Six major UAE banks dedicate Dh190 billion in green financing

Six major UAE banks have collectively dedicated more than Dh190 billion ($51.8 billion) in green financing for various projects in renewable energy, waste-to-energy, and green technology by the end of 2022, according to data from UAE Banks Federation (UBF) members.

Established in 1982, UBF is the sole representative body comprising 59 members of banks and organisations operating in the country. The federation revealed the success of the UAE banking and financial sector in developing sustainable banking solutions in line with the country’s strategy to reduce emissions and achieve climate neutrality by 2050 and with UN Sustainable Development Goals (SDGs).

First Abu Dhabi Bank (FAB), Abu Dhabi Commercial Bank (ADCB), Emirates NBD, Dubai Islamic Bank, Mashreq Bank, and Abu Dhabi Islamic Bank are the six banks leading the sector’s sustainable financing initiatives to support economic and social development by collectively providing more than Dh190 billion in green financing.

The UBF highlighted the proactive role of the banking sector in combating climate change through green financing commitments and climate initiatives and said that providing green finance and issuing green-oriented funds has emerged as a “powerful mechanism” to meet sustainability commitments of various organisations in the UAE in particular and the region.

Jamal Saleh, Director-General of UBF, noted that as an active partner in UAE’s sustainable pursuits, the federation works in close collaboration with the Central Bank of the UAE and all UBF members to support establishing the groundwork for the transformation to a sustainable economy.

“Sustainability is a top priority for us. While the Central Bank of the UAE leads integrating it into the regulatory frameworks and advancing Islamic sustainable finance in the UAE, we at UBF are committed to supporting its goals in delivering necessary changes in the UAE finance sector. And, in line with the National Climate Change Plan of the UAE 2050 and United Nations’ SDGs, our financial sector is playing a pivotal role in helping the UAE achieve net zero emissions,” Saleh said on the ongoing development of sustainable banking in the UAE.

“Achieving net zero emissions requires the full participation of the financial sector to channel capital into environmentally sustainable and climate-resilient investments. In January 2020, the UAE published a set of guiding principles for sustainable finance to promote the development of a green financial market and ensure consistency across the sector. Together with our member banks, we are working under the direct supervision of the Central Bank of the UAE to further advance sustainable finance in the region. Collaboratively defining a framework for accountability and best practices will encourage the transition to a climate-neutral, resource-efficient, and resilient economy,” Saleh added.