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We were the first Australian bank, and one of ten founding signatories globally to the Equator Principles. Today, there are over 50 signatories, covering more than 80% of the global project-financing market.

In adopting the Equator Principles, we agreed to provide loans only to those projects whose sponsors can demonstrate their ability and willingness to comply with processes that ensure that projects are developed in a socially responsible manner, according to sound environmental management practices.

The full text of the principles, as well as frequently asked questions, can be found on the Equator Principles website.

Applying the Equator Principles

The Equator Principles constitute an integral part of our project finance evaluation and decisioning process. We apply the Principles to all project finance transactions assessed, as we do not consider size to be the principal driver of environmental and social risks. To meet our commitments, we apply a detailed process of assessment against the Equator Principles, including:

• Categorising all new and existing projects as category A, B or C
• Completing internal documentation using the Equator Principles as the process benchmark
• Detailing any special conditions or covenants to apply
• Monitoring compliance with conditions subsequent and other material obligations of the borrower.

Following assessment, we include in documentation appropriate representations and covenants that ensure ongoing compliance with findings of the Risk Identification process, around the project category, the nature, physical location and sector and the host country.

All relevant personnel involved in the evaluation and approval process are informed of the Equator Principle requirements and implications of each project, and the Head of Project and Structured Debt (or a senior delegate) is required to sign-off on the assessment of each project finance transaction against the Equator Principles. In 2007, we also participated in IFC training held in Sydney on applying the Equator Principles.

Reporting on performance
Detail on our progress in implementing the Equator Principles is published in our annual Stakeholder Impact Report.

(12 mths to Sept 07)	Number	Loan value - Westpac share	Equator Principles Category
			A	B	C
Transactions closed	27	A$2,167m	1	23	3

This year, we participated in 27 project finance transactions. The assets financed were located in Australia, New Zealand, UK, Europe, North America and Papua New Guinea. Seven were greenfield developments, three were expansions of existing assets, nine refinanced existing assets, and eight were acquisitions.

The asset classes involved were social infrastructure, renewable energy, waste management, gas connection, electricity utility, ports, tollroads, rail facilities, airports, oil and gas production and mining. Our roles in these transactions were variably as Lead Arranger, Joint Lead Arranger and Underwriter, Sole Lender and Club Participant.

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