Professional Documents
Culture Documents
Internship Report On Green Banking 2013 Prime Bank Limited
Internship Report On Green Banking 2013 Prime Bank Limited
G
S
Socia
lly
Res
pon
sibl
e
Banki
ng
THI
NK
GRE
EN
Green
Banking
Report |
1
INTERNSHIP REPORT
ON
COMPARATIVE ANALYSIS OF
LETTER OF TRANSMITTAL
August 20, 2013
Suborna Barua
Lecturer
Department of International Business
University of Dhaka
Subject: Submission of the Internship Report.
Honorable Sir,
It is my pleasure to submit my internship report on Green Banking Practices of Prime
Bank Limited. This report is a result of the Internship Program that I have accomplished for
a specified 15 days in the Green Banking Unit at the Head Office of Prime Bank Limited.
I have tried my level best to make this report comprehensive and informative as possible
within the time allowed.
I hope this report will meet the standards of your judgment.
Sincerely Yours,
Asif Al Nahian
Kazi Asif Al Nahian
ID: 02-200935
th
BBA 15 Batch
Department of International Business
University of Dhaka
LETTER OF AUTHORIZATION
This is to certify that the internship report on Green Banking Practices of Prime Bank
Limited as a part to fulfill the requirement of Bachelor of Business Administration, (B.B.A)
degree from the Department of International Business, University of Dhaka has been carried
th
out by Kazi Asif Al Nahian, student ID-35, a student of BBA 15 Batch under my
supervision. No part of the internship report has been submitted for any degree diploma, title,
or recognition before.
Date:
Suborna Barua
Lecturer
Department of International Business
University of Dhaka
Green Banking
Report | 4
ACKNOWLEDGEME
NTS
First of all I would like to express my deepest gratitude to the almighty for giving me the
composure to finish this work.
Internship program provides an opportunity to experience the real world scenario and helps
to develop own judgments. And doing my internship on the Green Banking Practices of
Prime Bank Limited was a great experience for me.
Here I would like to express my heartiest gratitude to my Intern Supervisor Mr. Subarna
Barua for his sincere cooperation and suggestions to complete my job.
I would like to express my gratitude to the Head of Green Banking Cell of Prime Bank
Limited for giving me a chance to work as an intern in his department.
Finally I am really grateful to my teachers and to the officials of Bangladesh Bank for giving
me such an opportunity to work in this project.
BBA 15 Batch
Department of International Business
University of Dhaka
ACKNOWLEDGEME
NTS
The concept Green Banking evolved in western countries and now is practiced in most of
the countries in the world. It indicates endorsing environment-friendly practices and reducing
carbon footprint from banking activities. Green banking is not just another corporate social
responsibility activity; it is all about going beyond to keep the world livable without any
significant damage. Green banking that considers all the social and environmental factors is
also called ethical banking. The main objective of green Banking is to ensure the use of
organizational resources in favor of the environment and society. Green banking as a concept
is proactive and smart way of thinking with a vision for future sustainability of our only
Spaceship earth.
Bangladesh Bank is the first central bank in the world that has taken real initiatives to
facilitate the way of Green Banking practice. With some specific guidelines and legal
frameworks the central bank of Bangladesh has been urging all the commercial banks in
Bangladesh to develop their own Green Banking Policies.
This paper is an attempt to analyze the Green Banking Practices of a renowned private
commercial bank in Bangladesh, the Prime Bank Limited and identifying the efficiency or
inefficiency of the initiatives taken by the bank regarding Green Banking.
Green Banking
Report | 6
TABLE OF
CONTENT
Topics
Page
1. Chapter-One
1.1 Introduction
10
10
11
11
2. Chapter-Two
2.1 About Prime Bank
3. Chapter-Three
3.1 About Green Banking
3.2 Evaluation of the Idea of Green Banking
3.3 Components of Green Banking
3.4 Challenges towards Green Banking
3.5 International Initiatives of Green Banking
3.6 Green Banking Products & Services in the World
3.7 Green Banking Practices in Bangladesh
13
15
16-17
17
18
19-20
21-27
28-32
4. Chapter-Four
4.1 Green Banking in Prime Bank Limited
34
35
36
37
38-40
41-42
43-47
48
49-50
51-52
5. Recommendations
53
6. Conclusions
7. References
54
55
CHAPT
ER
ONE
Green Banking
Report | 8
1.1
INTRODUCTION
An internship program is a very good approach to co-relate the practical
work experience with the theoretical knowledge because it provides an
individual the great opportunity to work in an organization with some
specific objectives. As a result it bears great importance in case of
business graduates.
