Union Bank secures sustainability-linked loan of USD 1.5 bn

Union Bank of India on Tuesday said it has secured a sustainability-linked loan aggregating to a total syndicated facility of USD 1.5 billion about Rs 11,050 crore from one of the leading trading corporates globally. The tenor of the syndicated loan is three years and the coupon rate is LIBOR 155 basis points per annum, the state-owned bank said in a release.

Union Bank of India on Tuesday said it has secured a sustainability-linked loan aggregating to a total syndicated facility of USD 1.5 billion (about Rs 11,050 crore) from one of the leading trading corporates globally. The tenor of the syndicated loan is three years and the coupon rate is LIBOR + 155 basis points per annum, the state-owned bank said in a release. The loan was secured through the lender's international banking division.

Under the facility, the lender will include three Key Performance Indicators (KPIs) relating to a reduction in greenhouse gas emissions, responsible sourcing of metals and growing renewable power portfolio. The sustainability-linked KPIs will have to be tested annually and verified by a third-party expert, the release said. Under this structure, the interest rate paid by the borrower on the credit facilities will decrease or increase based on the group's progress on the three KPIs, it added.