Leader Energy secures $23m loan from HSBC to support solar projects in Vietnam

HSBC Bank (Vietnam) Ltd. (HSBC Vietnam) and Malaysia’s Leader Energy Holding Berhad (Leader Energy), a wholly owned subsidiary of HNG Capital, have signed a financing agreement for VND593 billion (USD23.32 million) to support the development of Leader Energy’s solar projects in Vietnam.

This is the bank’s second transaction for Leader Energy in the country, following financing for a hydropower plant in 2017, HSBC said in a statement on Monday.

According to the statement, HSBC was the sole lender on the seven-year term loan to Leader Energy.

The loan will be used to support the refinancing of Vinh Hao 6 (VH6), a newly acquired 50 megawatt (MW) solar power plant within Leader Energy.

The project, located in Binh Thuan Province, entered commercial operation in 2019, generating 100% of its electricity sales revenue to Electricity of
Vietnam (EVN) has adopted a feed-in tariff (FiT) of 9.35 cents/kilowatt-hour (kWh) under a 20-year power purchase agreement (PPA).

The project generates 83,000 megawatt-hours (MWh) of electricity, offsetting 75,131 tonnes of carbon dioxide (CO2) emissions per year.

In 2023, VH6 was fully acquired by Leader Energy.

This acquisition confirms Leader Energy’s commitment to over 500 MW of renewable energy assets in Vietnam.

The agreement also demonstrates Vietnam’s potential for renewable energy, given the country’s favourable conditions and the government’s commitment to achieving net zero emissions by 2050.

In line with its commitment made at COP26, Vietnam intends to double down on energy transformation efforts, as the sector accounts for more than half of the country’s greenhouse gas emissions.

In addition, the country’s natural resources offer the potential to attract greater investment in the growing renewable energy sector.

“The refinancing agreement, secured through HSBC Vietnam in close cooperation with HSBC Malaysia, offered more favourable terms,” said Jenny Ng, group finance director of Leader Energy.

According to her, this strategic financial decision demonstrates the company’s solid financial position, commitment to maintaining a strong financial foundation and focus on sustainable growth,

“The trust our financial partners have in us is a testament to the strength of our financial management, our underlying assets and our ability to deliver,” he says.

It also emphasises that contributing to the energy transformation is a key element of Leader Energy’s strategy to mitigate climate change and promote sustainable development.

She added that the group is expanding its renewable energy portfolio to deliver on its commitment to achieve net zero greenhouse gas emissions by 2050.

Ahmed Yeganeh, head of wholesale banking at HSBC Vietnam, said the bank had supported Leader Energy’s growth and expansion, including its transition into the renewable energy sector in multiple ASEAN countries and Taiwan.

“This agreement shows how the financial sector can play an active role in unlocking the potential of renewable energy in Vietnam, while supporting businesses’ sustainable growth ambitions,” he added.

The success of this transaction underlines HSBC’s strong ties with ASEAN, offering seamless banking services through close cooperation between HSBC Vietnam and HSBC Malaysia, the statement said.

Leader Energy, together with its subsidiaries and jointly controlled entities, is an independent energy producer, primarily engaged in the development, ownership, operation and maintenance of energy assets and projects.

The company has a diversified portfolio of energy assets and projects, and a geographic footprint spanning seven countries in Southeast Asia and Taiwan.

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