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HSBC brings sustainable finance product suite to Canadian businesses

September 28, 2021   Maryam Farag

HSBC Bank Canada announced the launch of five new sustainable finance tools for commercial and global banking clients.

Available to Canadian businesses of all sizes, Green Deposits, Green Trade Finance, Green Revolving Credit Facilities, Sustainability-Linked Loans, and Green Equipment Financing are joining HSBC’s Green Loans launched in 2019.

“HSBC is the first bank in Canada to make such a comprehensive suite of options available for Canadian companies to take action on sustainability,” said Alan Turner, Head of Commercial Banking, HSBC Bank Canada. “Much of the focus to date has been on the large corporate and institutional markets. With these new tools, support for companies to achieve their sustainability goals is no longer the preserve of big businesses. Tools are now available for small and medium-sized businesses too.”

Deposits will be eligible to finance loans for customers’ green initiatives such as renewable energy, energy efficiency and biodiversity conservation, providing a simple way for companies to support environmentally-beneficial projects. Clients will receive a quarterly, portfolio-level view of how their funds have been deployed to support green projects, and they will be able to manage their green account as simply as a regular deposit account.

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Canadian businesses can now tie their borrowing costs to their progress on achieving sustainability goals with Sustainability-Linked Loans. With this type of loan, the interest rate is tied to a company’s achievement of key sustainability performance targets, which may include greenhouse gas emissions reduction, increased use of renewable energy, greater diversion of waste from landfills and reduced water use, as well as social and governance metrics like increased workforce diversity.

Green equipment finance, or green leasing, supports companies to finance the acquisition of equipment with tangible environmental benefits, in alignment with the market standard Green Loan Principles.

“We know from experience small and medium-sized businesses have a difficult time justifying sustainability spending,” said Angie Hall, Head of Sustainable Finance, HSBC Bank Canada. “These products will make it easier for main street and mid-market businesses to start on their sustainability journey.”