but essential. Climate change is among the greatest global challenges, but its solutions must be grounded in local realities. Environmental issues and development priorities vary widely by region. For example, Gulf Cooperation Council countries must diversify away from oil while simultaneously tackling acute water scarcity. Some observers argue that the EU Taxonomy Regulation may not align with Saudi Arabia's Vision 2030 economic diversification strategy, as it excludes key transitional elements such as blue hydrogen and carbon capture technologies. Similarly, ASEAN countries heavily dependent on coal and vulnerable to climate impacts require sustainability frameworks that balance development with environmental responsibility. Imposing one-size-fits-all standards — such as adopting the EU taxonomy wholesale — risks weakening national key performance indicators or discouraging investment in vital transitional sectors. In response, various countries and regions have developed their own taxonomies aligned with local strategies. China's Green Bond Endorsed Project Catalogue, updated in 2021, is one of the most advanced systems outside the EU. Notably, it removed 'clean coal' from the eligibility list — a move more consistent with global investor expectations and China's target of carbon neutrality by 2060. The ASEAN Taxonomy for Sustainable Finance, also introduced in 2021, uses a tiered system to reflect the differing development stages of member states. A sustainable future will not be created by copy-and-paste regulation. It will be driven by innovation and tailored, context-specific solutions that align with global objectives. Majed Alqatari In the Middle East, Saudi Arabia's Public Investment Fund has launched a sustainable finance framework that balances international standards with domestic priorities. The UAE has also issued its Green Bond and Sukuk Framework. These efforts reflect a broader regional ambition — reinforced at COP28 — to establish the Middle East as a hub for green finance. Local taxonomies are being designed not only to address environmental goals but also to unlock access to capital. For instance, HSBC reports that green and sustainable bond issuance in the Middle East and North Africa reached $18.7 billion in 2023 — a 42 percent increase from the previous year. Improved regulatory clarity played a significant role. Localized taxonomies help de-risk sustainable investments by offering issuers certainty and investors credibility. They provide a shared language through which market players — banks, asset managers, and regulators — can define and apply sustainable finance principles. Well-designed, transparent systems also improve access to international capital markets. Investor demand for taxonomy-aligned disclosures is on the rise. A 2023 PwC survey found that 79 percent of institutional investors were willing to back companies with high-quality ESG taxonomies. As a result, countries that implement robust, context-sensitive taxonomical frameworks can attract greater investor confidence and deeper pools of green capital. Aligning with international frameworks like the International Platform on Sustainable Finance or the Climate Bonds Standard enhances compatibility and reduces the risk of greenwashing — a top concern in global regulation. Ultimately, the future of sustainable finance lies not only in harmonization but in practical application. While the EU Taxonomy remains influential, the emergence of regional taxonomies is a welcome evolution. These self-directed systems allow nations to pursue climate goals without hindering economic growth. But for them to succeed, they must be built on best practices and supported by policymakers, multilateral banks, and the private sector. A sustainable future will not be created by copy-and-paste regulation. It will be driven by innovation and tailored, context-specific solutions that align with global objectives. • Majed Al-Qatari is a sustainability leader and ecological engineer experienced in advancing environment, social, governance and sustainability goals.
