- Interest-free Westpac Warm Up loans expanded with aim of $100m in lending
- Sustainable Agribusiness Loan pilot set to begin
- Westpac Group signs up to Net-Zero Banking Alliance
- Responsible Banking and Investment Position released
Westpac NZ is expanding its interest-free loans that help customers make their homes warmer, healthier and more energy efficient, as part of a package of sustainability announcements.
The bank is also piloting a new sustainable finance loan for farming customers, has announced a new commitment to align its banking operations with a net zero emissions future and has released a new Responsible Banking and Investment Position.
Westpac NZ chief executive Catherine McGrath says the bank is focused on supporting customers who want to take positive action.
“Climate change is a growing threat to our environment, communities and business. Cutting emissions reduces risk, helps protect the world we live in for future generations and also creates opportunities to do things in new ways.
“Over the past 10 years we’ve reduced emissions from our own operations at Westpac NZ by 60%. With today’s announcement we’re lifting our game across the bank to support our customers to reduce their carbon emissions.
“Our expanded Westpac Warm Up loan will allow customers to borrow up to $40,000 interest-free to make their home warmer, drier, more sustainable and energy efficient. EV charging equipment and solar batteries can now be funded through the loan, alongside existing options for clean heating, insulation, ventilation and other improvements.
“We’ve already lent more than $30 million interest-free through Westpac Warm Up and aim to get to $100 million. As well as supporting customers to live more sustainably, these loans also help with cost of living pressures through the zero interest charged and in many cases reduced energy costs.”
Ms McGrath says Westpac NZ is also piloting new Sustainable Agribusiness Loans with a small group of farming customers.
“The loan is the first of its kind to require a customer to meet all parts of the Sustainable Agriculture Finance Initiative guidance. This guidance includes practices to reduce emissions, improve long-term resilience and deliver more sustainable outcomes in terms of water, waste, pollution and ecosystems.”
Once farmers commit to meet the guidance, they have two years to achieve that goal and will be supported with discounted loan pricing.
“Agriculture is a key part of New Zealand’s economy and we provide high-quality food and produce to the world. It’s important we take an innovative approach to lending in order to help our customers achieve their sustainability goals, while remaining productive.”
The loans are expected to be rolled out more widely next year.
Ms McGrath says Westpac Group, including Westpac NZ, has today announced it has signed up to the UN-convened Net-Zero Banking Alliance.
“This confirms Westpac’s commitment to a net zero lending portfolio by 2050, while also setting lending emissions targets for 2030.
“Moving forward, we’ll be working closely with our big business customers – in certain sectors – that want to access lending, to establish how they’re managing climate-related risk and what they’re doing to decarbonise.”
Ms McGrath says the bank is speeding up its response to climate change.
“We know New Zealanders want more than promises and platitudes from businesses when it comes to climate change. We’re taking action in our own business and these initiatives provide tangible pathways for customers who want to take action as well.”
The release of Westpac NZ’s Responsible Banking and Investment Position wraps together the way environmental, social and governance factors guide activity across the bank in a clear and simple summary for customers.
“It also spells out plainly where we’re not willing to do business. For example we don’t lend to coal mining companies, or provide banking services to payday lenders and mobile truck shops.”
Summary of today’s announcements
- Westpac Warm Up: Westpac Warm Up loans enable home loan customers to access interest-free lending to make their home warmer, drier, healthier and more energy efficient through the purchase of insulation, heat pumps, double glazing, ventilation, efficient wood burners and solar power. Today’s announcement means the limit on lending increases from $10,000 over five years to $40,000 over five years, and EV charging equipment and home battery packs can now also be purchased using the loan. https://www.westpac.co.nz/home-loans-mortgages/options/warm-up/
- Sustainable Agribusiness Loan: This pilot will support farmers who are committed to improving their on-farm sustainability practices. Customers will receive discounted lending rates when they commit to achieve on-farm sustainability outcomes that enable them to meet in full the Sustainable Agriculture Finance Initiative guidance. A full rollout of the loans is expected in 2023.
- Net-Zero Banking Alliance (NZBA): Westpac Group has today signed up to the Alliance, and has set sector emissions targets, spanning power generation, upstream oil & gas and cement production. In practice, this means large companies will need to provide a credible transition plan in line with a 1.5 degree future or face changes to the way they are lent money. Other sector targets will be announced in future. Westpac Group has also set a sector target for thermal coal, however Westpac NZ does not lend to this sector.
- Responsible Banking and Investment Position: This position sets out the way Westpac NZ incorporates environmental, social and governance considerations in decision making, spanning lending, investments and other areas of the bank. https://www.westpac.co.nz/about-us/sustainability-community/responsible-banking