Crédit Agricole CIB has announced a two-year NT$800 million (US$28.7 million) green guarantee facility out of US$125 million medium-term guarantee facilities for CTCI Group/CTCI Machinery Corporation, an engineering, procurement and construction services provider based in Taiwan.

The bank acted as the sole structuring adviser and sole guarantee bank for the transaction. This is Crédit Agricole CIB’s first-ever sustainability-linked green guarantee facility, setting a pioneering benchmark in sustainable financing in the trade finance market and in the renewable energy sector in Taiwan as industry players continue to step up their commitments towards carbon neutrality.

The facility supports CTCI Machinery Corporation’s local manufacturing activities of anchor components of foundation jackets for offshore wind turbines and therefore essential foundation components for offshore wind farms. The company will provide disclosure to Crédit Agricole CIB with regards to the underlying projects and the expected environmental benefits of the project, especially on greenhouse gas emission reduction.

To further demonstrate CTCI Machinery Corporation’s sustainable practices, the facility embeds a pricing incentive for the corporation to uphold a certain set of environmental management standards, subject to certification by an independent third party. 

“This innovative structure has not only connected conventional trade finance product with green use of proceeds, but offered CTCI Group an opportunity to express their ambitions to uphold sustainable practices in the manufacturing process or the wider supply chain through sustainability-linked mechanism,” says Benjamin Lamberg, chief executive officer at Crédit Agricole CIB Taipei Branch. “By implementing this first of kind sustainability-linked green guarantee, it has undoubtedly paved the way for future development of sustainable finance.”