Globe and Mail
21-05-2025
- Business
- Globe and Mail
Ottawa's anti-greenwashing rules aren't radical. Companies are just overreacting
Jennifer A. Quaid is a professor in the civil law section of the University of Ottawa. Julien O. Beaulieu is a doctoral candidate at Imperial College London. Toward the end of April, Royal Bank of Canada RY-T quietly abandoned its pledge to mobilize $500-billion in sustainable finance by 2025. RBC is hardly alone. Across the corporate world, companies are scaling back climate claims and disclosures – a trend now widely dubbed 'greenhushing.' But this one hit differently. Unlike other companies that cite shifting political winds to justify their retreat, RBC blamed something more specific: new anti-greenwashing provisions added to Canada's Competition Act in June, 2024. Given RBC's size and influence, the bank's move sent a ripple through boardrooms nationwide. Some analysts warned that it could trigger a broader corporate retreat from climate transparency – especially coming just a few days after securities regulators dropped plans for mandatory climate disclosures. But let's be clear: This reaction is based on a distorted view of the law. The notion that good-faith environmental disclosures are fair game for anti-greenwashing enforcement is wrong and dangerous. It overstates the risk of liability and gives cover to companies walking away from commitments they may never have intended to honour. The new anti-greenwashing provisions are based on a simple premise: If a firm makes an environmental benefit claim, it should be able to prove it using sound, generally accepted methods. This isn't radical. It reflects a core principle of fair markets: Consumers and investors need credible information to make informed choices. When it comes to claims about environmental performance, especially ones that set future targets ('net zero by 2030') or are comparative ('greenest in the sector'), it's hard for consumers and investors to check them independently. That's why the law requires that firms that make these claims be able to back them up. Insisting on substantiation guards against deception, promotes trust and supports competition, key ingredients to fostering the innovation needed to transition our economy. Other countries – and other Canadian regimes, such as food and health product regulation – already impose similar or stricter standards on this kind of claim. This is hardly uncharted legal territory. So why the panic? Much of the hand-wringing has focused on a provision that requires companies making general forward-looking environmental claims to have 'adequate and proper substantiation' based on internationally recognized methodology. Some firms assert that this novel phrase is too vague, making it difficult to determine what they can and can't say. The Competition Bureau issued draft guidance on the topic, but the guidance isn't binding and doesn't spell out a list of approved substantiation methods. The upshot is an increasing number of firms have concluded that the safest option is to pull back entirely from climate disclosures. They point to the risk of enormous fines – up to 3 per cent of global revenues and the threat of lawsuits from private parties once a new right of action comes into effect in June. Some go further, claiming the law chills free expression and discourages green investment, and it overlaps with disclosure requirements under securities law. But these arguments don't entirely hold up to scrutiny. Yes, the term 'internationally recognized methodology' is new in Canadian law. But it's not a high bar. It doesn't mean firms need formal endorsement from a global body for every metric they use. What's expected is evidence that a claim rests on science-based, expert-informed principles – not vague aspirations or marketing fluff. The Competition Tribunal will interpret this provision with common sense, in line with Parliament's intent: to protect consumers and investors from deception, not to punish honest attempts at transparency. A rigid, overly narrow reading that limits firms to a fixed menu of certification schemes would defeat the purpose. In practice, many widely used sustainability metrics and frameworks will likely qualify. New methodologies developed by Canadian firms that align with internationally accepted scientific and accounting principles should, too. As international and Canadian initiatives continue to develop clear methodologies, uncertainty will diminish, as is always the case following the introduction of new law. The threat of litigation and catastrophic penalties is exaggerated. The Competition Bureau has limited law enforcement resources. Its past practice shows it will target clear-cut, egregious cases. Private claims will have to be authorized by the tribunal and deemed in the public interest to proceed – a high bar that will deter frivolous lawsuits. Class actions are also unlikely to become frequent, as the law does not provide for a damages regime from which lawyers could be paid. As for penalties, they are not automatic and don't apply to cases in which a firm shows it exercised reasonable diligence. Any penalties imposed must consider relevant aggravating and mitigating factors. And it's important to note that scalable penalties based on a firm's size are designed for cases in which the tribunal concludes that the appropriate penalty exceeds $10-million. Moreover, using global revenues to calculate a penalty is a fallback to be used only when it's not possible to calculate the amount of benefit a firm derived from its misleading claims. As for securities law, the Canadian Securities Administrators (the national umbrella group for provincial and territorial securities regulators) has abandoned its plan for mandatory climate disclosures, which means that reporting issuers will only have to disclose climate-related information that is material to investors. Such disclosures are unlikely to be caught in the scope of the Competition Act, which only applies to claims made to promote a product or business interest – not claims aimed at complying with a regulatory disclosure requirement. The bureau is still finalizing its enforcement guidance on the new rules. Some stakeholders have rightly called for more detail – especially on what counts as adequate substantiation. Effective greenwashing enforcement must be grounded in science, but also must be attentive to real-world constraints. The bureau should provide companies with actionable guidance about what claims they can make, when and how. The bureau must also be prepared to regularly update its guidance by co-ordinating with federal and provincial experts, as well as international peers. The federal government also has a role to play. It can issue regulations that would define safe-harbour methodologies under the Competition Act without legislative amendments. This cross-cutting effort could draw on the federal government's past work on net-zero targets, carbon accounting rules and the upcoming sustainable finance taxonomy. Transparency doesn't threaten sustainability – it protects it. Let's not allow a sensible check on greenwashing to become a convenient excuse for silence and inaction.
