BDT 250 Million. BDT 750 Million Climate Risk Fund - BDT 1.0 Million. BDT 2.0 Million Marketing, Training and Capacity Building

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1 1.1.1 Formulation and Board/Regional Head approval of Green Banking Policy `IDLC Finance Limited Statement on green banking as of 30/09/2017 Policy Formulation and Governance Yes No Remarks Yes An amended version of the Green Banking Policy, incorporating observations of FMO, has been approved by IDLC Board on June 23, Allocation of Fund in the Budget for Total Remarks Green Banking (In Taka) Green Finance BDT 250 BDT 250 BDT 250 BDT 750 Climate Risk Fund - BDT 1.0 BDT 1.0 BDT 2.0 Marketing, Training and Capacity Building Utilization of Funds (In Taka) Total Remarks Green Finance BDT BDT BDT BDT Climate Risk Fund BDT BDT BDT Marketing, Training and Capacity Building

2 1.1.4 Formation of Green Banking Unit Yes No Composition (Name, Designation & Department) Remarks Yes Mr. Md. Shahriar Rahman, Assistant Manager, Green Banking Desk Mr. Kazi Farhan Zahir, DGM, Head of Structured Finance, Corporate Mr. Farzana Islam Lisa, AGM, Corporate Mr. Md. Jobayer Alam, DGM, Head of Strategic Planning Mr. Rashedul Haque, AGM, Head of Products and Marketing, Consumer Mr. Adnan Rashid, AGM, Credit Risk Management(CRM) Ms. Shamima Akter, AGM, Human Resource Department Mr. Rahat Azim, Manager, IT Ms. Tabassum Abedin, Sr. Manager, Admin Mr. Mahbub-ul-Kader, AGM, ICC (Internal Credit and Compliance) Ms. Sherifa Amreen, Manager, Marketing Communications Ms. Ayesha Haque, Manager and Head of CSR Formation of Sustainable Finance Unit Mr. Asif Saad Bin Shams, Head of Credit & Collection, Unit Head Mr. Md. Mesbah Uddin Ahmed General Manager, Deputy Unit Head Mr. Md. Shahriar Rahman, Assistant Manager, Focal Point Officer Ms. Ayesha Haque, Manager, Fall-back Person Mr. Tahseen Amin Hemel, Senior Manager, Member Mr. Asif Rezwan, Manager, Member 1.2 INCORPORATION OF ENVIRONMENTAL RISK IN CORE RISK MANAGEMENT Total Remarks No of projects applicable for environmental due diligence (EDD) No of projects rated (Environmental Risk Rating sanctioned) 204 Low Moderate High Total Number (Disbursed)

3 Rated Projects Financed Total Remarks Low Moderate High Total amount disbursed (in million tk) Low , Moderate High Loan classification as of quarter end UC(standard) SMA SS DF BL No of projects 1962 tk) Initiating in house environment management No of branches and booths (Data in each quarter will reflect the cumulative figure) No of branches powered by solar energy (Data in each quarter will reflect the cumulative figure) No of booths powered by solar energy (Data in each quarter will reflect the cumulative figure) Total Remarks 34 Branches 1 Booth 34 Branches 1 Booth 34 Branches 1 Booth Branches 1 Booth Introduction of Green Office Guide or General Instruction Yes No Remarks Yes A Green Office Guideline has been approved by the Management on June 24, 2014

4 1.3.5 Pin points of Green Office Guide or General Instruction Remarks The Green Office Guideline focuses on saving electricity, water and paper, and maintenance of a clean and hygienic office environment across branches, through systematic intervention across the following areas: 1. Green Code of Conduct for IDLC Staff; 2. Green Office Premises; 3. Green Technologies; and 4. Staff Training; Inventory Details Total Remarks Consumption of Water(In Taka) Consumption of Paper(In Taka) Energy Consumption (In Taka) Electricity Gas Fuel Others (Please Specify) Total Remarks 1.4 Introducing Green Financing (In BDT) Total Remarks ETP No Amount No Amount No Amount No Amount No Amount For Installation of ETP(Amount Disbursed) Projects financed having ETP(Full amount disbursed) Bio-gas Plant Solar panel/renewable Energy Plant Solar Energy /Renewable Energy Plant 1 BDT BDT BDT BDT BDT Direct Green Indirect Green Direct Green Indirect Green

