BDO, World Bank tie up for $150-million green bonds

MANILA, Philippines – Henry Sy-led BDO Unibank Incorporated became the country’s first commercial bank to issue green bonds aimed at addressing climate change.

In a disclosure to the Philippine Stock Exchange on Friday, December 8, BDO said it is issuing $150 million in green bonds to expand financing for private sector investments that help address climate change.

The World Bank Group’s International Finance Corporation (IFC) is the sole investor in the issuance, marking its first green bond investment in a financial institution in East Asia and the Pacific.

The green bond investment is expected to curb 93,000 tons of carbon dioxide emissions per year by 2022 through the funding of climate-smart projects, including renewable energy, green buildings, and energy-efficient equipment.

“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,” said IFC Director for East Asia and the Pacific Vivek Pathak in a statement.

Pathak added that pioneering the green bonds would hopefully provide an alternative source of long-term green financing in the country and contribute to the Philippines’ target of reducing carbon dioxide emissions by 70% by 2030.

The bond issuance is the culmination of an advisory engagement on sustainable energy finance between the IFC and BDO that started in 2010. The Philippine bank expanded its climate-smart portfolio from zero to more than $500 million.

Globally, IFC has issued $7.25 billion in green bonds in 12 currencies as part of a global strategy to develop the green bond asset class in emerging markets. – Rappler.com