Rare Asia Do-Good Loan Flags Growth Prospect for Tiny Market
- Frasers Property gets $428 million loan tied to ESG metrics
- Sustainability loans jumped almost seven-fold in ’18 globally
Photographer: Yuriko Nakao/Bloomberg
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One of the first examples of so-called sustainability-linked loans in Asia-Pacific has stirred discussion about how the market in the region may grow, and catch up with such fundraising elsewhere in the world.
An Australian unit of Singapore-based Frasers Property Ltd. secured A$600 million ($428 million) via a five-year syndicated loan late last month, in the first such deal signed Down Under. It’s offering a margin of 135 basis points over the base rate, and that can drop by as much as 5 basis points from the second year if it keeps a top score on its sustainability performance -- things like energy efficiency and recycling -- from a consultancy, according to people familiar with the matter.