VTB Group establishes climate finance and carbon trading business

дата13.10.2021

VTB Group is launching a new business line that will focus on climate finance and carbon market operations both in Russia and internationally. Vladimir Litvak, who has over 25 years’ of experience in green financing and carbon trading markets, will head up the newly formed division.

This business line will build on VTB Group’s ability to finance major projects and expertise in commodity markets with a focus on the following areas:

  • Raising financing in Russian and international markets for Russian companies to execute ESG projects aimed at reducing emissions, providing greenhouse gas capture and storage, introducing low-carbon technologies, promoting climate change adaptation, as well as undertaking transactions in the carbon market
  • Client operations in international carbon trading markets, emissions trading systems, including risk management
  • Providing a full range of financial products to reduce carbon footprint of exports and products made by Russian companies.

Vitaly Bouzoveria, Head of VTB Credit Department:

“VTB Group has been proactive in developing our ESG financing offering, and the launch of a this new business line is another step towards expanding our presence in this important sector. We offer our clients a wide range of ESG financial instruments and services, and we are seeing growing demand from them. Carbon markets have already proven to be effective in reducing greenhouse gas emissions and channelling funding into the most efficient projects and technologies. The evolution of these markets will be a major factor in the low-carbon development of Russia, the implementation of the Paris Agreement and the achievement of the Sustainable Development Goals.

We believe that it will be impossible to achieve decarbonisation of the economy and society without a significant increase in the turnover of the global carbon markets. VTB is actively developing products and infrastructure to launch operations in the carbon markets as soon as feasible.”

Previously, VTB and the Moscow Exchange agreed to partner in the development of a carbon unit trading market by establishing the foundation for the regulatory framework and requirements for trading greenhouse gas emissions quotas, as well as green certificates aimed at the reduction of Russia’s carbon footprint.

Reference

VTB Group is consistently integrating sustainable development principles into its strategy and operations, striving to take into account the interests of all stakeholders. The bank’s development strategy for the period until 2022 already provides for responsible business conduct and taking into consideration environmental, social and governance (ESG) factors in decision-making processes. The new ESG strategy will be adopted by the end of 2021 and will include the following priority areas: responsible financing, including advising clients on improving the ESG side of their business, engaging clients in ESG projects and initiatives, investing in socially significant projects, sponsorship and philanthropy, organisational development, and building an ESG governance model, including related risk management.

VTB Group offers ESG products across all business segments, including placing green bonds, financing green industries, Russia’s first open-ended mutual funds for responsible investment, and retail eco-projects.

Vladimir Litvak’s Biography

Vladimir Litvak has over 25 years of experience in financing sustainable development projects, climate change mitigation and adaptation, transition to low-carbon development, social investment and green finance projects at the state, as well as corporate level. As one of the pioneers in carbon finance and carbon markets, Mr Litvak has been involved in the creation of several carbon funds and project management in the oil and gas, mining, power and infrastructure industries.

Prior to joining VTB Capital, Vladimir Litvak held the position of Managing Director at Weild & Co, a US investment banking company, where he developed financing for sustainable development projects and impact investment. He has also been head of green finance projects and divisions at VTB Capital, SUEK, the United Nations Development Programme, and the World Bank.