Sustainability-connected loan arrangement advised for maritime firm by WFW
In a significant move towards environmental and social sustainability in the shipping industry, Pacific Basin Shipping has secured a seven-year sustainability-linked senior secured committed revolving credit facility worth USD 250 million. This facility, syndicated by Credit Agricole Corporate and Investment Bank, Iyo Bank Limited, KDB Asia Limited, Standard Chartered Bank, SBI Shinsei Bank Limited, and Skandinaviska Enskilda Banken, links financial terms to crew safety performance and carbon intensity reduction.
The facility is built around a tiered pricing mechanism, whereby the margin of interest is adjusted according to Pacific Basin's performance against predetermined key performance indicators (KPIs) and annual sustainability performance targets (SPTs). The KPIs focus on measurable safety outcomes for the crew onboard, a critical social aspect of ESG considerations in shipping, and the reduction of carbon emissions per unit of transport work, reflecting environmental sustainability efforts.
However, the exact numerical targets and methodologies for these KPIs in Pacific Basin's credit facility have not been detailed explicitly in the publicly available documents. The sustainability performance targets for Pacific Basin include targets related to crew safety and carbon intensity.
Martin Fruergaard, CEO of Pacific Basin Shipping, stated that the facility extends their funding profile, reinforces their commitment to sustainable shipping, and strengthens their financial capacity. The facility syndicate oversubscription reflects the market's support for Pacific Basin, their growth strategy, and their initiatives to drive the resilience and long-term financial performance of their company.
Pacific Basin Shipping, headquartered in Hong Kong, operates a fleet of 260 ships, transporting various types of cargo for global commodity groups. On July 28, 2025, the legal firm Watson, Farley & Williams (WFW) provided counsel to Pacific Basin Shipping. BNP Paribas acted as the sustainability coordinator for the facility.
WFW's Madeline Leong expressed delight in continuing the firm's relationship with Pacific Basin and supporting their sustainability-linked financing. The sustainability-linked senior secured committed revolving credit facility is linked with predetermined KPIs and targets related to sustainability. The facility will be used for general corporate purposes.
This approach reflects a growing trend towards embedding green and social KPIs in financing arrangements to drive accountability and sustainability improvements in the shipping industry. Pacific Basin's commitment to sustainability includes a net-zero target by 2050. The company's fleet consists of Handysize, Supramax, and Ultramax dry bulk shipping vessels.
In summary, Pacific Basin Shipping has secured a sustainability-linked credit facility that links financial terms to crew safety performance and carbon intensity reduction, with specific KPIs and SPTs governing these metrics, although exact target figures are not publicly disclosed. The facility underscores the company's commitment to sustainable shipping and reflects a growing trend towards embedding ESG considerations in financing arrangements.
- This sustainability-linked senior secured committed revolving credit facility, secured by Pacific Basin Shipping, is not only associated with general corporate purposes but also linked with environmental-science-focused key performance indicators (KPIs) and sustainability performance targets (SPTs) related to climate-change mitigation, such as the reduction of carbon emissions.
- The shipping industry's financial sector, including Credit Agricole Corporate and Investment Bank, Iyo Bank Limited, KDB Asia Limited, Standard Chartered Bank, SBI Shinsei Bank Limited, Skandinaviska Enskilda Banken, and BNP Paribas, are showing a keen interest in science and sustainability, as evidenced by their support for Pacific Basin's environmental-science-driven initiatives and the development of sustainability-linked financing.
