IFC is partnering with the Commercial International Bank (CIB), in developing and implementing a robust climate risk management framework to ensure the bank’s stability, regulatory compliance, and ultimately address the financing needs of its clients.
The advisory project will include an initial portfolio screening against climate risk and the development of scenario planning and stress testing methodology for CIB. The goal is to assist the bank in assessing its climate risk exposure, and ensuring any climate-related financial risks are disclosed in its portfolio.
With support from IFC, CIB had developed the first credit line fully dedicated to a certified green building in North Africa.
CIB’s Chief Risk Officer, Talha Karim said the partnership with IFC will further enhance the Bank’s process of integrating the climate-related risks into the existing risk management framework.
This latest project, supported by the Germany Federal Ministry for Economic Affairs and Climate Action (BMWK), is part of IFC’s climate programme, which aims to scale up private sector financing in the financial sector for climate mitigation and adaptation projects, while helping to mitigate climate risks.
“Climate change is the defining issue of our time. Banks, like all institutions, must adapt to the risks it poses,” said Sérgio Pimenta, IFC’s Vice President for Africa. “We’re delighted CIB is once again leading the way in accelerating the green transition and laying the foundations for a stronger, more sustainable financial sector, which can manage climate risks and meet the needs of its stakeholders.”
“This is not the first cooperation between the CIB and IFC, as in 2021, $100 million was dedicated to Egypt's first private sector green bond to help unlock finance for climate-smart projects, reduce greenhouse gas emissions, and support the country's transition to a greener economy,” said Egypt’s Minister of International Cooperation Rania A Al-Mashat
“CIB’s journey with climate risk started in 2020 when we first joined the Task Force on Climate-Related Financial Disclosures (TCFD) and aligned with the Equator Principles in accordance with international standards and best practices,” said Dalia Abdel Kader, CIB’s Chief Sustainability Officer. “Now, building on the success of CIB’s collaboration with the IFC and the issuance of the Green Bond, which helped us further develop our Environmental, Social Risk Management (ESRM) system, CIB is keen to take its partnership with the IFC to the next level.~
IFC’s current investment portfolio in Egypt stands at $1.5 billion and its advisory portfolio amounts to $32.5 million. IFC’s climate investments in Egypt amount to $1.8 billion since 2016, including mobilisation, with a focus on renewable energy, green financing for financial institutions, industrial and commercial energy efficiency, and green buildings.
(Writing by Eman Hamed; Editing by Anoop Menon)