EXIM Bank evaluates RM500 million in 'green loans'

KUALA LUMPUR (Sept 21, 2011): Export-Import Bank of Malaysia Bhd (Exim Bank) is evaluating loan applications close to RM500 million for green technology projects in sync with the government’s call for financial institutions to support such projects.

Managing director and chief executive officer Adissadikin Ali said the bank had received several applications from Malaysian companies involved in green technology projects overseas particularly in the Asian region.

“We are currently evaluating loan applications for construction of public housing projects using the industrialised building systems (IBS) concept in a few countries in South Asia, the Middle East and Australasia,” he told Bernama.

Adissadikin said over the last three months, the company received many enquiries for green technology and renewable energy projects in Asian countries and these include mini-hydro, biomass and incinerator projects.

He is bullish on the green technology sector and expects overwhelming response from domestic firms for such projects.

“The world is going green and the first to go green are the developed countries. The developing and less-developed nations will follow suit,” he said.

Adissadikin also said Exim Bank, which sees a growing number of loan applications for cross-border trade finance, targets 30% of its total loans to be approved next year to come from the sector.

The bank aims to approve deals worth RM3 billion for next year. “We are growing our trade financing numbers. There are now demand for trade finance from non-traditional markets like Kazakhstan,” he said.

For the last six months, trade finance projects made up about 40% of the RM1.7 billion that was sanctioned to finance 54 deals, he said.

"These are financing for Malaysian companies such as the small-and medium-sized-enterprises (SMEs) that produced locally and sell overseas.

They are involved in palm oil, processed rubber and other products that are manufactured locally and exported.

The major destination of palm oil is the traditional export market for Malaysia, particularly China, India and other developed countries,” he said.

Adissadikin also said the current world economic situation may not severely affect the bank as the slowdown has also hit other parts of the world, mainly in Europe and the United States.

“Asia is still going strong and 60% of our exposure is in Asia,” he added. – Bernama