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CleanTech lending at $8 billion, outstrips target

12 November 2014

Westpac Group increased lending to the CleanTech and environmental services sector to total exposures of $8 billion at 30 September 2014, significantly exceeding its pledge to make available up to $6 billion to this sector by 2017.

 

According to John Chauvel, Westpac Institutional Bank’s Managing Director Debt Capital Markets, this outcome demonstrates how seriously Westpac bankers on the frontline take the bank’s commitment to CleanTech lending and our sustainability strategy.

 

“I think people underestimate how effective the bank can be in tackling big picture issues like managing resource constraints and environmental impact while driving economic growth.  However, through the process of setting these investment targets we are creating greater awareness amongst our bankers about what CleanTech lending is and the customers we have that are engaged in Cleantech activities,” John said.

 

CleanTech encompasses a range of technology-based products and services that take advantage of renewable materials and energy sources, reducing the use of natural resources, and limiting or eliminating emissions and wastes.  Examples include renewable energy, lower emissions from transportation, energy efficient fuels, Green Star-rated property, forestry, waste processing and agritech solutions.

 

“We believe businesses engaged in CleanTech activities are having a materially positive impact on our economy, society and environment in a way that is consistent with Westpac’s sustainability policy.  In the long run, these will be sound businesses, good lending for Westpac and good value to our shareholders” he said.

 

John added that as at 30 September 2014, around 59% of Westpac Group’s total energy financing is now directed to renewable energy generation, including hydro, wind and solar.

A number of factors contributed to the strength of the CleanTech and environmental lending result, according to John.

 

“By engaging across our institutional business, we improved the way we capture data on attributed CleanTech exposures, both in terms of identifying a more complete set of clients and in better understanding the full extent of their activities,” he said.

 

“We also saw substantial growth in the number of property clients investing in new high performing green buildings or undertaking building upgrades to meet the minimum environmental performance threshold. This trend was reinforced by strong growth across the property portfolio overall.”

 

Australian Financial Services data has also been included for the first time. This contributed to a decision to update the previous years’ data to ensure a more appropriate comparison, resulting in a restated 2013 result of $6.4 billion.

 

John added that given the 2017 target had been exceeded well ahead of schedule, Westpac’s CleanTech working group will review options in 2015 for refreshing the Group’s CleanTech investment strategy.

 

Refreshed Climate Change and Environmental Position Statement

 

Westpac Group has released its refreshed Climate Change Position Statement and 2017 Action Plan.  This follows the completion of the five-year period of our 2009 Climate Change Position Statement and Action Plan.  The refreshed plan, which was formed in close consultation with both internal and external stakeholders, sets out our approach to managing environmental risk and creating innovative customer solutions over the next three years. This statement builds on our long standing commitment to measuring and reporting on our environmental impacts, as summarised in our Progress Report.