As an intern it was a great opportunity for me to work in one of the
reputed private commercial banks of Bangladesh, the Prime Bank Limited.
During this period I had the opportunity to work in the Green Banking Unit
at the Head Office of Prime Bank Limited.
Green Banking or Sustainable Banking as a concept is not very new
around the world. Global warming, unusual weather pattern, rising
greenhouse gas etc. has always urged the business world to take some
responsibilities in safeguarding the planet. Consequently environment
friendly banking practices emerged in many western countries.
However, in our country, the central bank of Bangladesh, Bangladesh
Bank has taken the real initiative to make the financial industry more
environment friendly and responsible by formulating a detail Green
Banking Policy Guideline in February 27, 2011.
Now, the main objective of my internship program was to evaluate the
Green Banking practices of the Prime Bank Limited and this report is
basically a result of experience in the Green Banking Unit of the Prime
Bank Limited.
Green Banking
Report | 9
1.2
REPORT
ORIGIN OF THE
1.2
REPORT
OBJECTIVE OF THE
Green Banking
Report | 10
1.3
STUDY
METHODOLOGY OF THE
Practical work experience in the Green Banking Unit under the Risk
Management Division of the bank.
Secondary Sources:
1.4
STUDY
LIMITATIONS OF THE
Almost every research work has to face some limitations in its completion.
Limitations of a study are those issues that if analyzed could be more
helpful for the study. This internship report is not also out of limitations.
For the purpose of acquiring data to prepare this report I faced some
constraints that are listed below:
Lack of Published Materials: No kind of published materials was
provided to me during my internship period. The division only allowed me
to review their materials. As a result this report is in lack of some specific
reference papers in the appendix part.
Time Constraint: Covering the entire Green Banking performance of the
bank was a difficult task within the time allowed for the internship
program.
Lack of Experience: Preparing a formal document like an internship
report requires some prior experience in this field. I have tried my level
best to reduce the distortion or biasness of information that I have used in
this report.
CHAPT
ER
TW
O
2
LIMITED
Green Banking
Report | 13
CHAPT
ER
THREE
3.1
BANKING
ABOUT GREEN
Global warming, which is one of the most burning & discussed issues, has
the worst impact on the climate of the planet as a whole. Due to unusual
weather pattern, rising greenhouse gas, declining air quality etc. society
demands that business also take responsibility in safeguarding the planet.
Green Banking is one of the revolutionary concepts in todays business
world which basically refers to as sustainable banking, socially responsible
banking or ethical banking that endorse environment-friendly practices
and reducing carbon footprint from banking activities.
The main objective of Green Banking is to ensure the use of organizational
resources in favor of the environment and society. Green banking as a
concept is proactive and smart way of thinking with a vision for future
sustainability of our only Spaceship earth. So in a very specific wayGreen
Banking
means
banking
practices
that
foster
environmentally responsible financing practices as well as using
environmentally sustainable internal processes.
Morshed, Rubayat and Singha (n.d., p. 11) explained that Green Banking
can be viewed from two different approaches as follows:
3.2
EVALUATION OF THE IDEA OF
GREEN BANKING
Although the theoretical idea of Green Banking is not very old; some
practices can be traced from the ancient banking & financial practices.
During the 16
th
community provided the main framework for both life and economy and
therefore influence businesses and the financial sector as well. Besides,
during the 19
th
the criteria that were used as sustainability criteria later. (Weber n.d., p. 2)
These banks used some of the principles of the credit unions and cooperatives but added an ethical perspective to their business. Because of
higher energy and waste management prices it was worthwhile for a
service sector as well to be eco-efficient in order to reduce costs. At about
the
same
time
new
environmental
regulations
influenced
the
launched. Since then their market share is increasing. They changed the
landscape of financial products and services as they re-integrated nonfinancial issues like the environment or sustainability into financial
decision making processes and product development.
