BPI nears P1 trillion in booked ‘green’ loans

Bank of the Philippine Islands (BPI) may see P1 trillion in sustainability-linked loan issuances earlier than expected.

The Ayala group’s banking unit cited strong demand for so-called green debt, particularly for renewable energy projects.

Eric Luchangco, BPI chief financial officer (CFO), said on Thursday their sustainability loan book reached P900 billion in the first quarter.

This is equivalent to 40 percent of its total loan portfolio of P2.3 trillion. Also, it is close to its goal of breaching the P1-trillion mark by next year.

“I think there’s a good chance that we can exceed that P1 trillion … I think we’ll achieve the P1 trillion earlier than expected,” Luchangco told reporters in a press conference.

“Our goal is that at least 50 percent of our loan book should be sustainability-linked … there’s still a bit of a ways to go from that,” he said.

According to Luchangco, BPI has so far funded 485 projects related to sustainable development. Of these, 322 are in the renewable energy and energy efficiency categories.

Asked whether he sees strong demand for renewable energy funding moving forward, the CFO said there still were “good opportunities” for the sector. This is especially so since developers often borrowed a bigger amount to scale their projects.

Next month, BPI is set to list its sustainability-linked bond offer. The demand for this was larger than the P5-billion base amount, Luchangco confirmed.

He did not disclose the exact amount raised from the issuance. However, the offer period had been shortened by four days and ended on Monday.

Under BPI’s sustainability funding framework, the proceeds of the offer must only be used to support sustainability-related projects.

Strong lending buoyed the earnings of BPI in the January to March period by 9 percent to P16.6 billion. This is BPI’s highest first-quarter net income in history.

BPI president TG Limcaoco earlier said they were poised to exceed their 2024 record-high bottom line of P62 billion. They are projecting a 12- to 13-percent increase in loans this year.