RHB Completes First ESG-linked Cross Currency Interest Rate Swap

RHB bank HQ, Jalan Tun Razak. Kamarul Ariffin/The Star Rep: Joseph Chin

RHB Banking Group has successfully structured Malaysia’s first Green Cross Currency Interest Rate Swap transaction set against Environmental, Social and Governance Linked Key Performance Indicators to hedge a USD100 million 2-year Sustainable Loan.

This landmark Green Cross Currency Interest Rate Swap transaction further solidifies RHB’s commitment to enhancing the growth of the rapidly evolving ESG landscape within the Malaysian banking sector.

“The structuring and successful execution of Malaysia’s first Green Cross Currency Interest Rate Swap transaction drives sustainable value creation for our stakeholders and underlines RHB’s position as a leader within the ESG derivatives market.

“This first in market transaction marks the beginning of our journey in developing customizable sustainability linked derivative transactions using measurable KPIs. This will promote climate action and the adoption of sustainable practices leading to the realisation of actual impact and change in the real economy,” said Dato Khairussaleh Ramli, Group Managing Director and Group CEO of RHB Banking Group.

“Pioneering the hedging of a Sustainable Loan with a green Cross Currency Swap is testament to RHB’s commitment towards the adoption of green considerations across our Financial Services supply chain. This also provides our customers with expedient access to Sustainable hedging solutions to manage their financing activities more effectively and further contributes to our vision to create positive impact through our business activities as a responsible financial services provider,” Khairussaleh added.

Completion of the Green Cross Currency Interest Rate Swap, executed with Standard Chartered Bank, exemplifies RHB’s commitment to supporting the growth of the green economy by encouraging its stakeholders, including customers and business partners, to adopt more sustainable business practices.

A total of RM3.79 billion has been extended to green activities by the Group, of which 19% is attributed to renewable energy projects as at September 2021. 

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