Case study: Sustainability-linked loan to CSSC (Hong Kong) Shipping Company Limited

Find out how CSSC Shipping and Standard Chartered worked together on a 10 year-sustainability-linked loan that will specifically support CSSC’s decarbonisation efforts, as well as its strategic goals around sustainability.

Sustainability-linked loan to CSSC (Hong Kong) Shipping Company Limited

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CSSC (Hong Kong) Shipping Company is one of the world’s leading ship leasing businesses, and a member company of the China State Shipbuilding Corporation Limited. The company is working to reduce carbon emissions, in line with China’s 3060 pledge1.

As the global shipping industry is central to supply chains and trade, it has an important role to play in decarbonising shipping and meeting sustainability targets.

Therefore, CSSC approached Standard Chartered to work together on a sustainability-linked loan that could specifically support CSSC’s decarbonisation efforts, as well as CSSC’s own strategic goals around sustainability.

Deal structure

Standard Chartered executed a 10-year sustainability-linked loan that supports four container ships with a total loan value of USD96 million.

The transaction differs from traditional ship financing in several ways. Firstly, the loan aligns with the Sustainability Linked Loan Principles2 which have been developed to facilitate environmentally and socially sustainable economic growth.

Secondly, for the duration of the loan, the average efficiency ratio of the four ships will be evaluated and other sustainable indicators will be monitored.

This is both a first in the sustainable finance field for Standard Chartered within the shipping industry in Greater China and North Asia, as well as CSSC Leasing’s foray into sustainable financing.

Standard Chartered’s role

Standard Chartered acted as the Structure Coordinator and Mandated Lead Arranger for the loan.

In facilitating the loan, we were able to combine our extensive experience of serving the global shipping industry and our position as one of the world’s leading providers of sustainability-linked finance solutions.

Decarbonisation is crucial to the long-term development of the maritime sector and Standard Chartered is well positioned to provide customised sustainable finance solutions to assist the industry’s transition.

Standard Chartered is a signatory to the Poseidon Principles3, which establishes a framework for aligning financing for the shipping industry with climate and sustainability goals. A key target within the Poseidon Principles is to reduce the global shipping industry’s greenhouse gas emissions by at least 50 per cent by 2050.




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