SK Innovation succeeded in receiving a 500 million USD green loan from the Export-Import Bank of Korea for the investment in the second EV battery manufacturing plant in Komárom, Hungary. On May 26th, SK Innovation held a board meeting that came to approve a guarantee of obligation regarding the second EV battery plant in Hungary, known as SK Battery Manufacturing Kft.
In 2019, SK Innovation became the first South Korean company to succeed in procuring green loan funds. Every year since, SK Innovation secured green financing investments to accelerate the expansion of the eco-friendly business – EV battery.
The green loan funds, procured by SKBM from the Export-Import Bank of Korea, were obtained under large-scale and favorable financial terms in which SK Innovation would be under a guarantee of obligation. The scale of the funds is 500 million USD over a period of 7 years. These funds are to be used for the construction of the SKBM, the company’s second EV battery plant in Hungary.
Green financing is one of the many means to procure funds for green projects such as electric vehicles, renewable energy, and high-efficiency energy. With the recent rise of global interest in the environment, demand is continuing to rise, of which are the green loan, green bond, etc. Receiving green financing means the company is not only recognized for its green businesses and social duties, but also able to procure funds in favorable terms.
As the first South Korean company to procure 800 billion KRW of green loan in 2019, SK Innovation used the funds for investments in building EV battery plants in Hungary, the U.S., etc., and for battery separators. Previously, it was reported that its U.S. subsidiary SK Battery America received a 450 million USD (500 billion KRW) green loan from the States. In 2020, it further secured an additional 1 billion USD (1.1 trillion KRW) green bond, which is used in to build the EV battery facotry in Georgia. The total funds SK Innovation procured through green financing for the investment in the battery/materials business over the years amounts to approximately 3.2 trillion KRW.
SK Innovation’s CFO Kim Yang-seob said, “The recently procured Green Loan from the Export-Import Bank of Korea served as an opportunity to brand the battery business – SK Innovation’s future growth engine – as one that is environment-friendly,” and that “having secured stable funds, the investments for the second manufacturing plant in Hungary will be nothing but smooth sailing.’
In continuation of the two EV battery plants in Komárom, Hungary, SK Innovation announced in January of its investment in a third battery plant in Iváncsa, Hungary, with an annual capacity of 30GWh. The construction of the third plant in Hungary will be commenced in the third quarter this year.