Project finance
Our institutional banking and capital markets business, nabCapital, provides project finance to facilitate economic and infrastructure development, which we believe benefits both industry and communities.
In June 2007, our Board approved adoption of the Equator Principles and will now apply them to our project finance lending. We publicly announced this in October 2007.
When we assess project finance opportunities within high income Organisation for Economic Co operation and Development (OECD) countries, we evaluate them for compliance with the relevant domestic regulatory requirements.
For projects in all other countries, we apply International Finance Corporation (IFC) and World Bank safeguard policies (as a minimum). We apply these policies - regardless of the monetary value of the project - if there are concerns that environmental habitats, Indigenous peoples and community rights may be at risk. Our internal standards require an environmental impact assessment for all projects we finance.
We apply our specialised finance environmental risk policy to all our project finance deals. The technical review of these deals is managed from Australia.
Our assessment and management of risk in project financing is based on independent expert due diligence, active risk management and continual review of policy specifically applicable to project finance. We have identified a wide range of environmentally sensitive industries which require a higher level of due diligence.
Each year, we review the performance of our project finance portfolios' assets. This review may assess actual environmental performance of the financed asset against the contractually required baseline performance.
We require our project finance clients to consider environmental compliance risks and we encourage them to consider broader social and environmental risks - and to seek and follow relevant expert advice.
We provide an annual update on our project finance and our implementation of the Equator Principles in our CR Reporting.