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Hong Kong Emerges as Hub for Chinese Firms Seeking ESG Loans

  • Sustainability-linked borrowing’s Hong Kong market share soars
  • Such loans tie interest rates to borrower meeting ESG goals

Chinese companies have long turned to Hong Kong for foreign-currency borrowings. This now includes a corner of the green-debt market that’s helping to stanch the city’s overall slowdown in corporate lending.

Mainland firms last year obtained $6.7 billion of so-called sustainability-linked loans, which tie interest rates to corporate sustainability targets. Nearly 40% of the facilities were syndicated in Hong Kong, according to data compiled by Bloomberg.