Weber (n.d., p. 3) again explained that another event that influenced the
financial sector to consider environmental responsibility was the launch of
the Kyoto Protocol on climate change mitigation. Because financial
instruments were needed to reduce carbon emissions, the financial sector
engaged in creating products and services around carbon reduction,
carbon offsets and financing projects under the Kyoto Protocol mechanism.
However, today the view about social or environmental responsibility in
changing from managing environmental risks into creating positive
impacts on sustainable development by using different financial products
and services. This new view is reflected in the Global Impact Investment
Network (GIIN) and in the Global Alliance for Banking on Values (GABV)
both of which emphasizes the positive role that the financial industry can
play in fostering sustainable development.
3.3
BANKING
COMPONENTS OF GREEN
Green Banking
Report | 17
3.4
BANKING
3.5
INTERNATIONAL INITIATIVES OF
GREEN BANKING
Environmental responsibility has always achieved importance from the
international community. During early 1990s there had been a growing
concern about the environmental management system because of
increasing energy prices and new environmental regulations.
However, from that time financial institutions have been trying to mitigate
social and environmental risk issues by introducing different
environmental friendly policies & operations. Today the financial sector
has begun to explore business opportunities connected with sustainable
development one of the result of which is the concept of Green Banking.
According to Pravankar (2008, p. 8)-in the beginning of the 1990 the first
sustainability mutual funds, indices and other financial products and
services were launched.
DEVELOPMENT OF UNEP
During the early 1990s the United Nations Development Programme
(UNEP) was launched which is now known as UNEP Finance Initiatives.
The objective of this initiative was to integrate environmental
considerations into the regular business operations, asset management,
and other business decisions of the banks. (Pravankar 2008, p. 8)
INITIATIVES TAKEN BY RENOWNED INTERNATIONAL
ORGANIZATIONS
Pravankar (2008, p. 9) also mentioned that during the year 1991 to 2002
some renowned international organizations had taken different initiatives
regarding environment friendly business practices like:
Green Banking
Report | 19
Green Banking
Report | 20
Products
Home Mortgage
Product Features
Banks
Government
led
green
mortgage initiative.
1% reduction on interest
for Dutch Bank
loans that meet environmental
criteria.
Offers free home energy rating
and offsets carbon emissions for
CFS
every year of loan.
Generation Green Home Loan
Offered to both new and old
homes, so those with existing
Bendigo
mortgages can take advantage of
Bank
discounted rates.
All projects must exceed state
requirements.
Green Power Oriented Mortgage
Provides an
incentive for
homeowners to use renewable
power.
N/A
Design focuses on sustainable
behavior or customer, rather than
on physical infrastructure of
their residence.
MyCommunityMortgage
and
Smart
Commute
Initiative Fannie Mae
(Citigroup)
Mortgage
Available to help borrowers buy
energy efficient
homes and use
Regions
Europe
Europe
(UK)
Australia
N/A
US
Green Banking
Report | 21
public transportation.
Products feature a variety of
options and flexible terms.
Commercial
Building Loans
Home Equity
Loan
Canada
Canada
US
US
US
US
US
residential
solar technologies.
Auto Loan
Fleet Loan
Credit Card
VanCity
Canada
Mecu
Australia
Bank of
America
US
Various
Various
Rabobank
Europe
Tendris
Holding
B.V.
Europe
(NL)
Barclays
UK
Green Banking
Report | 23
Deposit
Sales
Bank of
America
US
CFS
UK
Westpac
Australia
Shorebank
Pacifc
US
Barclays,
HSBC
Europe
Products
Project Finance
Partial Credit
Guarantee
Securitization
Product Features
Specialized service
divisions
are dedicated to long-term
financing of clean
energy
projects.
Some banks also specialize in
one (or several)
renewable
technology type and/or place a
premium on working
with
states
where
regulatory
framework and government
policy encourages
the early
adoption of clean technologies.
