THE INTERNATIONAL Finance Corp. (IFC) will invest $250 million in a green bond to be issued by the Bank of the Philippine Islands (BPI) to help boost climate finance in the country.
IFC will be the sole subscriber of the bond, the global developmental institution said in a joint statement with BPI on Wednesday. The bond will be aligned with the International Capital Market Association’s Green Bond Principles.
This is the biggest deal the IFC has done with a Philippine financial institution, they said.
“Proceeds will be used to finance eligible green assets in the Philippines, including renewable energy, energy efficiency, green buildings, electric vehicles, and climate-smart agriculture projects, among others,” they said.
“While most of the proceeds will be used for local projects, part could also be used to invest in bonds with underlying green assets overseas. IFC has also agreed to help BPI build its capacity to assess the eligibility and impact of its climate projects,” they added.
The issuance is also aligned with IFC’s 30 by 30 Zero Program, under which it targets to help financial institutions bring their climate-related lending to 30% of their portfolios and have minimal coal exposure by 2030.
“As a bank known for its commitment to sustainable finance and climate change mitigation, we are delighted that IFC has entrusted us with this significant investment. This is our third green bond issuance, and we will draw on our successful track record to fund projects that will make a lasting difference in the communities in which we operate,” BPI President and Chief Executive Officer Jose Teodoro K. Limcaoco was quoted as saying.
“IFC is pleased to continue its impactful partnership with BPI, a longtime client and partner in promoting climate finance in the Philippines. Thematic bonds are a key pillar of our longstanding commitment to not only tackle climate change, but also to help deepen sustainable capital markets in the country,” IFC Country Manager for the Philippines Jean-Marc Arbogast said.
BPI saw its net income rise by 4.5% year on year to P13 billion in the second quarter amid higher revenues.
Its shares rose by P2.60 or 2.3% to close at P115.80 apiece on Wednesday. — AMCS