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Annual Report on Bank of China’s Green Bonds
Bank of China (“BOC”) Green Bonds enables BOC to support environment friendly projects and companies which
are particularly active in terms of environment preservation, energy transition or climate change mitigation. As
stated in the Offering Circular as well as Bank of China Green Bond Management Statement (“the Management
Statement”)1, we hereby provide BOC Green Bonds Annual Report, disclosing the allocation of the bond proceeds
as well as the expected environmental impacts of the Eligible Green Projects as of 31st December, 2017.
Outstanding BOC Green Bonds
Issue Date
Maturity
(year) Currency
Amount
(million)
CNY Equivalent Amount
(million)
Green Bond 1
2016/7/5 3 USD 500 3,348
2016/7/5 3 USD 750 5,021
2016/7/5 5 USD 1,000 6,695
2016/7/5 5 EUR 500 3,701
2016/7/5 2 CNY 1,500 1,500
Green Bond 2 2016/11/3 3 USD 500 3,392
Green Bond 3
2017/11/15 5 USD 500 3,315
2017/11/15 3 EUR 700 5,449
2017/11/15 3 CNY 1000 1,000
Bond Details and Proceeds Allocation
Green Bond 1 was issued in the offshore market through Luxemburg Branch and New York Branch in July 2016.
The total amount equated to CNY 20,265 million, and the net proceeds equated to CNY20,224 million. As of
December 31, 2017, all of these net proceeds had been utilized to fund 8 metro projects, 3 wind power generation
projects, 1 waste water treatment project and 1 solar power generation project.
Green Bond 2 was China Green Covered Bond and issued in the offshore market through London Branch in
November 2016. The total amount equated to CNY 3,392 million, and the net proceeds equivalents to CNY 3,381
million. As of December 31, 2017, all of these net proceeds had been utilized to fund 9 wind power generation
projects, 2 waste water treatment projects and 1 solar power generation project.
Green Bond 3 was certified by Climate Bond Initiative (CBI) and issued in the offshore market through Paris Branch
in November 2017. The total amount equated to CNY 9,763 million, and net proceeds equated to CNY9,753 million.
1 available at http://www.boc.cn/en/investor/ir10/
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As of December 31, 2017, 92% of net proceeds had been utilized to fund 11 metro projects, 2 wind power
generation projects.
All the BOC Green Bonds are in alignment with Green Bond Principles (GBP) published by the Executive Committee
of Green Bond Principles, with the International Capital Market Association (ICMA) serving as Secretariat.
Impact Reporting
Below shows the expected environmental impacts in detail. Due to the confidential considerations for our loan
clients, the impact results are disclosed on a portfolio basis. For each of the indicators in the table, the project-by-
project results include only the pro-rated share (as a percentage of the issuer's share of the total financing) of the
total projects’ results; these individual pro-rata project impacts are then aggregated to indicate the overall impact
of the funded projects in a certain category.
The environmental impacts are calculated in categories. The impacts of the Renewable Energy Projects refer to the
UNFCCC CDM methodology ACM 0002 Grid-connected electricity generation from renewable sources (version
17.0)2. Noted by * in the table below.
For Waste Water Treatment Projects, the environmental impacts are calculated based on the capacity of the
treatment effectiveness (waste water treatment = treatment capacity of the facility * (influent quality - effluent
quality)). Noted by ** in the table below.
The impacts of the Clean Transportation Projects are calculated based on ACM0016 Mass rapid transit projects
(version 4.0)3. Noted by *** in the table below.
Renewable Energy
(Wind&Solar)
Allocated amount
(CNY million)
Annual
generation(MWh)
Renewable energy
capacity added(MW)
Annual GHG emissions
reduced*(CO2 tonnes)
1,239.10 699,850.52 639 615,948
Waste Water Treatment Allocated amount
(CNY million)
Annual pollution prevention**(tonnes)
COD NH3-N
500 1,343 90
Clean Transportation
(Electrified Metro)
Allocated amount
(CNY million)
Annual GHG emissions
reduced*** (CO2 tonnes)
18,485.36 68,748
2 available at http://cdm.unfccc.int/filestorage/D/5/Y/D5YFS9I3VKBT18MQNGX0LPZ6U7AWCO/ACM0002_%28v17%200%29_clean.pdf?t=bGt8b2tiaTVtfDDXyk1Kj1cAVtGwMe6a7-hX 3 available at http://cdm.unfccc.int/filestorage/3/J/I/3JIUSA5XE4QH127BPK0WFN6DMZVYRT/EB85_repan10_ACM0016_ver_04.0.pdf?t=Z3V8b2tiaHJkfDBMg0eSxJTDh6CNRcIIWBxk
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Use of Proceeds
All the net proceeds of the Green Bonds will be allocated to Eligible Green Projects in the following categories:
• Renewable energy: the production and transmission of renewable energy, and the manufacturing of
renewable energy appliances and products; renewable energy includes solar energy and wind energy;
• Clean transportation: electric, public, rail, non-motorised, multi-modal transportation, infrastructure for clean
energy vehicles and reduction of harmful emissions, and rolling stocks or vehicles carrying fossil fuel products will
be excluded; and
• Sustainable water and wastewater management: sustainable infrastructure for purposes of water collection,
storage, treatment or distribution, or for flood protection or drought resilience.