Led the effort to raise $1.5
billion of equity for the wind
power market in 2006, with
approximately $650
million
allocated to its own portfolio.
The farms renewable
energy
portfolio
now
comprises
approximately $1
billion of
equity investments in 26 wind
farms since its inception in
2003.
The farm is also actively
pursuing
investments
in
biomass, geothermal, and solar
power.
Portfolio financing technique
Combines the financing of a
portfolio of renewable energy
projects to the construction
risks associated with project
development.
Lead arranger on energy-fromwaste project financing
that
includes
a 25-year
loan
supported by waste contracts
with local authorities and
corporate backing on noncontracted waste.
Financial institution provides a
bond issued by a municipality
to
finance
environmental
projects.
A risk sharing arrangement for
environmental projects.
Banks/ FI
BNP Paribas
(Wind),
Rabobank,
Barclays,
Fortis,
Standard
Chartered
Bank,
WestLB
(Biofuels
and Wind)
Regions
JPMorgan
US
Dexia
(Wind)
US
Global
Bank of
Ireland
Europe
IFC
Global
Green Banking
Report | 25
Bonds
Technology
Leasing
Private Equity
Global
Global
US
Latin
America
Global
Europe
US
Indices
preserving biodiversity.
Provides 100% financing, with
a discounted rate on the loan,
to a non-profit organization to
acquire biologically sensitive
land
and
implement
sustainable forestry practices
and management.
Series
of
environmental
private
investor eco-market
products includes a bio-fuels
commodity
basket,
total
Carbon Finance
& Emissions
Trading
Bank of
America
ABN
AMRO,
JPMorgan
US
JPMorgan,
Goldman
Sachs,
Citigroup,
among
others
Various
US/
Europe
Global
(Mainly
Europe)
Europe
3.6
BANGLADESH
The Green Banking practices in Bangladesh can be viewed from three perspectives: 1)
Initiatives taken by Bangladesh Bank, 2) Initiatives taken by Government & 3) Initiatives
taken by other commercial banks.
Green Banking
Report | 28
4.3
BANKING
Green
Banking
Report | 36
4.4
REASONS TO INTRODUCE
GREEN BANKING
Prime Bank Limited is one of the reputed private commercial banks in
Bangladesh. The management committee is very conscious about the
goodwill of the bank and as a result there have been some initiatives
like assessing the financing process carefully, providing internet
banking facility to the clients etc. taken by the bank before the formal
instruction of Bangladesh Bank regarding Green Banking. So from the
viewpoint of GBC of Prime Bank Limited there are three core reasons
side by side of BB instructions to introduce Green Banking in the
organization. These are:
Credit Risk: Unusual weather pattern and global worming can cause
financial institutions to suffer from credit risk. For example, adverse
climate change may severely hamper a project financed by the bank
and thus lead to a credit default. Realizing this issue Prime Bank
Limited has rearranged its risk management policy by incorporating
the Environmental Risk Management in its Core Risk Management
Policy.
Legal Risk: Legal risk arises when financial institution finance to a
project that is environmentally harmful. In that case the financing
institution will be liable by the environmental acts. So this is another
important reason to introduce more environment friendly financing
policies.
Reputational Risk: In recent times bank are facing extreme
reputational risk arising from some recent big loan scandals. Besides,
the environmental awareness is also increasing day by day.
These issues together drive the Board of Directors of Prime Bank
Limited to introduce a Green Banking Policy which is called PBLs
Environmental Blueprint by the end of the year 2011.
Green Banking
Report | 37
4.5
PRIME BANK
Components of Green Banking include the factors that affect the Green
Banking activities of the bank. The following are the major components
of Green Banking in Prime Bank Limited.
GREEN BANKING POLICY
As per the instruction of Bangladesh Bank, Prime Bank Limited
formulated its Green
Banking Policy which is called PBLs Environmental Blueprint.
According to Green
Banking Policy of Prime Bank Limited, the policy shows PBLs view on
environmental issues and describes the Bank's environmental risk
management procedures and practices.
However, from my observation I have found that the policy is created
highlighting the issues that should be done with reference Bangladesh
Bank guidelines and instructions. Some specific issues of the policy
represent unorganized information.