5 Bio-fertilizer Plant Hybrid Hoffman Kiln (HHK)/ (Conversion from FCK to Zigzag)/Compressed Block Fire safety Total Remarks Green Industry 2 BDT 150 Energy Efficiency 2 BDT 40.4 Green Finance at reduced rate of interest 1 BDT 60 3 BDT BDT 40.4 Direct Green Direct Green Direct Green Direct Green 1.5 Utilization of Climate Risk Fund Fund for part of CSR activities (Event) related to climate change (In million taka) Total Remarks - BDT BDT BDT IDLC supported 1000 families affected by flood in different areas including Kurigram, Gaibandha and Bogra. More than thousand families were provided with rice, pulses, jaggery, edible oil, oral saline, biscuits and medicines. Free Medical Camp was held in Sariakandi, Bogra for floodaffected victims, by IDLC this Sunday (17th September). Sadhinota Chikitshok Porishod (SHAWCHIP) & Moonlight Society actively participated alongside IDLC in the aid that benefited around 1000 people.

6 IDLC also distributed Relief Supplies to thousands of people affected by flood in different areas including Kurigram, Gaibandha and Bogra earlier this month. The health camp provided basic health checkups, Vitamins, Oral Salines and Medicine to help prevent outbreak of disease after the flood waters recede. This campaign was a part of IDLC s sustainable CSR activities that take part all across Bangladesh. IDLC donated livestock to 35 flood affected families of Haor, at Thakurbhog, Sunamgonj, in Sylhet on Friday (29th September). This initiative was jointly taken up by IDLC, Casper Foundation and Casper Foundation BRAC University to assist people who have been financially devastated by the flood- to help them restart livelihood. The arrangement was covered with a MoU with Casper Foundation to monitor the families to ensure the health of the livestock and provide training in raising them.

7 1.5.2 Fund for part of CSR activities (project) related to climate change (In million taka) - BDT BDT In this regard a letter as also submitted to BB Sustainable Finance Department 1.6 Introduction Green Marketing Introduction of Green banking Products (Please Specify) 1.7 Employee Training, Consumer Awareness and Green Event Total Remarks No of programs/trainings/seminar/ As a part of E&S Team s activities on capacity development program of IDLC workshops/awareness program Employees, the 1st session on exclusively conducted for Green Environmental & Social Risk Banking Management of IDLC employees was held on July 27, 2017 at IDLC Knowledge Center. It was a half-day session for business RMs & CRM representatives with the covered Issues like:

8 Total Remarks New ESRM 2017 Guideline of Bangladesh Bank Comparison between ERM 2011 & ESRM 2017 Frequently Ask Questions regarding ESMS Software Sector specific checklists & Corrective action plan before financing E&S team will arrange another 2 sessions by this year for building readiness of IDLC employees on E&S Risk Management which is now an integral part of credit risk assessment and sustainable business practice. (Annexure II B) No of participants covered Employees Customers To celebrate the achievements of Green Events (Please Specify) Bangladesh Partnership for Cleaner Textile Program (PaCT) led by International Finance Corporation (IFC) & embarking the 2 nd phase of the program, IFC arranged an event titled Towards Sustainable Textile dated September 30, 2017 at Grand Ballroom, Radisson Blu Dhaka Water Garden. At this event the completion of PaCT I and the beginning of PaCT II were announced to facilitate the Greener Production. As a prominent financial

