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Chapter

value of lending with an environmental and social benefit

Assessing the environmental and social impacts of a loan is a difficult and complex matter. mecu's Ethical Lending and Investment policy (and procedures and processes that flow from this) represents a foundation that will be built on as mecu's thinking, experience, processes and system for capturing information develop.

mecu defines ‘total value of lending with an environmental and social benefit' as lending to members and organisations where the outcome improves the environment and/or social capacity and circumstance.

Figure 7b: mecu loans with environmental and social benefit in 2008/09

Environmental
Balances $42,690,409
Number of accounts 2,420
% of portfolio 3.05%
Social
Balances $270,564,631
Number of accounts    1,058
% of portfolio 19.35%
Other
Balances $1,084,981,321
Number of accounts         38,252
% of portfolio 77.60%

Environmental and social loans have increased in both dollar terms and as a percentage of the portfolio. Environmental loans have increased primarily as a result of a few large commercial loans for environmental developments. Social loans continue to grow largely as a result of the continued success of the Premium First Home Buyer Loan. This loan offers a sharply discounted variable interest rate to assist members purchase their first home by reducing their home loan repayments.