China to look into banks' quarterly green finance practices

Metrics include green finance share of total business mix.

China will probe banks’ green finance performance on a quarterly basis starting next year, reports Bloomberg.

The People’s Bank of China (PBOC) and its branches will assess banks based on metrics such as green finance share of their total business mix, the YoY growth rate of the outstanding value, and its share of risk exposure, according to a draft guideline released by the central bank.

An external evaluation by the regulator will account for 20% of weighting in the performance review.

The proposal, which is seeking public feedback until 19 August, will cover financial tools including loans, securities, investments, leasing and trusts. Banks will be rewarded or punished based on their performance results, the central bank said, but it did not explain further.

China, the world’s largest emitter of greenhouse gases, has been active in promoting green finance in recent years. In 2017, the PBOC co-founded a network of monetary authorities to run a project on integrating climate risk into financial supervision.

Here's more from Bloomberg.