AET gets shipping’s first sustainability-linked Islamic RCF in South Asia

Maybank Singapore has extended a $100 million sustainability-linked Islamic revolving credit facility (RCF-i) to AET, a Singapore-based petroleum logistics unit of Malaysian energy logistics group MISC Berhad.

As informed, the landmark transaction marks the first such facility in the shipping industry in Southeast Asia, demonstrating both Maybank and AET’s commitments to net-zero greenhouse gas (GHG) emissions.

The RCF-i will support AET’s strategic initiatives to reduce its fleet’s GHG emissions intensity by 40 percent by 2030 (against the 2008 baseline) and achieve its long-term commitment to net-zero GHG emissions by 2050.

AET has been pioneering investments in LNG dual-fuel tankers with ten vessels already in its portfolio today and is taking the lead with future-focused industry players in the ongoing development of zero-emission vessels. Furthermore, AET is also looking to invest in new assets and businesses that support the energy transition. This RCF-i can be used to fund such low-carbon initiatives and decarbonization efforts.

The transaction is also seen as a good example of collaboration between the financing and shipping sectors to reduce the carbon footprint in the shipping industry.

“Today, we mark another important milestone with AET’s first sustainability-linked Islamic RCF in the shipping industry in Southeast Asia as a further endorsement of our sustainability agenda. With this RCF-i, based on Shariah principles, we are strengthening our relationship with like-minded partner Maybank, in our collaborative efforts towards the decarbonisation of the shipping sector and AET’s commitment to deliver more energy with less emissions,” Zahid Osman, President & CEO of AET, said.

“We are pleased to partner AET in its sustainability journey by being the first bank to offer a sustainability-linked Islamic RCF for the shipping industry in Southeast Asia. We are also embracing ethical banking principles to promote and enhance sustainable development through the principles of protection of the environment. We are well-placed as the go-to-bank for holistic, sustainable and Shariah-compliant solutions, and to work with organisations that are committed to achieving more sustainable outcomes,” Dato’ Mohamed Rafique Merican, Maybank Islamic Group CEO, commented.

“As a purpose-driven bank with a footprint in 10 markets in Southeast Asia, we are committed to drive long-term value creation for businesses and communities, remaining true to our mission of Humanising Financial Services. This maiden sustainability-linked Islamic transaction offers a fixed ceiling rate to provide an element of certainty to AET in this volatile environment, and there is no compounding of charges in the event of late payments,” Gregory Seow, Head of Global Banking at Maybank Singapore, added.