Project Evaluation and Selection
BOC will follow the procedures below to evaluate and select the Eligible Green Projects:
1. Preliminary Screening
Domestic and overseas branches of BOC shall conduct a preliminary screening of potential projects in accordance
with the criteria and standards set out in BOC’s internal regulations and the Eligible Green Project categories as
described in the “Use of Proceeds” section in this Statement, and form a list of nominated projects which will be
submitted to the Headquarters for review.
2. Review and Approval
The Headquarters shall review each of the nominated projects for approval as Eligible Green Projects. The approved
projects will form an Eligible Green Project list.
3. Update and Maintenance
The Headquarters shall review the Eligible Green Project List on a quarterly basis and determine if any changes are
necessary (for example, if a project has amortized, been prepaid, sold or otherwise become ineligible). The
Headquarters shall organize domestic and overseas branches to nominate new projects, and approve the eligible
ones to replace projects that have amortized, been prepaid, sold or otherwise become ineligible.
Management of Proceeds
Due to its global network, BOC will allocate the net proceeds of the Green Bonds to Eligible Green Projects across
various domestic and overseas markets. BOC has established an effective mechanism to manage the proceeds,
ensuring that the proceeds from the Green Bonds will be used to fund the Eligible Green Projects.
1. Planning for Use of Proceeds
Prior to the issuance of Green Bonds, BOC shall evaluate the recent and pipeline capital spending and develop a
preliminary Eligible Green Project List in accordance with the procedures as described in the “Project Evaluation
and Selection” section in this Statement to ensure that the Green Bond proceeds can be allocated to Eligible Green
Projects in a timely manner.
2. Management of Separate Ledger
BOC shall record the source and allocation of proceeds in a separate ledger to ensure that all the net proceeds of
the Green Bonds are used to fund Eligible Green Projects. The ledger shall contain detailed information of the
capital source (including the issue amount, the coupon rate, the issue date and the maturity date of the Green
Bonds) and the capital allocation (including the project name, the borrower description, the project category, the
balance, the release date, the repayment date, and the interest rate of the loan). BOC will review and update the
ledger on a quarterly basis. Any proceeds allocated to the projects that have amortized, been prepaid, sold or
otherwise become ineligible shall be reallocated to newly nominated and approved Green Projects.
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3. Use of Unallocated Proceeds
Unallocated proceeds shall not be invested in greenhouse gas (GHG) intensive or highly polluting or energy
intensive projects. The unallocated proceeds could be temporarily invested in Green Bonds issued by non-financial
institutions in domestic or international markets, and in money market instruments with good credit rating and
market liquidity, or kept in cash until they are allocated to Eligible Green Projects.
Reporting
As long as the Green Bonds are outstanding, BOC will make and keep readily available up-to-date information on
the allocation of the proceeds and the environmental performance of the funded Eligible Green Projects on an
annual basis on its official website (http://www.boc.cn/en/investor/ir10/) and through other channels where
feasible, such as annual reports or social responsibility reports. BOC intends to maintain the transparency of
information disclosure following the best practices recommended by GBP, 2017. The following contents will be
disclosed annually:
1. A brief description of the Eligible Green Projects to which the Green Bonds proceeds were allocated, and the
amount and percentage allocated to each of the categories;
2.An attestation report issued by a specialized certification body assuring allocation of proceeds; and
3. The expected environmental impacts figures of the Eligible Green Projects to which the Green Bonds proceeds
have been allocated will be based on the financing share of the projects. BOC will adopt some quantitative
performance measures of certain categories, where feasible, and disclose them on an aggregated portfolio basis.
The environmental impact section will be reviewed by a specialized certification body.
In addition, BOC will confirm that the use of proceeds of the Green Bonds issuance conforms to this Statement on
its official website (http://www.boc.cn/en/investor/ir10/) on a quarterly basis.
