Reporting – Bank Muscat S.A.O.G. (2016)

Adoption Date:18 August 2007
Country of Headquarters:Sultanate of Oman
Region of Headquarters:Middle East
Institutional Reporting Hyperlink:http://www.bankmuscat.com/en-us/CSR/Pages/default.aspx
Current EPFI Reporting Year/Period:2016
EPFI Reporting in Compliance:Yes

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 above.

PROJECT FINANCE ADVISORY SERVICES

Total number mandated in the reporting period: 0

PROJECT FINANCE TRANSACTIONS

Total number that reached financial close in the reporting period: 3

Totals030
Totals030
SectorCategory ACategory BCategory C
Mining
Infrastructure1
Oil & Gas
Power2
Others
RegionCategory ACategory BCategory C
Americas
Europe, Middle East & Africa3
Asia Pacific
Country DesignationCategory ACategory BCategory C
Designated1
Non-Designated3
Independent ReviewCategory ACategory BCategory C
Yes3
No

1Designated Countries are those countries deemed to have robust environmental and social governance, legislation systems and institutional capacity designed to protect their people and the natural environment. For the list of Designated Countries, go to: http://www.equator-principles.com/index.php/ep3/designated-countries

PROJECT NAME REPORTING FOR PROJECT FINANCE TRANSACTIONS

No.Project NameSectorHost Country Name/ Project LocationYear of Financial Close
1Ad-Dhahirah Generating Company SAOCPowerOman2016
2Shinas Generating Co. SAOCPowerOman2016
3Myah Gulf Oman Desalination Company SAOCInfrastructureOman2016

PROJECT-RELATED CORPORATE LOANS

Total number that reached financial close in the reporting period: 0

IMPLEMENTATION OF THE EQUATOR PRINCIPLES

Since 2007, the bank has been one of the signatories to the Equator Principles. We have adopted the Equator Principles to ensure that the Projects we finance and advise on are developed in a manner that is socially responsible and reflects sound environmental management practice. We recognize the importance of climate change, biodiversity and human rights and believe negative impacts on project-affected ecosystems, communities, and the climate should be avoided where possible. We believe that adoption of and adherence to the Equator Principles offers significant benefit to us, our client, and local stakeholders.

The Principles were initially launched in 2003 and on June 4, 2013 – the 10th Anniversary since the launch of the Principles – the new version EPIII was issued.

The Bank applies the Equator principles to project finance:

• on a bilateral basis where the total project capital cost is of US$10 Million or more

• Project Finance Advisory services where total project capital cost is US$10 Million or more.

• Participation in project related Corporate loans on a club or Syndicated basis where all four of the following criteria are met:

i) The majority of the loan is related to a single project over which the client has effective control

ii) The total aggregate of loan amount is at least US$100 million

iii) The Bank’s commitment before syndication or sell down is at least US$50 M

iv) The loan tenor is at least two years.

• Bridge loan with a tenor of less than 2 years that are intended to be refinanced by project finance or project related corporate loan that is anticipated to meet the relevant criteria described above.

When a project is proposed for financing the bank as part of its internal environmental and social review and due diligence, subject to screening and is categorized based on the environmental and social categorization process of the International Finance Corporation (IFC).

The categories are:

Category A: Projects with significant adverse environmental and social risks and or impacts those are diverse, irreversible or unprecedented.

Category B: Projects with potential limited adverse environmental and social risks and/or impacts that are few in number, generally site-specific, largely reversible and readily addressed through mitigation measures; and

Category C- Projects with minimal or no adverse environmental and social risks and/or impacts.

Implementation:

Project related corporate loan proposals are screened by the Relationship Managers as per the SEMS policy of the Bank and the IFC guidelines for categorization. The classification are captured in the credit proposal and are reviewed by the Risk Management department.

In line with the Banks SEMS For large industrial, oil & gas and infrastructure projects where the bank extends the project finance assessment is conducted by Independent lender’s Technical consultants. Under the scope of engagement the Consultants submits their initial SEMS assessment report on the projects followed by periodical reports to the lenders and the Borrower to ensure the project is in compliance with regulation, permits and approvals under the host country laws.

The reports periodically reviewed and recommendation thereof are incorporated in to the action plan for implementation.

Categorization of the project is made based on the assessment report in line with the Bank’s SEMS policy.

In the loan documentations, the Borrower will covenant to comply with the Equator Principles, relevant host country environmental and social laws, regulations and permits in all material aspect.

Further information can be found at: http://www.bankmuscat.com/en-us/CSR/Pages/default.aspx