Kathmandu, Nepal, May 3, 2017—IFC,
a member of the World Bank Group, is partnering with Nepal Rastra Bank
(NRB), the central monetary authority of Nepal, to help the bank adopt
improved environmental and social risk management practices to strengthen
their portfolio performance, generate business opportunities and boost
competitiveness in the region.
Improved risk management practices will
help minimize potential risks for financial institutions and will create
increased access to financing for businesses with strong environment and
As part of this program, IFC will assist
NRB in adopting a robust Environmental and Social Risk Management Guideline
and promoting its adoption by financial institutions in Nepal. At a workshop
held today in Kathmandu, senior representatives from government, the financial
sector, and international organizations came together to share information,
propose ideas, and build a consensus on how Nepal’s financial sector can
better identify, manage and mitigate risks.
“We want to help financial institutions
effectively manage environmental and social risks associated with the projects
they finance and increase support to businesses that are greener, climate
friendly, and socially inclusive,” said NRB Deputy Governor Mr Shiba Raj
Shrestha. “It is vital that financial institutions come together to establish
an effective and robust environmental and social management system.”
As a member of IFC’s Sustainable Banking
Network (SBN), NRB also benefits from the experience and knowledge of other
members. The SBN works with associations and regulators to level the playing
field for banks and encourage green investment. To date, 15 SBN member
countries have launched sustainable finance polices, guidelines and roadmaps.
“Financial institutions can strengthen
their portfolio by better assessing risks during loan or investment appraisal,
when considering projects,” said Rehan Rashid, Resident Representative,
IFC Nepal. “IFC has been a long-term partner for Nepal’s financial sector.
We help strengthen risk management, enhance competitiveness, and support
cross-border expansion by helping improve best practices in environmental
and social standards including Equator Principles and IFC’s Performance
Financial institutions have emerged
as ideally placed to help the private sector adapt to new economic realities
imposed by climate change impact. In Nepal, the financial sector plays
a leading role in sustainable economic growth through lending and investment
IFC is working with banking regulators
and financial institutions across Bangladesh, India and Sri Lanka as part
of the Sustainable Banking Network – of which NRB is an active member
from South Asia.
Nepal is a priority country for IFC.
IFC is sharpening its focus in Nepal to improving access to energy through
sustainable hydropower development; promoting financial inclusion; enabling
building tourism infrastructure and supporting job creation through investments
in manufacturing, agri-business and services industries. As of June 30,
2016, IFC’s committed portfolio is over $50 million. IFC uses a combination
of investments and advisory services to support private sector development
in Nepal to ensure growth is inclusive and balanced.
IFC, a member of the World Bank Group,
is the largest global development institution focused on the private sector
in emerging markets. Working with 2,000 businesses worldwide, we use our
six decades of experience to create opportunity where it’s needed most.
In FY16, our long-term investments in developing countries rose to nearly
$19 billion, leveraging our capital, expertise and influence to help the
private sector end extreme poverty and boost shared prosperity. For more
information, visit www.ifc.org.
About IFC-supported Sustainable Banking
The Sustainable Banking Network (SBN)
is a knowledge and capacity-building platform of financial regulators,
banking associations, and environmental regulators from emerging markets
interested in developing sustainable finance frameworks based on national
context and priorities, as well as international good practices. IFC acts
as the Secretariat of the Network, playing the role of facilitator and
Technical Adviser to SBN. SBN membership now consists of 31 member countries,
which represent over 85 percent of the banking assets across emerging markets.
For more information on the Sustainable Banking Network, visit www.ifc.org/sbn.