GCPF Strengthens Partnership with Mongolia’s Largest Bank
Share
Zurich/Ulaanbaatar, 17 December The Global Climate Partnership Fund (GCPF), managed by Swiss impact asset manager responsAbility, has extended its partnership with Khan Bank. Through a credit line of USD 15 million, the collaboration focuses on energy efficiency and renewable energy projects that reduce CO₂ emissions and improve living conditions in Mongolia.
Mongolia ranks among the most climate-vulnerable countries in the world, facing extreme climatic challenges. Over the past 70 years, the average temperature has increased by 2.07°C, resulting in more frequent and intense extreme weather events such as long winter periods (Dzud), droughts, floods, desertification, and sandstorms. Particularly affected is the capital, Ulaanbaatar, where nearly all power and heat are derived from coal-fired power plants. This dependency leads to extremely high emission levels – especially in winter, when pollution levels exceed WHO-recommended limits by up to 27 times – making Ulaanbaatar one of the world’s most polluted cities.
Projects financed by Khan Bank and climate impactInnovative project for energy-efficient housing
Under this partnership several energy efficiency projects have already been financed, contributing to both CO₂ reduction and improved living conditions in Mongolia. These include:
- USD 14.9 million for energy-efficient industrial equipment: Supporting Mongolia’s food and dairy industries by introducing modern equipment, which strengthens livelihoods in the country’s nomadic communities reliant on livestock and dairy production.
- USD 4.6 million for energy-efficient greenhouses: Introducing innovative greenhouse technologies enable year-round vegetable production under extreme weather conditions, bolstering food security and reducing reliance on imports.
- USD 2.7 million for energy-efficient building measures: Projects such as the modernisation of the historic Ulaanbaatar Hotel enhance energy efficiency, reduce emissions, and improve the quality of urban life.
As of Q2 2024, these projects have achieved remarkable results, saving 260,152 MWh of energy – equivalent to the annual consumption of 40,000 average Mongolian households1 – and reducing CO₂ emissions by 0.25 million tons, comparable to the annual emissions of approximately 54,000 cars2.
Khan Bank: a dedicated and innovative partner in green finance
Since partnering with responsAbility in 2021, Khan Bank emerged as a leader in green finance in Mongolia, leveraging its nationwide presence and innovative approaches to drive sustainability. For its contributions, Khan Bank received an Honorable Mention at the Global Climate Partnership Award in 2024. Special recognition was given to its sustainable loans for nomadic herders who practice certified environmentally friendly techniques. These projects model the integration of climate mitigation and adaptation measures and play a key role in counteracting land degradation from overgrazing in Mongolia.
David Diaz Formidoni, Head of Financial Institutions Investments, Climate Finance at responsAbility, said: “Our continued collaboration with Khan Bank reinforces our shared vision of a more sustainable and resilient Mongolian economy. The innovative projects enabled by this partnership make a valuable contribution to CO₂ reduction and to improving living standards in one of the world’s most climate-vulnerable countries.”
Erdenedelger Bavlai, First Deputy CEO of Khan Bank, said: “Green finance lies at the heart of our corporate strategy. Partnering with responsAbility allows us to implement innovative solutions to combat climate change and reduce CO₂ while supporting our local communities. Together, we are dedicated to creating a more sustainable future for Mongolia.”
About the Global Climate Partnership Fund (GCPF)
The Global Climate Partnership was established by the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU), KfW Entwicklungsbank and the International Finance Corporation (IFC) in 2009 as a public-private partnership. Junior catalytic capital is provided by BMU, the department for Business, Energy and Industrial Strategy (BEIS) of the UK, Denmark’s development cooperation (Danida). Other private and public investors include ASN Bank, Ärzteversorgung Westfalen-Lippe, FMO, OeEB, Sparkasse Bremen, the European Investment Bank (EIB) and Heilsarmee.
About responsAbility Investments AG
responsAbility Investments AG is a leading impact asset manager specializing in private market investments across three investment themes. These themes directly contribute to the United Nations Sustainable Development Goals (SDGs): Financial Inclusion, to finance the growth of Micro & SMEs; Climate Finance, to contribute to a net zero pathway; and Sustainable Food, to sustainably feed an ever-growing population. All responsAbility investment solutions target specific measurable impact alongside market returns.
Since its inception in 2003, responsAbility has deployed over USD 15.7 billion in impact investments. With over 270 employees collaborating across 8 offices, as of 30 September 2024 the company manages USD 5.1 billion in assets across approximately 300 portfolio companies in around 70 countries. Since 2022, responsAbility has been part of M&G plc, the international savings, and investments business, and contributes to enhancing M&G’s capabilities in impact investing.
About Khan Bank
Khan Bank serves over 82% of its population, offering comprehensive banking services through its 547 branches and digital platforms. Over the past decade, the Bank has prioritized sustainable development, promoting environmentally responsible products and solutions to support Mongolia’s transition to greener future.