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Appendix 1
Green Bond 1
Table 1 Detailed Information of Green Bond 1
ISIN code Currency Tenor
(year)
Coupon
type
Amount
(million)
CNY Equivalent Amount
(million) FX rate
XS1437622548 USD 3 Fixed 500 3347.50 6.695
XS1437622621 USD 3 Floating 750 5021.25 6.695
XS1437622977 USD 5 Fixed 1,000 6695.00 6.695
XS1437623355 EUR 5 Fixed 500 3701.40 7.4028
XS1437844100 CNY 2 Fixed 1,500 1500.00 1
Table 2 Proceeds Allocation in Terms of Category
Category Allocated amount (CNY million) Proportion
Renewable Energy 1,200 6%
Clean Transportation 18,524 92%
Sustainable water and wastewater
management 500 2%
Total 20,224 100%
Table 3 Proceeds Allocation in Terms of Location
Location Allocated amount (CNY million) Proportion
Northern China 17,714 88%
Eastern China 1,594 8%
Western China 291 1%
Overseas 626 3%
Total 20,224 100%
Green Projects Examples
As of December 31, 2017, the proceeds of Green Bond 1 had been utilized to fund 13 Eligible Green Projects. Two
projects were selected for field investigation. The details of the field investigation of the 2 projects are as follow:
Project I: A wind power generation project located in the east
of Inner Mongolia Autonomous Region of China, a
concession project with a generation capacity of 399MW. So
far, this Project has already been put into operation. It is
learnt from the on-site investigation that the total installed
capacity of this project is 399MW with the grid-connect
volume of 788,293MWh in 2017. Equivalently, the Project
could reduce CO2 emission of 0.71 million tons.
Project II: A Water treatment project located in the eastern
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China, consisting of the expansion of an Urban Sewage
Treatment Plant together with the laying of supporting pipeline
(the “Urban Sewage Treatment Project”) and the Rural Sewage
Treatment Project. So far, the Urban Sewage Treatment Plant
and Rural Sewage Project have both been completed. Based on
the on-site investigation, the treatment capacity of the Urban
Sewage Treatment Project in 2017 is 31.39 million tons. The
direct reduction of pollutants are as follows: COD : 1486.28
tons / year, NH3-N : 253.32 tons / year.
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Table 4 Environmental Impacts of the Renewable Energy Projects on a Portfolio Basis
Signed
amount4
Share of total
portfolio financing5
Eligibility for
green bonds
RE
component
Allocated
amount6
Average portfolio
lifetime
Annual
generation
Renewable energy
capacity added
Annual GHG emissions
reduced*
CNY million % % % CNY million year MWh MW tonnes of CO2 equivalent
Renewable Energy 1,199.96 68.68 100 100 1,199.96 20 943,279.86 639 818758.51
Table 5 Environmental Impacts of the Pollution Prevention and Control Projects on a Portfolio Basis
Table 6 Environmental Impacts of the Clean Transportation Projects on a Portfolio Basis
Signed amount Share of total
portfolio financing
Eligibility for
green bonds Allocated amount
Average portfolio
lifetime Annual GHG emissions reduced
CNY million % % CNY million year tonnes of CO2 equivalent***
Clean Transportation 18,524.50 12.94 100 18,524.50 20 118,887.24
4 This represents the amount legally committed by the issuer for the project or component that is eligible for green bond financing. 5 This is the share of the total project cost that is financed by the issuer. 6 This represents the amount of green bond proceeds that has been allocated to disbursements to the project. 7 Chemical Oxygen Demand 8 Ammonia Nitrogen
Signed amount Share of total
portfolio financing
Eligibility for
green bonds Allocated amount
Average portfolio
lifetime Annual pollution prevention**
CNY million % % CNY million year tonnes
Pollution prevention
and control 500.00 69.07 100 500.00 20
COD7 NH3-N 8
1,026.55 174.96
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Appendix 2
Green Bond 2
Table 1 Detailed Information of Green Bond 2
ISIN Code Currency Tenor
(year)
Coupon
type
Amount
(million)
CNY Equivalent
Amount (million) FX rate
XS1512929842 USD 3 Fixed 500 3,391.60 6.7832
Table 2 Proceeds Allocation in Terms of Category
Category Allocated amount(CNY million) Proportion
Renewable Energy 3,072 91%
Sustainable water and wastewater
management 310 9%
Total 3,381 100%
Table 3 Proceeds Allocation in Terms of Location
Location Allocated amount (CNY million) Proportion (%)
Northern China 1,715 50%
Eastern China 203 6%
Western China 1,005 30%
Central and Southern China 459 14%
Total 3,381 100%
Green Projects Examples
As of December 31, 2017, the proceeds of Green Bond 2 had been utilized to fund 12 Eligible Green Projects. One
project from each category was selected for field investigation. The details of the field investigation of the 2 projects
are as follow:
Project I: A wind power generation project located in the east
of Inner Mongolia Autonomous Region of China, a
concession project with a generation capacity of 49.5MW. So
far, this Project has already been put into operation. It is
learnt from the on-site investigation that the total installed
capacity of this project is 49.5MW with the grid-connect
volume of 99,320 MWh. Equivalently, the Project could
reduce CO2 emission of 89,457.52 tons.
