Hong Leong Bank (HLB), Hong Leong Islamic Bank and the National Mortgage Corporation of Malaysia (Cagamas) have successfully concluded green housing loans and green asset financing transactions worth a total of 300 million ringgit (US$63.68 million).
The transaction was funded by the issuance of Cagamas’ one-year Association of Southeast Asian Nations (Asean) Green Bond worth 210 million ringgit and one-year Asean Green SRI Sukuk worth 90 million ringgit – collectively, Asean Green medium-term notes (MTNs) – under Cagamas’ 60-billion-ringgit conventional/Islamic MTNs programme. The issuances of the Asean Green MTNs by Cagamas are Malaysia’s first corporate issuances relating to green housing loans and financing.
The green housing assets comprise green residential properties and buildings using GreenRE1 and Green Building Index 2 certifications as their qualifying eligibility criteria. This demonstrates Cagamas’ and HLB’s joint commitment to support not only the growth of green housing, but also the broader objective to transition to a low-carbon economy. Previously, Cagamas had collaborated with HLB to issue an Asean Sustainability Bond to fund the purchase of affordable housing loans in 2021.
The green assets transaction not only reinforces HLB’s leading role in sustainable finance, says Kevin Lam, HLB group managing director and CEO, but also underscores its commitment to delivering value to customers, shareholders and the environment.
“We are currently witnessing a fundamental transformation in the way businesses operate where profitability must now align with the preservation of our environment,” Lam adds. “The increasing demand for green asset financing highlights the urgency of addressing climate impact and sustainability concerns. It also reflects a growing awareness that sustainable business practices are not just the right thing to do but also essential for long-term economic viability and environmental stewardship.”
Kameel Abdul Halim, president and CEO of Cagamas, shares: “The purchase of these green assets not only contributes positively to our environment but also fortifies our essential role in the facilitation of liquidity within a developing green capital market.”