KATHMANDU: Global IME Bank Ltd (GIBL) and the Global Climate Partnership Fund (GCPF) signed a $25 million loan agreement to promote climate-positive lending in Nepal.
This agreement marks the first climate-related funding provided by GCPF to Nepal. The funds are earmarked for financing energy efficiency and renewable energy projects in the country. The infusion of these funds will fortify the bank’s portfolio and solidify its commitment to climate change mitigation.
GCPF operates as a blended partnership model, using public funding to catalyze private sector investment model and growth in developing markets.
Commenting on the development, Global IME Bank CEO Ratna Raj Bajracharya stated, "This GCPF facility will play a crucial role in financing energy efficiency projects and reducing greenhouse gas emissions in Nepal. We take pride in being a responsible bank in our country and are committed to supporting energy projects in collaboration with GCPF to fulfill our strategic climate management objectives."
David Diaz Formidoni, Head of FI Investments and Climate Finance, said, “We are happy to expand our presence to Nepal, a country highly vulnerable to climate change, by partnering with a committed and like-minded financial institution like Global IME Bank. We look forward to supporting the bank in its climate financing journey through our in-house team of Climate Advisory Specialists and the fund’s Technical Assistance Facility.”
The GCPF is a Luxembourg-based fund, an innovative public-private partnership dedicated to mitigating climate change through a reduction of greenhouse gas emissions in emerging and developing markets. It focuses on financing energy efficiency and renewable energy projects, through local financial institutions or directly. Only projects that generate significant energy savings and pledge to reduce projected greenhouse gas emissions by at least 20% are eligible for funding.
GCPF was established by the German Federal Ministry for Economic Affairs and Climate Action (BMWK), KfW Entwicklungsbank and the International Finance Corporation (IFC) in 2009 as a public-private partnership. Junior catalytic capital is provided by BMWK, the Department for Energy Security and Net Zero (DZNEZ)of the UK, and Denmark’s development cooperation (Danida).
GIBL is the largest bank in Nepal in terms of total assets and has grown every year in size and profitability. The Bank has a large stable deposit base, low cost-to-income ratio, high retail assets, good asset quality and decent profitability. The bank has an experienced senior management team with a strong vision to grow the bank's operations profitably while maintaining high levels of corporate governance.
