StanChart rolls out Singdollar sustainability-linked fixed deposits

StanChart's Singdollar sustainable time deposit follows its earlier US dollar sustainable deposit launched in Asia in October 2019. ST PHOTO: KUA CHEE SIONG

SINGAPORE (THE BUSINESS TIMES) - Standard Chartered Bank on Wednesday (Dec 2) announced the launch of its Singdollar sustainable time deposit, which is the first local currency sustainable deposit product that enables retail and private banking investors to get returns for their investments in sustainability.

The deposits reference loans and projects that the bank has made in support of the United Nations' Sustainable Development Goals (SDGs), such as Covid-19 healthcare, food security, renewable energy, access to water, and climate change adaptation.

They are similar to a typical fixed deposit where clients place a sum of money with the bank for a fixed period and will receive a fixed amount of interest at the end of the tenure.

With an initial deposit of $5,000 and above, the interest paid per annum is 0.3 per cent for a tenure of 12 months, according to StanChart's website.

The Singdollar sustainable time deposit follows its earlier US dollar sustainable deposit launched in Asia in October 2019 that allows both corporate and retail clients to access sustainable financing to support the SDGs.

According to StanChart's 2020 Sustainable Investing Review, nearly four in 10 investors in Singapore are considering allocating 5 per cent to 15 per cent of their funds to sustainable investments over the next three years, with half of the affluent and high-net-worth segment interested or extremely interested in sustainable investing.

Even so, StanChart Singapore chief executive officer Patrick Lee noted that there is a "massive shortfall" of US$25 trillion (S$33.4 trillion) in financing globally each year.

"At Standard Chartered, we believe that emerging markets have the greatest opportunity to leapfrog to low-carbon technology, to transit to more sustainable business practices and create good sustainable jobs," he said. "This potential cannot be fulfilled when emerging markets are bearing the brunt of this financing shortfall."

Mr Lee added that the bank is curating more of such sustainable investing solutions that can deliver both financial performance and sustainability outcomes to meet customer needs.

To ensure that the deposits support the SDG themes as intended, the Singdollar sustainable time deposit is governed by the bank's Green and Sustainable Product Framework. The framework guides the development of green and sustainable products and governs the use of proceeds.

The framework was developed by StanChart, with the support of Sustainalytics, a provider of environmental, social and corporate governance research and ratings for investor, financial institution and corporate clients.

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