HSBC Malaysia To Continue Lending To Oil Palm, Timber Cos
December 05, 2008:
KUALA LUMPUR -(Dow Jones)- HSBC Bank Malaysia Bhd. Friday said it will continue doing business with oil palm and timber plantations, provided they comply with lending guidelines for forestry products.
However, the company has identified a few business customers who don't fully comply with HSBC's sector guidelines.
"We have identified a small number of clients that are yet to be fully compliant...This doesn't necessarily mean that we will exit clients in this category," Irene Dorner, chief executive, HSBC Bank Malaysia Bhd., said in a statement.
Earlier this week, media reports from Poland said that HSBC plans to terminate relationships with around 30% of its clients in forest-related products such as oil palm due to environmental concerns.
"Where a client has not made material progress towards meeting our standards...then we may have to exit that relationship as a last resort," said Dorner.
She said the bank continues to provide new facilities to clients that meet its criteria.
Dorner said HSBC Malaysia is actively engaged with individual clients who have time-bound credible action plans to ensure compliance with the bank's guidelines for lending for forestry products.
Environmental activists have been campaigning against expanding acreage of oil palm, particularly in Indonesia, arguing that this is leading to deforestation.
-By Sameer Mohindru, Dow Jones Newswires; (603) 2078-4233; sameer.mohindru@ dowjones.com
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