BANK of the Philippine Islands (BPI) raised P33.7 billion from its providing of 1.5-year Sustainable, Environmental, and Equitable Improvement (SEED) Bonds, nicely above its P5-billion aim, it mentioned on Friday.
“On behalf of BPI, I’m honored to share that our bond providing has been met with outstanding enthusiasm from our traders, leading to a remaining problem measurement of P33.7 billion. I believe that is the most important problem we’ve had, and it’s oversubscribed by greater than six instances our preliminary goal of P5 billion,” BPI Senior Vice-President, Treasurer and International Markets Head Dino R. Gasmen mentioned in a speech in the course of the bond itemizing ceremony held on the Philippine Dealing & Trade Corp. (PDEx) on Friday.
A 3rd of the difficulty’s whole traders had been institutional or non-retail, whereas the remainder got here from the excessive net-worth and retail section, Mr. Gasmen mentioned.
Demand for the bonds was sturdy as sustainability-themed investments have been gaining floor up to now years, he added.
“For instance, if I’m going to put money into a bond, I wish to put money into ESG (environmental, social, and governance) in order that I can say that I’m doing one thing on the sustainability aspect,” he mentioned.
The SEED Bonds issuance marked the third tranche of BPI’s P100-billion bond program authorized in Could 2022.
The supply marked BPI’s first foray into the sustainable bond house, it mentioned in a disclosure to the inventory trade.
The papers had been priced at 6.2% each year, payable quarterly. BPI offered the bonds from July 19 to Aug. 1, closing the supply interval in the future forward of the unique schedule amid sturdy investor demand.
Web proceeds from the SEED Bonds will likely be used to finance or refinance new or current eligible inexperienced and/or social tasks in step with its Sustainable Funding Framework, BPI beforehand mentioned.
It added that it’s going to use the providing as a possibility to advertise tasks that contribute to the United Nations’ Sustainable Improvement Objectives.
BPI Capital Corp. and Normal Chartered Financial institution had been the joint lead arrangers and promoting brokers for the bond supply.
Mr. Gasmen mentioned on Friday that the proceeds of the SEED Bonds supply will assist fund BPI’s present portfolio of inexperienced and social loans.
“The factor is, a few of them are going to mature earlier than the bond matures, so there will likely be a deficit. However our lending items are assured that they’ll be capable to discover belongings to interchange these which are maturing,” he mentioned.
“It’s essential that we discover the suitable belongings that conform with our sustainability framework. We don’t wish to be accused afterward of what they name greenwashing. That’s a very powerful factor we wish to shield as a result of it impacts your popularity as an issuer,” Mr. Gasmen added.
The financial institution’s low-cost present account, financial savings account (CASA) deposits are additionally adequate for BPI’s funding wants, he mentioned.
“We noticed that the financial institution’s CASA deposits are very steady. So, if CASA deposits develop, will probably be very troublesome for me to justify the issuance of a bond,” Mr. Gasmen mentioned. BPI officers earlier mentioned they wish to problem sustainability-themed peso bonds each quarter, though this could rely on their funding wants.
BOND LISTINGS ON TRACK TO REACH TARGET
BPI’s newest bond itemizing introduced the full quantity of issuances from 14 corporations to P266.4 billion yr to this point, PDEx President and Chief Govt Officer Antonino A. Nakpil instructed reporters on the sidelines of the ceremony on Friday.
This places the PDEx on observe to achieve its goal of P400 billion in company bond issuances this yr, he mentioned.
Buying and selling quantity on the trade reached P1.1 trillion in July, the best because the P900 billion seen in March 2013, Mr. Nakpil added.
He famous that there have been six issuances within the major market final month, three of which had been ESG-themed. Two of those got here from the Ayala group, he added.
BPI’s web revenue grew by 17.5% yr on yr to P15.3 billion within the second quarter on the again of upper revenues. — A.M.C. Sy