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Project II: A Water treatment project located in the eastern
China, consisting of the expansion of an Urban Sewage
Treatment Plant together with the laying of supporting pipeline
(the “Urban Sewage Treatment Project”) and the Rural Sewage
Treatment Project. So far, the Urban Sewage Treatment Plant
and Rural Sewage Project have both been completed. Based on
the on-site investigation, the treatment capacity of the Urban
Sewage Treatment Project in 2017 is 38.88million tons. The
direct reduction of pollutants are as follows: COD : 1944 tons /
year, NH3-N : 369.36 tons / year.
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Table 4 Environmental Impacts of the Renewable Energy Projects on a Portfolio Basis
Signed
amount9
Share of total portfolio
financing10
Eligibility for
green bonds
RE
component
Allocated
amount11
Average portfolio
lifetime
Annual
generation
Renewable energy
capacity added
Annual GHG emissions
reduced*
CNY million % % % CNY million year MWh MW tonnes of CO2 equivalent
Renewable Energy 3071.86 36.84 100 100 3071.86 20
938,201.92 882 799,952.63
Table 5 Environmental Impacts of the Pollution Prevention and Control Projects on a Portfolio Basis
9 This represents the amount legally committed by the issuer for the project or component that is eligible for green bond financing. 10 This is the share of the total project cost that is financed by the issuer. 11 This represents the amount of green bond proceeds that has been allocated to disbursements to the project. 12 Chemical Oxygen Demand 13 Ammonia Nitrogen
Signed
amount
Share of total portfolio
financing
Eligibility for green
bonds Allocated amount
Average portfolio
lifetime Annual pollution prevention**
CNY million % % CNY million year tonnes
Pollution prevention and control 309.64 20.11 100 309.64 20 COD12 NH3-N 13
3,208.47 403.59
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Appendix 3
Green Bond 3
The use of proceeds, project evaluation and selection, management of proceeds, and reporting in relation to BoC’s
management during Green Bond 3 duration is in accordance with the Climate Bond Standard.
Table 1 Detailed Information of Green Bond 3
ISIN code Currency Tenor Coupon
type
Amount
(million)
CNY Equivalent
Amount (million) FX rate
(year)
XS1720540134 USD 5 Floating 500 3,315 6.629
XS1720540217 EUR 3 Floating 700 5,449 7.7836
XS1720540308 CNY 3 Fixed 1,000 1,000 1
Table 2 Proceeds Allocation in Terms of Category
Category Allocated amount (CNY million) Proportion
Renewable Energy 180 2%
Clean Transportation 8,776 90%
Unallocated 797 8%
Total 9,753 100%
Table 3 Proceeds Allocation in Terms of Location
Location Allocated amount (CNY million) Proportion
Northern China 7,925 81%
Southwestern China 851 9%
Overseas 180 2%
Unallocated 797 8%
Total 9,753 100%
Green Projects Examples
As of December 31, 2017, the proceeds of Green Bond 3 had been utilized to fund 13 Eligible Green Projects. One
project was selected for field investigation. The details of the field investigation of the project are as follow:
Project I:An urban rail project locates in northern China
is the main line of the city which commuting between the
northeast and southwest of the city. The total length of
the line is 29.51km with 22 stations. It is learnt from the
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on-site investigation that the annual volume of the
passenger flow is 102.17million persons, which reduces
CO2 emissions of 43,869.1 tons per year. The subway line
is expected to alleviate the heavy traffic of the city, and
to speed up the transportation of urban passengers.
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Table 4 Environmental Impacts of the Renewable Energy Projects on a Portfolio Basis
Signed
amount14
Share of total
portfolio financing15
Eligibility for
green bonds
RE
component
Allocated
amount16
Average portfolio
lifetime
Annual
generation
Renewable energy
capacity added
Annual GHG emissions
reduced*
CNY million % % % CNY million year MWh MW tonnes of CO2 equivalent
Renewable Energy 180.10 19.34 100 100 180.10 20 58,551.47 116 40,466.95
Table 5 Environmental Impacts of the Clean Transportation Projects on a Portfolio Basis
Signed amount Share of total
portfolio financing
Eligibility for
green bonds Allocated amount Average portfolio lifetime Annual GHG emissions reduced
CNY million % % CNY million year tonnes of CO2 equivalent***
Clean Transportation 8,775.78 1.55 100 8,775.78 20 26,165.80
14 This represents the amount legally committed by the issuer for the project or component that is eligible for green bond financing. 15 This is the share of the total project cost that is financed by the issuer. 16 This represents the amount of green bond proceeds that has been allocated to disbursements to the project.