Besides, the effectiveness of policy also depends on the sound
understanding of the policy. However, during my internship program at
the organization I found that only one employee under the risk
management division of the bank is overseeing all the Green Banking
activities. The Green Banking Policy is not disclosed to all the concerned
departments.
CLIMATE RISK FUND
Climate Risk Fund is one of the major components of Green Banking. It
is required as a precautionary measure for possible safeguards and
mitigating hazards due to climate change. A Climate Risk Fund is also
required for the banks as part of their CSR activities that relate to
climate change conditions.
In 2012, Prime Bank Limited has created a Climate Risk Fund and up to
the year 2012 it has allocated Tk. 60 million for this fund. However, by
the end of the year 2012 the bank made no utilization of this fund.
IN-HOUSE ENVIRONMENT MANAGEMENT
Strategy of reuse, recycling of materials and equipments, and source
reduction and waste minimization strategy is a part of in-house
environmental management. The Green Banking Cell of Prime Bank
Limited has developed a Green Office Guide to reduce water, paper
and electricity consumption which is yet to be approved by the
Green Banking
Report | 38
GREEN FINANCE
Green finance as a part of green banking makes great contribution to the
transition to resource efficient and low carbon industries i.e., green
industry and green economy. Prime Bank financed various projects which
are environment friendly. The projects which contribute to degradation or
deterioration of the environmental issues are usually avoided. The bank
financed Effluent Treatment Plants (ETP) of RMG and textile sectors and
projects having ETP. In 2012, the bank extended finance of Tk. 94.42
million for installation of ETP and Tk. 346.28 million for financing projects
having ETP.
However, in case of Green Finance, Prime Bank has exposure in only two
sectors-Installation of ETP & Projects having ETP. The bank has no
investment in solar plant project, bio-gas plant project, bio-fertilizer plant
project up to year 2012.
GREEN PRODUCTS
Prime Bank has introduced various services which are reducing paper use,
fuel consumption etc. Internet Banking, Online Banking, SMS Banking and
Phone Banking are such services which are gaining popularity day by day.
Besides, the bank has already introduced two specific brands under the
Green Banking Products category namelyALTITUDE and PRIME CASH.
ALTITUDE: This is basically an internet banking facility that provides
opportunity-
Prime Bank allocated Tk. 15 million per quarter for green marketing,
training and capacity building. After introduction of SMS banking, green
marketing is gaining momentum. Through push and pull system, the
customers are becoming aware of banks new products and initiatives.
Employment notices are given on website and
Green Banking
Report | 39
4.6
MANAGEMENT FRAMEWORK OF
GREEN BANKING
The Green Banking Cell of the Prime Bank Limited is working under the
Risk Management Division. The RMD consists of 6 members which are
also the member of the Green Banking Cell. All the works of the Green
Banking Cell are supervised by a Management Committee regarding
Green Banking and the decisions of any Green Banking initiatives are
taken by the Borad of Directors.
Overall Responsibility
The Management Committee responsible for ensuring the integration
of Environmental Risk Management into Credit Risk Management. The
operational responsibility is carried out by the Head of Risk
Management Unit/Head of Green Banking Cell Mr. Debashis
Chakraborti. The Board of Directors allocate and approve a
considerable amount of fund in its annual budget for Green Banking.
Internal Reporting
Green Banking Cell (GBC) actively and continuously works with
Business Team, HRD, LSSD, CAD, CRM & RMU to improve its
environmental management system and environmental qualities of the
projects which it finances. It reports to the
Management Committee (MANCOM) on Environmental Issues
periodically and takes the initiative to comply with the reporting
directions provided by Bangladesh Bank.
External Reporting
the respective quarter end. The GBC also keeps their annual report and
websites
updated
with
the
disclosures
on
green
banking
initiatives/activities.
Environmental Risk Management: GBC has already developed a
reporting system with the assistance of Bangladesh Bank, with a view to
intimating management, shareholders, and other stakeholders on the use
of these Guidelines. This reporting is done on an annual basis in the
Annual Report as the Sustainability Report & Green Banking. These are
enclosed under the ANEX part of this report.
