We disclose emissions related to all loans and credit lines (included in the balance sheet records) to companies, non-profit organisations and any other entities. These loans are not traded on the market and are for general corporate purposes, i.e. with no specified use of the funds, as defined in the GHG Protocol. We include here also emissions from our material corporate bond exposures. The business loans category represents the predominant share of financed emissions.
For this part of the portfolio, estimated emissions are calculated on the basis of data collected from the client’s reports (resulting in the highest Data Quality Score = 1) or based on the size of the company (capital and own assets), its revenue and type of business. In the absence of sufficient client information, emissivity is calculated based on the amount of exposure and the client’s type of business (lowest Data Quality Score = 5). We are currently working to collect as much emissivity information as possible directly from the client in the future, thus strengthening the relationship and establishing a dialogue to support their transformation. We have implemented a free carbon footprint calculator for small and medium-sized enterprises, which should also support the data collection and reporting process.
This category also includes financed projects, i.e., financing (recorded in the balance sheet) for specific investments or activities with a clearly identified use of the funds as defined in the GHG Protocol. For example, this could be the financing of a specific activity or activities, e.g. concerning a wind or photovoltaic farm or an energy efficiency project. Emissions are calculated only for the ring-fenced activities being financed. Emissions and financial data unrelated to the funded project are excluded. This is an important part of our business portfolio due to the significant volume of energy project financing, with a high share of RES projects (around 30% of the total energy portfolio). The data quality score for this category is better than in other categories (2.89) – we assume that the financed GHG emissions from this type of projects (RES) are approximately 0 and treat them as the actual reported emissions from the project.
Another category aggregated under this item includes commercial real estate (CRE) loans (recorded in the balance sheet) designated for specific corporate purposes: the purchase and refinancing of commercial real estate (CRE) and balance sheet investments in CRE, where the financial institution does not exercise operational control over the property. According to this definition, the financed property is used for commercial purposes, such as retail and service facilities, hotel, office, industrial, or residential spaces (large multi-family buildings for rental purposes). In all these cases, the property owner utilizes the real estate for profit-generating activities (general construction is outside the scope of CRE). The methodology for estimating emissions is described in the section on retail real estate ( below).