ENVIRONMENTAL AND SOCIAL POLICY THE FIELD OF EXPORT CREDIT FINANCING

In the field of export credit financing, we strive to prevent environmental pollution and to manage the rational use of natural resources. In order to ensure that the supported projects are not harmful to the environment or would cause social conflict in the life of a given community, an environmental and social risk assessment procedure has been developed. We ensure that our procedures are always implemented in accordance with the current trends and regulations, therefore those are reviewed and updated on a yearly basis. By this Hungarian Export-Import Bank Plc. (hereinafter referred to as the Bank) is able to continuously monitor and improve its impact on the environment.

In addition to the comprehensive policy decisions, it is important to reduce our environmental impact during our daily actions and to integrate the principles of sustainable development into our operations. Keeping this in mind, we encourage our employees to be environmentally conscious and responsible.

Integrating principles of environmental protection and sustainable development into our activities is not only our responsibility, but an essential step in our operations. As a result, a summary of the environmental performance of our institution was born, called the Environmental Policy of EXIM.

The Bank has set up the strategic goal to support green projects. As a result, our institution aims to provide financing, risk-sharing and insurance solutions for EXIM's direct customers and its financial partners that support the sustainable development investments and business activities of exporters and its suppliers.

Besides its green efforts, the Bank also pays attention to restrict unsustainable activities, therefore we have decided to introduce restrictions on the support of coal-related projects, which we have integrated into our environmental policy.

Restriction measures have been integrated into our policy and entered into force on the 1^st January 2021.

PRINCIPLES OF THE BANK’S ENVIRONMENTAL AND SOCIAL POLICY

• It should comply with Hungarian legal requirements, international obligations, environmental social and human rights agreements undertaken by Hungary.
• It should respect the laws and competition aspects of business secrecy, in accordance with the laws on public disclosure of environmental information.
• The operating rules and procedures should be flexibly applicable and could be further developed.
• The Bank cooperates with stakeholders in assessing environmental and social impacts and respects the sovereign rights of the purchasing country.

The Government Decrees regulating the activities of the Bank stipulate that beside the conditions of financing the Bank shall also consider the environmental and social aspects of the project according to the OECD common approaches.

• The Bank can only provide export credit guarantee according to point 2 (b) of paragraph 7 of Government Decree 435/2012 on Guarantees Assumed by the Hungarian Export-Import Bank with a State Payment Guarantee and on the Conditions and Detailed Regulations of the Replacement and Interest Costs of Foreign Currency and Interest Swap Transactions, if the transaction to be financed is not harmful for the environment as a result of the environmental screening carried out on the basis of OECD common approaches on Export Credits and Social Due Diligence.
• The interest equalisation can only be taken for export credits with the period of 2 years or more than 2 years, for export credits for refinancing and for financing purchase of receivables according to point 2 (b) of paragraph 5 of Government Decree 85/1998 on Interest Equalisation System of the Hungarian Export-Import Bank, if the transaction to be financed is not harmful for the environment as a result of the environmental screening carried out on the basis of OECD common approaches on Export Credits and Social Due Diligence.