British International Investment

Asian Development Bank MRPA

South AsiaSoutheast AsiaFinancial services

The Asian Development Bank (ADB) envisions a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty in the region. Despite the region’s many successes, it remains home to a large share of the world’s poor: 263 million living on less than $1.90 a day and 1.1 billion on less than $3.20 a day. ADB assists its members, and partners, by providing loans, technical assistance, grants, and equity investments to promote social and economic development. ADB maximizes the development impact of its assistance by facilitating policy dialogues,
providing advisory services, and mobilizing financial resources through co-financing operations that tap official, commercial, and export credit sources.

Our investment

Description of the investment.

This risk sharing sharing agreement is a partnership between the Asian Development Bank (ADB) and BII to support imports of green goods into South and South-East Asia.

The partnership aims to reduce the global trade finance gap and address this unmet demand for longer tenor for green transactions. It will help international banks increase their financing support to local banks, initially in Vietnam, before expanding to other countries supported by BII and ADB. This will provide crucial financing for local importers of solar panels, wind turbines, electric vehicles, and agricultural goods.

Impact information

Applies to investments made from 2019 onwards. The tabs in this section define what we expect to achieve through the investment, assessing the potential impact of the investment against six dimensions of impact. You can find more details on our methodology of assessing impact here.

What?

Impact

Avoid and reduce greenhouse gas (GHG) emissions by providing access to finance to climate finance sectors, particularly in renewable power (SDG 13a, 7.2).

How?

How?

Economic enabler: We will enter into a risk sharing agreement with ADB to allow it to extend more credit to issuing banks, enabling them to underwrite more trade volumes. This facility will be used to exclusively fund green transactions (as per our climate methodology), which will increase renewable power and reduce greenhouse gas emissions.

Who?

Stakeholder Geography Characteristics
Planet

Pakistan, Bangladesh, Vietnam

A range of climate-related transactions. Current pipeline indicates capex related goods for renewable energy, e.g. wind turbines.

How much?

Scale Depth/Duration

We use the scale of the facility and enabled trades as a proxy: this guarantee is expected to enable an average of $33 million in additional trade volumes per year.

  • Duration: Climate impact is expected to last beyond the tenor of the facility.

  • Depth: Expected to be varied given range of climate projects supported.

Contribution/additionality

Contribution/additionality
  • Financial additionality: Commercial funding is not available in sufficient quantity or on the same terms.

Risk

Execution Risk
External Risk
Alignment Risk

Impact score

Impact score (at point of investment)

The Impact Score is a tool to help us manage our performance against our strategic impact objectives. It is designed to incentivise investments that support our productive, sustainable, and inclusive objectives. You can find out more here.

The Impact Score is published for investments made from 2022 onwards. The Impact Scores are calculated at the point of investment. We publish the Impact Scores of new investments annually, once the information has been externally assured by an independent third party.

7

Environmental and social information

  • Environmental and social summary

    A high-level description of the environmental and social aspects of the investment. This may include a summary of key environmental and social risks identified during environmental and social due diligence (ESDD); key elements of an environmental and social action plan (ESAP); or ways in which we plan to support the investee improve environmental and social standards, such as through their environmental and social management system (ESMS); as well as any other priority areas agreed with the investee.

  • Environmental and social risk

    A risk category rating, which indicates the level of environmental and social risk associated with an investment. For an explanation of the categorisations used, see here. We consistently provide an environmental and social risk category for all investments screened from 2023 onwards.

Environmental and social summary

We worked with ADB to ensure there were appropriate E&S risk management measures in place to meet our E&S requirements for trade and supply chain finance. We will monitor activities under our trade finance facility.

Environmental and social risk

Medium-High

Reporting and Complaints Mechanism

The Reporting and Complaints Mechanism allows anyone outside BII to report alleged breaches of the business integrity or environmental and social provisions of BII’s Policy on Responsible Investing. This includes breaches made by BII, a BII investee, or a portfolio company of a fund in which BII has invested. The Reporting and Complaints Mechanism Rules are available here. Reports and complaints can be submitted by email to [email protected] or by mail. See more details on our Reporting and Complaints Mechanism here.

For any other general enquiries contact us at [email protected]

  • Key facts

    First published

    When the investment was first published on the website database.

    :
    March 2024
    Last updated

    When the last quarterly update of the website database occurred.

    :
    June 2024
    Project number

    An identifier number shared by investments in the same project.

    :
    D5237
    Status

    The current status of the investment (green flag for active and red flag for exited).

    :
    Active
    Region

    The geographical region where the country is located. We currently invest in Africa, South Asia, South East Asia and the Caribbean. In 2023, BII’s investment mandate was extended allowing it to invest in regional funds linked to Ukraine, with the majority of activity expected to begin post-war. Investments outside these regions were made prior to 2012 under previous investment mandates.

    :
    South Asia, Southeast Asia
    Country

    The countries where the investment delivers impact. Where impact is delivered in multiple countries, this is indicated.

    :
    Bangladesh, Pakistan, Vietnam
    Sector

    We prioritise those sectors that facilitate development and need our capital the most. Our priority sectors contribute towards many of the Sustainable Development Goals. They range from investing in the power infrastructure that will provide people with better access to electricity, to investing in financial institutions that direct capital to the individuals and businesses that need it the most.

    :
    Financial services

    We provide capital in the following ways: directly – through direct equity, direct debt, guarantees and other non-intermediated financial instruments; and indirectly – principally through investment funds.

    For direct investments and fund investments, this is the date BII committed capital to the investments. This is typically the date on which legal agreements are signed by all parties.

    For the portfolio companies of our fund investments, this is the date (either the month or the quarter) on which the fund committed capital to the portfolio company.

    For direct equity investments, this is the date at which British International Investment exited the investment.

    For debt investments, this is the date at which the final debt repayment was made.

    For funds, this is the date at which the fund was terminated.

    For underlying fund investments, this is the date at which the fund manager exited the investment.

    The total amount committed, per financial instrument, per investment, on the date BII becomes subject to a binding legal obligation to provide funding or assume a contingent liability. This information is provided in US dollars.

    For direct investments, this is the amount that BII has committed to the business or project. For fund investments, this is the amount BII has committed to the fund.

    The currency in which the investment was made.

    Investment type :
    Guarantee
    Start date :
    December 2023
    Amount :
    $50m
    Currency of investment :
    USD
    Climate finance

    Indicates whether the investment is climate finance qualified or partially climate finance qualified and the type of climate finance (adaptation, mitigation or both). We define climate finance using the multilateral development bank (MDB) and the International Development Finance Club (IDFC) Common Principles climate finance methodology. See Common Principles for Climate Mitigation Finance Tracking and Common Principles for Climate Change Adaptation Finance Tracking. We provide the climate finance qualification and type for commitments from 2020 onwards, which is when we launched our Climate Change Strategy.

    :
    Fully qualified
    Climate finance type:
    Mitigation

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