9 1.8 Disclosure of green banking activities Total Remarks partner of IFC PaCT program, IDLC officials of newly formed Sustainable Finance Unit were present at the occasion. (Annexure II C) Disclosure In Status Remarks Annual Report Yes Green Banking activities have been covered in IDLC s 2016 Annual Report. Website Yes Green Banking activities are updated regularly under the section Green Banking and Sustainability in IDLC s website ( Furthermore, different news and press releases are also available in the website news section. Media Yes News of the workshops, seminars and green expo s were covered by different printing & online media as well as the social media. Preparation of Independent green banking and sustainability report Yes IDLC prepares an independent Sustainability Report following the GRI (Global Reporting Initiatives) Guidelines. We have published our Sustainability Report for the year 2017 and it contains extensive coverage on green financing. 2.1 Sector specific environment policy Formulation of sector specific Environment Policy (Under phase 2) (If yes then please give pin points in a separate sheet) Name of the sectors for which specific environment policy formulated Yes No Remarks In Process IDLC with support from FMO and FI Konsult, is implementing an ESMS (Environmental and Social Management System) across the organization. Recently, Bangladesh Bank has published a new guideline titled Guidelines on Environmental & Social Risk Management (ESRM) for Banks and Financial Institutions in Bangladesh. IDLC is currently reviewing this guideline & within the given timeline, necessary changes will be made to our credit policy with a revision of sector specific Environment Policy. Following sectors has been decided considering sector specific exposure and their environmental and social risk: Textiles, apparels and accessories, power and energy, iron and steel, building materials, cement, glass, ceramics and pipes, pharmaceuticals, food and beverage, telecommunication, transport, paper and packaging etc.

10 2.2 Green Strategic Planning Formulation of green strategic planning (If yes then please describe in a separate sheet) Yes No Remarks IDLC has already established the Sustainable Finance Unit & Sustainable Finance Committee as per Bangladesh Bank Guideline. Under this unit, strategic planning for green & CSR activities are under process. 2.3 Environment Risk Management Plan Formulation of Banks specific environmental risk management plan and guideline Yes No Remarks Yes IDLC complies with Bangladesh Bank guideline on Environmental Risk Management (ERM) for FI dated January, 2011 and the ECR standard. IDLC also complies with the UNGC and UNEP FI principles on a voluntary basis being the only listed FI in Bangladesh IDLC have been implementing Environmental and Social Management System (ESMS) from March 1, 2016 to compute scoring of risk of different sectors, under different business segment. Meanwhile, Bangladesh Bank has issued a new guideline titled Guidelines on Environmental & Social Risk Management (ESRM) for Banks and Financial Institutions in Bangladesh. IDLC is currently on the process of reviewing our existing ESMS to the proposed ESRM guideline before making necessary changes into our credit risk management framework.

11 Progess of Green Finance IDLC Finance Limited July-September 2017 Annexure-1 Total Loan Disbursement (Funded) Direct Green Finance (Disbursement) Indirect Green Finance (Disbursement) (Taka in million) Toal Green Finance (Disbursement) Direct Green Finance as % of Total Loan Disbursement 9, % Details of Green Finance Bio-gas Hydro-Power Wind- Power Setting up of Bio-gas Plant in existing Dairy & poultry Farm Integrated Cow Rearing and Setting up of Biogas Plant Organic Manure from Slurry Mid Range Bio-gas Plant Biomass based large scale Bio-gas Plant Poultry & Dairy based large scale Bio-gas Plant Hydropower (Pico, Micro & Mini) Wind Energy driven Power Plant Renewable Energy Solar Energy Solar Home System Solar Micro/Mini Grid Solar Irrigation Pumping System Solar PV Assembly Plant Solar PV Plant capable to produce 1 MW or more Power Solar Cooker assembly Plant Solar Cooker assembly Solar Water Plant Heater Assembly Plant Solar Air Heater & Cooling System Assembly Plant Solar Energy Driven Cold Storage Surface Water Purification Plant using Solar Pump

