BPI selling ‘green’ bonds this month to raise P5B

Ayala-led Bank of the Philippine Islands (BPI) will issue P5 billion worth of bonds this month to fund its sustainability-related projects.

In a stock exchange filing on Thursday, BPI said the peso-denominated fixed-rate Asean Sustainable Bonds represented the third tranche of its P100-billion bond program approved in May 2022.

The bonds, which will mature in one and a half years, will be offered at a minimum amount of P500,000. Investors have the option to add investments in increments of P100,000.

The offer period will run from July 18 to Aug. 2, while listing on the Philippine Dealing and Exchange Corp. is expected on Aug. 9, BPI said. The bank did not provide indicative interest rates for the bond sale.

Under the Asean Sustainability Bond Standards, proceeds from the issuance need to be used exclusively to fund or refinance “green” and social projects that offer environmental and social benefits, such as renewable energy plants. It should not be used for projects related to “alcohol, gambling, tobacco and weaponry.”

The Zobel family-led bank in 2022 said its P100-billion bond program would help diversify its funding sources and “support, when possible, the bank’s sustainability strategy.”

The first tranche worth P20.3 billion was issued in January last year. The Ayala Group’s banking arm aimed to use the proceeds to provide financial assistance to micro, small and medium enterprises.

BPI issued the second tranche worth P5 billion last October for “general corporate purposes.”

BPI Capital Corp. and Standard Chartered Bank were tapped as joint lead arrangers and selling agents for the latest offer.

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BPI’s bottom line in the first quarter surged by 26 percent to P15.3 billion, as its merger with Gokongwei-led Robinsons Bank Corp. helped expand its loan portfolio.

Last month, the country’s fourth largest lender launched a loan program for farmers to help improve financial literacy and provide additional funds for agricultural workers.

BanKo, BPI’s microfinance arm, said its Agri NegosyoKo loan program had lower interest rates—at 2.3 percent a month versus the 6.5-percent benchmark rate of banks—to encourage their clients to borrow money to improve their livelihoods.BanKo’s 10,000 farmer clients can borrow up to P80,000 per hectare, according to BanKo president Rod Mabiasen Jr. INQ