Besides, there are two specific functions which are also considered under
the management framework of Green Banking. These are:
Credit monitoring function
This function is to ensure that environmental risk monitoring shall also be
undertaken as a part of monitoring credit risks. Prime Bank Limited has no
separate Credit Monitoring Unit and thus CAD/CRM performs the credit
monitoring functions and provides the necessary information to the GBC.
Database on Non-Performing Loans (NPLs) due to Environmental
Risks
GBC has already established a database of NPLs that are due to
environmental reasons. If the borrower has indicated environmental
factors as one of the reasons for delays in making repayments, then this is
noted in the database. The purpose of this database is to ensure that the
Prime Bank Limited streamlines its own institutional knowledge for better
decision-making in its future financing.
Green Banking
Report | 42
4.7INSTITUTIONAL
GREEN BANKING
ARRANGEMENTS
FOR
Making sure that all the employees know how to use the
equipments as for not to waste resources in unlearned hands
A LCD or Desktop Monitor use energy as of energy needed for
printing 800 Laser prints if it is left open for 8 hours without use. So
it is very important to shut down all the equipments
Personal computers must be shut down while not using it
Laptops should run in battery saving mode. The charger should not
be plugged in while running on battery.
Photocopiers and Printers have high electricity consumption and
these equipments are mostly turned on idle. All the employees must
know how to use them efficiently and must make sure to turn them
off after use.
Air Conditioning
Lights
Everyone must know Last man to leave the room , turns off the
switch rule not in just lights but in all equipments
All the lights except very important security lights will be turned off
after Office Hours
The Cleaning stuff must be trained to turn off all the lights and
equipments while not necessary
Conservation of Water
Purchase of Stationeries
Reuse of Stationeries
Green Banking
Report | 45
Green Banking
Report | 46
The Sector Specific EDD: The Technical ANNEX Part of the Environmental
Risk Management Policy of BB also represents sector specific due
diligence checklist for 10 specific sectors. These are:
1. Agri-business
2. Cement
3. Chemicals (Fertilizers, Pesticides
and Pharmaceuticals)
4. Engineering and Basic Metal
5. Housing
After completing the Sector Specific EDD the following Matrix is used to
give the project a total Environmental Risk Rating (EnvRR).
Now at present the GBC of the Prime Bank Limited has formulated two
sector specific policies. One is for the RMG & Textile Industry and Ship
Breaking Industry. The reason is that the bank has much exposure in these
two sectors. But the bank is considering the other sectors for new
financing projects.
However, in general the Prime Bank limited takes a financing decision for
those projects having the low or moderate EnvRR. And in case of High
EnvRR projects the bank gives importance on personal relation with the
borrowers and also gives high importance on the additional
documentations in the Environmental Risk Management Policy of BB.
Green Banking
Report | 47
4.8
DIMENSIONS OR COVERAGE OF
GREEN BANKING
Green Banking basically considers all the activities and relevant
policies of a bank that have a direct or indirect impact on the
environment. As a result, identification of the areas that are related or
associated with the coverage of Green Banking is a difficult task.
However, in Prime Bank Limited the Green Banking Cell (GBC) is
working under the Risk Management Division (RMD). This is logical
because the Risk Management Division is responsible for assessing the
feasibility as well as fitness of a project.
Here the Green Banking Cell uses the policies related to the Green
Banking activities which provide a detail assessment of the projects
regarding viability as well as environmental sustainability.
Besides policy formulation, the GBC also provides necessary dictation
regarding Green Banking Policy to the Retail Department to consider
these issues when making any decision regarding procurement.
The Sales and Marketing Division of PBL is also concerned about the
development of Green Banking Products. PBL has been allocating Tk.
15 million per quarter for green marketing, training and capacity
building. By this time PBL has introduced various products which are
reducing paper use, fuel consumption etc. ALTITUDE (Internet
Banking), Online Banking, SMS Banking, Utility Bill Pay service,
EasyCash (Mobile banking), Phone Banking and Prime Cash (A
Biometric Smart Card) are such products which are gaining popularity
day by day.
