MAS to roll out US$2b green finance programme

THE Monetary Authority of Singapore (MAS) will launch a US$2 billion programme to accelerate the growth of Singapore's green finance ecosystem.

Known as the Green Investments Programme (GIP), MAS will channel funds to public market investment strategies with a strong green focus, and with asset managers who are committed to deepening green finance activities and capabilities in Singapore, said education minister and MAS board member Ong Ye Kung at the Singapore FinTech Festival x the Singapore Week of Innovation and TeCHnology (SWITCH) conference on Monday.

As part of the programme, the regulator will allocate US$100 million to the Bank for International Settlements' Green Bond Fund in support of its global green finance initiatives.

To reinforce industry efforts and build financial system resilience, MAS will also look to issue environmental risk management guidelines across banking, insurance and asset management sectors, said Mr Ong.

"These guidelines will set standards on governance, risk management and disclosure to encourage right-pricing of loans and investments, and thereby promote new opportunities for green investment," said Mr Ong. MAS will publish a consultation paper in the first quarter of 2020.

While green bonds have been gaining ground in the region, green lending is still at a nascent stage, said Mr Ong, who noted that this is an area with "significant potential" for growth.

In order to access green loans, firms will need to incur costs to develop sustainability frameworks and engage external reviewers. MAS will roll out grant schemes to help defray these costs, said Mr Ong.

"To make finance green in Asia, we need to make green lending not a niche activity, but mainstream," he added.