Royal Golden Eagle (RGE) and Bank of Communications (BoCom) Jiangsu branch have entered into a cooperation agreement on carbon emission trading funds custody that allows the bank to handle the Indonesian conglomerate’s carbon emission transactions in China.

Made three days after the launch of China's national carbon emission trading market, the agreement is China's first carbon asset custody business between a financial institution and a multinational corporation. The agreement will bring into full play the role of carbon emission trading as a bridge and engine between financial capital and the real economy.

The agreement is a move by RGE to partner with the banking sector to facilitate China's efforts to achieve carbon peak by 2030 and carbon neutrality by 2060. Under the agreement, RGE will open a dedicated account for carbon emission trading settlement with BoCom to handle all its carbon emission transactions in China. The account will be under the supervision and custody of BoCom.

At the signing ceremony, Lin Bo, a top official of the Party Committee of BoCom Jiangsu branch, said that BoCom remains committed to promoting the development of real economy through financial innovation. The custody agreement will further deepen the business relationship between both parties in fixed-asset loans, cross-border supply-chain financing, and green finance

RGE is targeting for a 30% reduction in carbon emissions in China by 2030, says Shu Langen, vice-president of RGE China. The cooperation will enable RGE to increase carbon asset management efficiency and achieve its emission target, he adds, and it is a move to participate in carbon emission trading and help bolster China's carbon peak and neutrality goals.

Since its entry into China in the 1990s, RGE has invested over 60 billion yuan (US$9.3 billion) in Beijing, Shandong, Jiangsu, Shanghai, Chongqing, Jiangxi, Fujian, Guangdong and other provinces and cities. Its business groups Sateri Fiber in Fujian, Asia Symbol Paper in Guangdong and East Asia Power CCGT Power Plant in Xiamen have for many years been involved in the pilot carbon market of their respective provinces.

Industry experts have suggested that the offer of professional custody services by commercial banks can guide companies to playing an exemplary role in carrying out carbon emission trading compliantly and efficiently, spurring the improvement of the national carbon market.