MUFG Bank, a consolidated subsidiary of MUFG and the largest bank in Japan, has become a signatory to the Poseidon Principles.
With the latest member, a total of 24 financial institutions have now become signatories to the Principles with a portfolio of over $150 billion in loans to international shipping.
Under the framework, MUFG Bank will calculate vessels’ carbon intensity and will disclose the results of annual assessments of the climate alignment of its shipping finance portfolio.
“By joining the Poseidon Principles network, we are doing our part to transition to low-carbon economy and contribute to the sustainability of the shipping industry. We will also support our clients and fellow signatories in their endeavors to accomplish similar goals,” the bank said.
The joining of MUFG Bank to Poseidon Principles solidifies the participation of Asian financial groups in the framework and comes on the heels of Sumitomo Mitsui Banking Corporation’s membership announced last month .
The general idea behind the framework is for the signatory banks, as capital providers, to support the objectives of the International Maritime Organization (IMO), the primary issue being climate change.
The core trajectory being followed is the IMO target of cutting the shipping industry’s greenhouse gas (GHG) emissions by 50 percent by 2050 when compared to 2008 levels.
The key four principles include:
The first disclosure report from the original 15 signatories of the Poseidon Principles released in December 220 shows that the ship finance portfolios of three banks are aligned with the UN decarbonization targets while those of the remaining 12 banks are not.
The portfolio assessment builds on 2019 emissions data from shipping clients compared to a decarbonization trajectory for the same year.