Kathmandu, Global IME Bank Limited (GIBL) and the Global Climate Partnership Fund (GCPF) signed a USD 25M loan agreement to promote climate positive lending in Nepal.
Notably, this marks the first climate-related funding provided by GCPF to Nepal. The funds are earmarked for financing energy efficiency and renewable energy projects in the country. The infusion of these funds will fortify the bank’s portfolio and solidify its commitment to climate change mitigation.
GCPF operates as a blended partnership model, using public funding to catalyze private sector investment model and growth in developing markets.
Commenting on the development, Mr. Ratna Raj Bajracharya, CEO of Global IME Bank stated “This Global Climate Partnership Fund (GCPF) facility will play a crucial role in financing energy efficiency projects and reducing greenhouse gas emissions in Nepal. We take pride in being a responsible bank in our country and are committed to supporting energy projects in collaboration with GCPF to fulfill our strategic climate management objectives.”
“We are happy to expand our presence to Nepal, a country highly vulnerable to climate change, by partnering with a committed and like-minded financial institution like Global IME Bank. We look forward to supporting the bank in its climate financing journey through our in-house team of Climate Advisory Specialists and the fund’s Technical Assistance Facility” says Mr. David Diaz Formidoni, Head of FI Investments and Climate Finance.
The Global Climate Partnership Fund is a Luxembourg-based fund. The Fund is an innovative public-private partnership dedicated to mitigating climate change through a reduction of greenhouse gas emissions in emerging and developing markets. It focuses on financing energy efficiency and renewable energy projects, through local financial institutions or directly. Only projects that generate significant energy savings and pledge to reduce projected greenhouse gas emissions by at least 20% are eligible for funding.
GCPF was established by the German Federal Ministry for Economic Affairs and Climate Action (BMWK), KfW Entwicklungsbank and the International Finance Corporation (IFC) in 2009 as a public-private partnership. Junior catalytic capital is provided by BMWK, the Department for Energy Security and Net Zero (DZNEZ)of the UK, Denmark’s development cooperation (Danida).
Other private and public investors include ASN Bank, Ärzteversorgung Westfalen-Lippe, FMO, OeEB, Sparkasse Bremen, the European Investment Bank (EIB) and Heilsarmee.
GIBL is the largest bank in Nepal in terms of total assets and has grown every year in size and profitability. The Bank has a large stable deposit base, low cost to income ratio, high retail assets, good asset quality and decent profitability. The bank has an experienced senior management team with a strong vision to grow the Banks operations profitably while maintaining high levels of corporate governance.
It is the first commercial bank in the private sector to establish a branch network in all 77 districts of Nepal. The bank serves over 4.5 million customers through a network of more than 1,100 service centers, which include 350 branch offices, over 369 ATMs, 322 branchless banking services, 66 extension and revenue collection counters, and maintains 3 foreign representative offices.
For the year ended 16 July 2023, the bank reported total assets of US$4,049 million, loan book of US$2,845 million, net worth of US$451 million and deposits of US$3,279 million. The bank has robust asset quality (with a gross non-performing assets ratio of 3.08% and provisioning coverage ratio of 116.27%) and healthy profitability with return on total assets of 1.38% and return on equity of 12.36%. GIBL is rated “A” by ICRA.
The bank’s vision is to become “The Bank for All” and it has consistently expanded its reach to serve every corner of Nepal, diversifying its assets while contributing significantly to the overall Nepalese economy.
Global IME Bank has been honored by the Nepal Rastra Bank, the central bank of Nepal, for its substantial contribution to facilitating the inflow of remittances. In the fiscal year 2021/22, the bank’s efforts played a pivotal role in channeling 15.65% of the total remittances into Nepal.