2021 ESG Report

47 2021 ESG Report Green Finance Development Green Finance Products CRCBANK 48 With its financial advantages, credit advantages and information products, CSRC Bank takes the initiative to fulfill its social responsibilities, does a good job of providing loan support to energy-saving, emission reduction and urban infrastructure projects, promotes green production and consumption, and strives to achieve good social and economic benefits. CSRC Bank has formulated the Green Finance Development Strategy (2020-2025) of Jiangsu Changshu Rural Commercial Bank, which includes the three major tasks of preventing environmental and social risks, accelerating the development of green business, and improving the performance of ESG itself. It also integrates the concept of green environmental protection and green development into all business management activities to effectively support the development of green finance business. In 2021, CSRC Bank established the Green Finance Department and the Green Low Carbon Transformation Financial Service Center, following the principles of full coverage, checks and balances, prudence and matching to carry out internal control. In order to build solid foundation for the development of our green finance, we implement the Four Guarantees and Six Enhancements of the regulatory authorities, the Green Finance Evaluation Program for Banking Financial Institutions, the Opinions on Green Low Carbon Financial Reform and Innovation in Suzhou and the Green Finance Development Strategy of CSRC Bank. CSRC Bank has set up a "green channel" fast approval mechanism. This mechanism strengthened information system construction, optimized customer rating system, and improved credit allocation standards to enhance the bank's organizational capacity to develop green finance and provide a strong guarantee to promote the development of green economy. CSRC Bank actively researches, innovates green products, enriches the Green Finance "product library". We have increased the construction of green financial products and service innovation mechanisms related to green, low- carbon and circular economy and strengthened the innovation of green credit products for "three rural" and small and micro businesses. We have also developed and introduced a series of standardized loan financing models and low- carbon financial products in a timely manner. In the reporting period, CSRC Bank achieved remarkable performance in green finance, with total green credit 1.560 billion RMB, supporting 34 enterprises, and a loan growth rate of 23%. with total green credit 15.60 billion RMB Loan Type Supporting 34 enterprises with a loan growth rate of 23% Loan Usage "Green Channel" and "Fast Track" We have introduced a "green channel" approval mechanism and a "fast track" loan review model to provide a green channel for credit approval for green, low-carbon, circular economy and other green credit businesses and customers, simplify credit information for high-quality green financing projects, and streamline the credit approval process. Strengthening Information System We strengthened the construction of information systems, embeded customer environmental and social risk classification indicators into the credit process system, and realized the whole process display of risk information. We also incorporated external environmental violations and other risk information into the internal management system to further enhance risk warning and control capabilities. Emission Loan Su Carbon Loan Borrowers who hold emission rights obtained for a fee and confirmed in the form of emission permits apply to CSRC Bank for RMB working capital loans for their normal production and operation Working capital loans granted by the Bank to agricultural-related, micro and small business and private enterprises in the green enterprise directory database, which are supported by the Central Bank Funds of Jiangsu Province. It is mainly used for enterprises' energy-saving and environmental protection transformation and capital needs arising from daily production and operation activities. It is mainly used for the capital needs of energy- saving and carbon-reducing projects of enterprises, or the capital needs arising from the daily operation activities of energy-saving and carbon-reducing enterprises. Improving Credit Allocation Standards By building a green credit policy and management system guided by "One Policy" and guaranteed by "Four Mechanisms" and strictly controlling the credit investment in "High Pollution, High Energy Use and Overcapacity "industries, our green credit business has shown a healthy growth trend year by year. Optimizing Customer Rating System Relying on the comprehensive risk monitoring and early warning platform to carry out environmental and social risk monitoring, environmental information is incorporated into the customer rating system, and customers with bad environmental records will be forced to downgrade their ratings in the rating system. Environmental Protection Loan A financial product jointly established by Jiangsu Provincial Department of Finance, Provincial Department of Ecology and Environment and Jiangsu Rural Credit Cooperative Society. Through the establishment of a risk compensation fund pool for ecological and environmental protection projects, we aim to provide loan credit and risk compensation for pollution prevention and control, ecological protection and restoration, environmental protection infrastructure construction and environmental protection industry development projects carried out by enterprises in Jiangsu Province. It can be used for energy and water conservation projects, ecological protection and restoration projects, resource recycling projects, pollution prevention and control projects, renewable energy and clean energy projects, energy conservation and environmental protection services projects, and other environmental projects audited and approved by the provincial assessment center.

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