Besides, the Human Resource Department (HRD) of the Prime Bank
Limited is concerned about the initiative of Green Banking. As part of
formal initiatives the HR division invites ideas from employees for Go
Green program at PBL. These ideas are generally evaluated and
selected for implementation from MANCOM.
Green Banking
Report | 48
4.9
PRACTICES
Capacity
(In
60.00
60.00
0.00
0.03
130
12
5
Green Finance: Prime Bank Limited has exposure in only two kinds
of projects with regards to Green Finance. These are ETP and
Projects having ETP. During 2012
Prime Bank has financed a total of BDT. 440.70 million in these two
kinds of projects whereETP
94.42 million
346.28 million
Green
Banking
Report | 49
However, the bank is considering some new projects like Bio-Gas Plant,
Renewable Energy Plant etc. to finance in 2013.
Online Banking: Online banking or paperless banking is one of the basic
features of the Green Banking Initiative. Prime Bank Limited is lagging
behind in this sector too. Up to 2012 Prime Bank hasTotal number of accounts
Accounts facilitated with internet
banking
Accounts facilitated with SMS banking
663619
100%
14959
2.25%
7697
1.16%
Green Banking
Report | 50
4.10
BANKING
projects- ETP and projects having ETP. So I think Prime Bank may
consider other green projects like Solar Plant, Bio-Gas Plant etc.
Green
Banking
Report | 51
Green Banking
Report | 52
RECOMMENDATI
ONS
As a renowned private commercial bank in Bangladesh, the Prime Bank
Limited has already given much importance in balancing non-financial
issues such as environmental and social issues with financial priorities to
demonstrate the characteristics of good corporate governance throughout
the bank. Up to the year 2012 the bank has made complementary
progress and has taken some real initiatives regarding Green Banking like:
formulation of an active and responsive Green Banking Cell (GBC),
financing ETP projects, formulation of Green Office Guide for in-house
environment management, formulation of two Sector Specific Policies,
investment for installation of Solar Plant etc.
However, since the idea of Green Banking is getting new dimensions day
by day and there is a good opportunity of the banks to link their goodwill
and image with there initiatives of Green Banking, I think PBL still has a
long way to go I also think that the Prime Bank Limited should focus on the
following issues more in the upcoming years to make a good position in
this regard:
Green Banking
Report | 53
CONCLUSIO
NS
Green banking is no longer a new concept. The term has become popular
among the conscientious people in the backdrop of climate change.
Human activities have caused serious damage to the environment. All
have the responsibility to save the ecology by prudent activities. The
professional segment of the population of every country has a greater role
to play than the common man to check environmental degradation.
Bankers are an important professional group which has interaction with all
strata of people in the society. By adopting various green initiatives within
their in-house environment and also initiating prevention of air and water
pollution through their clients, bankers can contribute in a big way to this
noble cause. In a rapidly changing market economy where globalization of
markets has intensified the competition, the industries and firms are
vulnerable to stringent public policies, severe law suits or consumer
boycotts. This would affect the banks and financial institutions to recover
their return from investment. Thus, the banks should play a pro-active role
to take environmental and ecological aspects as part of their lending
principle which would force industries to go for mandated investment for
environmental management, use of appropriate technologies and
management systems.
Green Banking if implemented sincerely will act as an effective ex ante
deterrent for the polluting industries that give a pass by to the other
institutional regulatory mechanisms. There has not been much initiative in
this regard by the banks and other financial institutions in Bangladesh
though they play an active role in its emerging economy. The banking and
financial sector should be made to work for sustainable development. As
far as green banking in concerned, Bangladeshs banks and financial
institutions are running behind time. None of them are signatory to the
UNEP Financial Initiative statement. It is time now that Bangladesh takes
some major steps to gradually adhere to the equator principles-guidelines
that use environment-sensitive parameters, apart from financial, to fund
projects.
Green Banking
Report | 54
REFEREN
CES
1. Khondokar Morshed Millat, Rubayat Chowdhury, Edward Apurba Singha, n.d.,
Khan et al. 2012, Bangladesh Bank Green Banking Activities Other than In-House,
Green Banking Report: March 2012, pp. 5.
7. IFC Consulting Canada Inc. 2007, Green Financial Products & Services-CuCrrent