The Philippines’ largest bank, BDO Unibank
Inc. (BDO), has issued its first green bond, raising $150 million to expand
financing for private sector investments that help to address climate change.
This marks the first green bond issued by a commercial bank in the Philippines.
IFC, a sister organization of the World Bank and a member of the World
Bank Group, is the sole investor in the bond.
This is also IFC’s first green bond investment in a financial institution
in East Asia and the Pacific. The pioneering green bond will provide an
alternative source of long-term green finance in the country and contribute
to the Philippines’ target of reducing carbon emissions by 70 per cent
by 2030 relative to its Business As Usual (BAU) scenario and conditioned
on international support.
The funds will be used exclusively to finance climate-smart projects including
renewable energy, green buildings, and energy-efficient equipment.
Nestor V. Tan, President & CEO of BDO, said, “Climate change is a
very real concern in the Philippines. It is one of the most vulnerable
countries globally to the impacts of such change. This bond demonstrates
our corporate commitment to come up with business solutions to address
the challenges of sustainability. This also aligns with our goal of growing
BDO’s climate business, and ultimately, fostering the nascent climate
finance market in the country. We are glad to partner with IFC, a global
expert in green finance.”
Vivek Pathak, IFC Director for East Asia and the Pacific, noted, “The
issuance is an example of BDO’s leadership in developing climate finance
in the country. By building
on our long-term partnership with BDO, we aim to create a vibrant green
bond market in the country and stimulate private sector investment in renewable
energy and energy efficiency. Further,
by setting the standard and the benchmark for green bonds issued in accordance
with the Green Bond Principles which IFC helped develop, we hope to pave
the way for other issuers and investors to access financing through this
product, at a time when demand for green infrastructure and other sustainable
investments are high.”
The financing is expected to help save 93,000 tons C02 emissions per year
The issuance is a culmination of an advisory engagement on sustainable
energy finance between IFC and BDO that started in 2010. It helped establish
sustainable energy finance as a core part of the bank’s sustainability
strategy. BDO expanded its climate-smart portfolio from zero to over $500
million, which made it the country’s market leader in climate financing.
IFC is one of the world’s largest financiers of climate-smart projects
for developing countries. Since 2005, IFC has invested $18.3 billion in
long-term financing from its own account, and mobilized another $11 billion
through partnerships with investors for climate-related projects. In all,
IFC has issued $7.25 billion in green bonds in 12 currencies. These issuances
are part of a global strategy to develop the green bond asset class in
IFC, a member of the World Bank Group, is the largest global development
institution focused on the private sector in emerging markets. Working
with more than 2,000 businesses worldwide, we use our capital, expertise,
and influence to create markets and opportunities in the toughest areas
of the world. In FY17, we delivered a record $19.3 billion in long-term
financing for developing countries, leveraging the power of the private
sector to help end poverty and boost shared prosperity. For more information,
BDO is a full-service universal bank which provides a wide range of corporate
and retail banking services. These services include traditional loan
and deposit products, as well as treasury, trust and wealth advisory, investment
banking, private banking, rural banking, cash management, leasing and finance,
remittance, credit card services and insurance and stock brokerage services.
BDO has one of the largest distribution networks, with more than 1,100
operating branches and over 3,900 ATMs nationwide. It also has a
branch in Hong Kong as well as 26 overseas remittance and representative
offices in Asia, Europe, North America and the Middle East.
BDO ranked as the largest bank in terms of total assets, loans, deposits
and trust funds under management based on published statements of condition
as of September 30, 2017. For more information, visit www.bdo.com.ph.