12 Substitution of Conventional Lime Kiln by Energy Efficient Kiln Substitution of Conventional lighting system, electronic material, Boiler with energy efficient alternatives on the basis of Energy Audit Energy Efficiency Energy efficient Improved Cook Stove(ICS)/ICS Renewable/Hybrid Cook Stove Assembly LED Bulb/Tube Plant Manufacturing Plant Amount (in million Auto sensor power switch assembly Plant LED Bulb/Tube Assembly Plant Waste Heat Recovery System Methane Recovery from Municipal waste & to produce Power Municipal waste to Compost Solid Waste Management Auto sensor power switch assembly Plant Hazardous waste treatment facility Amount (in million Biological Effluent Treatment Plant (ETP) Combination type (Chemical +Biological) of ETP Conversion of Chemical ETP to Combination type (Chemical+ Biological) of ETP Liquid Waste Management Waste Water Treatment Plant Sewage Water Treatment Plant Central Effluent Treatment Plant Amount (in million Alternative Energy Production of Burnable Oil from waste Tire by the Process of Pyrolysis

13 Fire Burnt Brick Setting up of Hybrid Hoffman Kiln(HHK)/Tunnel Kiln/equivalent technology in Brick manufacturing Industry Non Fire Block Brick Compressed Block- Brick Autoclaved Aerated Concrete Waste Paper Recycling Plant for production of recycled paper Plastic Waste Recycling Plant (PVC, PP, LDPE, HDPE,PS) Recyclable Baggage Manufacturing Plant Used Lead Acid Battery Recycling Plant Recycling & Recyclable Product Recyclable Poly Propylene Thread & Baggage Manufacturing Plant PET Bottle Recycling Plant Solar Battery Recycling Plant Amount (in million Green Industry Establishment of Green Industry Safety and Security of Factory Ensuring Work Environment and Security of Workers of Textile and Garments Industry Miscellaneous Vermicompost Palm Oil Plant Others

14 Annexure II A Participants on the internal stuff training on Environmental & Social Risk Management Date: Place: IDLC Knowledge Center Time: 3:00pm- 6.00pm No Name Designation Department 1 Ragib Islam Aninda Management Trainee Corporate Division 2 Nasir Uddin Babu Assistant Manager Corporate Division 3 Saima Siddiqui Assistant Manager Corporate Division 4 Asif Rezwan Manager Corporate Division 5 Mohammad Shahidullah Assistant Manager Corporate Division 6 Ahsanuzzaman Management Trainee Corporate Division 7 Ahmed Sabit Faisal Management Trainee Corporate Division 8 Sakibul Huq Senior Executive Officer Corporate Division 9 Asif Hossain Management Trainee Structured Finance Department 10 Israt Jahan Anny Assistant Manager Structured Finance Department 11 Tanvir Ebne Bashar Assistant Manager Structured Finance Department 12 Shahriar Rahman Assistant Manager Green Banking Unit 13 Forhad Hossain Probationary Officer SME-MEF 14 Md. Abdul Halim Officer SME-MEF 15 Md. Salahuddin Senior Executive Officer SME-MEF 16 Shamsul Arefin Tawfiq Assistant Manager SME-MEF 17 Tashfia Kabir Tashfia Senior Executive Officer SME-MEF 18 Md. Shariful Islam Officer Credit-SEF 19 Md. Salman Shahria Assistant Manager Credit-SEF 20 S. M. Farabi Ferdous Senior Executive Officer Credit-SEF 21 Rakib Hossain Junior Officer Credit-SEF 22 Maleeha Tarannum Assistant Manager CRM-Central 23 Tahseen Amin Hemel Manager CRM-Central

15 Annexure II B "Towards Sustainable Textile" by International Finance Corporation (IFC)

16 REFINANCING STATUS OF IDLC FINANCE LIMITED QUARTER 3, 2017 No Loan Amount & Disburse ment Date Loan Tenure Refinance Received date from Bangladesh Bank & Reference No Product Name Amount Principal Received of Outstanding Principal Loan Classificat ion Remarks 1 Loan Amount: BDT 7,000,00 0 Date of Disburse ment date: October 23, Months Refinance Received Date: February 7, 2016 Reference no: SFD/1004/1/ Ensuring Work Environ ment and Fire Safety 6,566, UC -