Zawya
21-05-2025
- Business
- Zawya
Development Bank CEO highlights climate finance leadership
Muscat: Development banks are evolving from project financiers to strategic climate partners, fundamentally reshaping sustainable finance. Development Bank CEO Hussain Al Lawati explored these changes during a panel discussion at the Islamic Development Bank Group Annual Meeting in Algiers on Wednesday, sharing insights from his institution's experience. For Oman, this evolution means moving beyond traditional project funding. Mr. Al Lawati highlighted Development Bank's commitment to key industries including manufacturing, fisheries, agriculture, mining, logistics and tourism with a focus on projects that will help achieve the 2050 Net Zero target. 'We serve as a catalyst for sustainable development by providing tailored financing solutions that support Oman Vision 2040 and drive economic diversification,' he remarked. This approach is clear in the bank's response to national priorities. Mr. Al Lawati explained how Development Bank's work connects local and global climate goals: 'We aren't just financing projects, we're enabling Oman's transition to a low-carbon, resilient economy that can thrive despite climate challenges.' Oman's changes are part of a bigger picture. Mr. Al Lawati noted how the global investment landscape has changed since November's COP29, where countries committed to providing at least US$300 billion annually for climate action in emerging economies by 2035, with developed nations leading the charge. This historic climate finance deal marks a turning point in worldwide environmental efforts. The proposed funding, combined with domestic finance will help countries adopt low-carbon technologies, build climate resilience and unlock green development opportunities. 'It's about building a safer and more prosperous future for everyone,' added Development Bank CEO. Addressing the economic implications, Mr. Al Lawati said climate change poses the biggest long-term threat to the global economy. Without decisive action, temperatures could rise by nearly 3°C, potentially shrinking the world economy by as much as 18% over the next 30 years. This reality underscores the urgency behind Oman's climate targets, including emission reductions of 21% by 2030 and 92% by 2050. In response to these challenges, Oman has designated 65,000 km² for renewable energy projects and launched major green hydrogen initiatives at the Special Economic Zone in Duqm. These projects not only address environmental concerns but are also expected to create quality jobs, supporting skilled employment and contributing to sustainable economic development. Development Bank is funding renewable projects and working with partners to attract private investment into the country's climate transition. 'We're expanding beyond traditional lending to become a strategic partner in Oman's green economy,' commented Mr. Al Lawati. 'Investing in renewable energy projects today creates long-term economic value, proving that climate action makes both environmental and economic sense.' 'Our goal is to ensure Omani businesses of all sizes can access the financial solutions and expert advice needed for sustainable, green growth,' said Mr. Al Lawati, reflecting on Wednesday's panel. 'By working together, we can build a more resilient and competitive economy for the future.' About Development Bank Development Bank (DB) is a key enabler of economic growth, providing innovative financing solutions to support Oman's Vision 2040 and the transition to a diversified, sustainable economy. DB offers tailored financial products and services to a wide range of sectors, including agriculture, fisheries, tourism, manufacturing, renewable energy, health, education and logistics, focusing on projects that drive in-country value and job creation. By funding MSME development, DB plays an important role in fostering entrepreneurship, promoting regional development that aligns with national and global sustainability goals.
