The National Bank of Cambodia (NBC), the central bank, welcomed the February 25 launch by the Bank for International Settlements (BIS) of the Asian Green Bond Fund, an open-ended fund for central bank investments in high-quality bonds issued by governments, international financial institutions and companies.
In a press release, the BRI said the fund is dedicated to helping finance investments in green projects in the Asia-Pacific region – in response to growing demand for climate-friendly investments.
“This fund initiative will help central banks incorporate environmental sustainability goals into their reserve management,” he said.
According to the statement, the National Bank of Cambodia (NBC) is a member of the advisory board that supported this initiative and will be among the first subscribers to the fund, which is an innovative step towards sustainable financing.
“As climate change is increasingly seen as one of the main sources of uncertainty for economic growth and could have a negative effect on social and environmental conditions, green finance opens up many profitable avenues investors to help protect the planet.
“While generating profits, investing in green bonds can also contribute to positive environmental impacts, as it is designed to finance green projects or environmentally friendly businesses in the region. This in turn leads to an increase in green innovations and promotes sustainable development,” he said.
NBC Governor Chea Chanto recognizes the financial risks and rewards of investing in green bonds as well as protecting the Earth. He said the central bank plays a role in helping to mitigate financial risks triggered by the impact of climate change on economic, social and environmental conditions.
“We believe that every institution and individual can play a role in contributing to equitable and sustainable growth by reducing the rapid pace of climate change and its channels of spread.
“We strongly encourage all financial institutions to put in place policies that promote green finance and support climate-friendly investments,” he said.
According to the BNC’s 2021 annual report, outstanding loans granted by financial institutions to all sectors increased by 21.2% to reach 186.4 trillion riels ($45.7 billion).
By the end of 2021, the Kingdom’s banking and financial institutions had restructured 22.4 trillion riels of loans for 370,785 borrowers, to ease the public’s burden amid lower Covid incomes and manage the pressure from non-performing loans, the BNC said.
Financial inclusion was also on the rise, with deposit and consumer credit accounts reaching 12.1 million and 3.3 million respectively, up 40.7% and 5.1% year-on-year, the Bank said. central bank.