SINGAPORE (THE BUSINESS TIMES) - Sembcorp Marine (Sembmarine) has, through its subsidiary, obtained a $500 million sustainability-linked (SL) loan from DBS Bank.
The loan is believed to be the first in the maritime industry which references the Singapore Overnight Rate Average (Sora), DBS and Sembmarine said in a joint press statement on Thursday (March 4).
The facility comprises two components - a compounded daily Sora rate calculated in arrears and an applicable margin. It also features interest rate discounts linked to predetermined environmental, social and governance (ESG) targets.
The mainboard-listed shipbuilder will enjoy savings in borrowing costs as it meets these ESG targets, which are aligned with the group's performance targets set out in its sustainability report.
Sembmarine group finance director William Goh said: "This sustainability-linked financing complements our ongoing efforts to proactively manage the environmental impact of our business."
DBS's head of oil and gas Dorian Delteil noted: "As a purpose-driven bank, we believe financial institutions have a strategic and pivotal role to play in proactively supporting industries work towards a lower carbon future."
Shares of Sembmarine were trading 0.7 per cent, or 0.1 cent, lower at 15.3 cents as at 9.39am on Thursday.