Allied Irish Banks, p.l.c (First Year Implementation)
|Adoption Date:||21 Oct 2021|
|Country of Headquarters:||Ireland|
|Region of Headquarters:||Europe|
|Current EPFI Reporting Year/Period:||2022|
|Institutional Reporting:||No Report Available|
Please read the important notes and disclaimer for further information on ‘EPFI Reporting’, compliance and publication on the Equator Principles Association website.
Further information on this EPFI may be obtained through the Institutional Reporting hyperlink.
Implementation of the Equator Principles
Applying the Equator Principles at Allied Irish Banks:
The Equator Principles is a risk management framework for financial institutions for determining, assessing and managing environmental and social risk in projects. The Equator Principles is primarily intended to provide a minimum standard for due diligence to support responsible decision making.
The scope of the Equator Principles applies to;
- Project Finance
- Project related corporate loans
- Bridge loan for subsequent project finance
- Project related advisory services
- Project related refinancing and project related acquisition financing
AIB signed up to the Equator principles in October 2021. As part of this commitment, we have implemented the Equator Principles in our procedures and standards for project financing and we will not finance loans in scope of the Equator Principles where the loan does not able comply with these principles.
AIB’s Approach to the compliance with the Equator Principles:
AIB’s approach to environmental and social risk is set out in our ESG Framework. Under the ESG Framework, all financing should adhere to international conventions and guidelines to respect human rights and the environment. AIB takes part in a number of voluntary commitments that focuses on ESG, including the Equator Principles. The ESG Framework sets the roles and responsibility for ESG risk across the bank.
AIB’s Group Credit Risk Policy includes an Exclusions List that identifies a number of sectors that AIB does not lend to. A number of these sectors, that are classified as Category A (i.e. potential significant environment and social risk projects) under the Equator Principles, are included in the Exclusion List; these sectors include, inter alia, exploration of Oil & Gas, Nuclear Power, Coal or Oil Fired Power generation, Natural Gas fracking etc.
As a signatory to the Equator Principles, all lending under AIB’s Group Project Finance Policy will be required to comply with the Equator Principles, and, therefore, the applicable business unit procedures have been updated to ensure that in-scope project-related finance transactions consider all aspects of the Equator Principles in relation to the identification, assessment, categorisation of environmental and social risk, and ongoing management and reporting requirements.
All Relationship Managers responsible for the identification of environmental and social risk within project finance transactions have undertaken Equator Principles training. In addition, we have developed and rolled out an EP Categorisation Assessment to assist Relationship Managers with the identification and categorisation of a project into Category A, B+, B & C. The EP Categorisation Assessment is essentially a checklist and guide to assist the affected business units to identify and classify potential environmental and social risk so that it can be pre-emptively and proactively managed by working with the client and ensuring the legal and technical scope of works for the project includes the Equator Principles.
Upon the identification of a Category A or Category B+ project, our process requires that an independent external review of the project’s environmental and social risk is carried out by an independent consultant to review the project’s compliance with the Equator Principles to ensure that issues identified have an appropriate remediation put in place & post transactional monitoring is adhered to. The Head of a Business Unit (or a senior delegate) is required to sign off on the assessment of each applicable project finance transaction against these principles.
Reporting: As a signatory to the Equator Principles, after the completion of the grace period, we will expand our annual sustainability reporting to include information on project-related finance transactions in the scope of the Equator Principles and that have reached financial close.