Sumitomo Mitsui Banking gives eco-loan to food oils producer in Malaysia
KUALA LUMPUR, NNA - Sumitomo Mitsui Banking Corp. Malaysia Berhad signed a financing agreement on Friday with Intercontinental Speciality Fats Sdn. Bhd., a producer of specialty fats and oils mainly for chocolate and its confectionary segments, to give the maker 900 million yen ($8.3 million) loan with favorable terms.
The wholly owned unit of the major Japanese lender SMBC agreed to give an eco-loan targeting companies that use environmentally friendly business practices. Those loans carry lower rates compared to normal financing vehicles. This loan helps companies follow Malaysian government environmental policy, the lender said.
The loan amount will be used for normal business operations, the two parties said at a signing ceremony in the Malaysian capital Kuala Lumpur. The loan repayment period is three years, but the two parties did not disclose other terms.
“The Malaysian government has been encouraging companies to incorporate sustainable practices into their respective eco-management framework,” Tetsuya Kainaka, the local unit’s CEO, told a signing ceremony. “We, in turn...support this effort of the Malaysian government by offering eco-loans to corporations that have made the leap to become eco-friendly.”
The oils producer makes ingredients for chocolate products, mainly for export to Europe. Its Gold+ rating from the major international accounting firm Ernst & Young certifies that the company has taken certain environmental initiatives and confirms knowledge of environmental processes in doing business.
Intercontinental Specialty Fats is a subsidiary of Japan's Nisshin OilliO Group Ltd.
“We have improved our sustainable palm oil policy and taken steps to ensure our raw materials are sourced responsibly in line with our commitments,” CEO Takashi Ishigami said at the event.
As a member of the Roundtable for Sustainable Palm Oil, a non-profit organization promoting sustainability of the palm oil industry, Intercontinental Specialty Fats helps enhance the sustainability of palm oil and its manufacturing processes industry-wide.
Sumitomo Mitsui Banking Corp. Malaysia says it has disbursed 78 million ringgit ($18.6 million) in eco-loans since 2012 to Japanese companies operating in Malaysia.
“In Malaysia, awareness about eco-loans is currently more prevalent among Japanese companies compared to Malaysian companies,” Kainaka said. “Therefore, we will work closely with the Malaysian government to create more awareness on eco-loans among Malaysian entities.”