The International Finance Corporation (IFC), a member of the World Bank Group, is set to invest up to $150 million in the green bond to be issued by Philippines lender China Banking Corporation (China Bank).
In a disclosure, the IFC said the investment, which will be in a form of a loan, will support China Bank in raising long term funding for its lending program to qualified green projects in the Philippines.
It will not be the first time for the IFC to invest in China Bank’s green bond offer. In October 2018, the lender also invested $150 million in China Bank’s maiden green bond offer.
At a press conference in Manila, China Bank chief financial officer Patrick D. Cheng said the amount raised from the green bond issue will be used to fund climate-smart projects.
These projects, which will include investments in renewable energy, green buildings, and water conservation projects, will increase the company’s climate portfolio to more than $200 million.
Listed on the Philippines Stock Exchange, China Bank provides a wide range of banking and financial products and services. It is the fifth-largest private commercial bank in the Philippines in terms of asset size as of December 2018. The Sy family of SM controls 39 per cent of the bank.
As of May 2019, the Bank has 621 branches and 972 ATMs across the Philippines. Investment can be made throughout the country.
The IFC said the proposed amount to be invested is estimated at $150 million via USD-denominated green bond to be issued by China Bank.
“The proceeds from the bond will be used to support the bank’s lending program for climate-smart projects including renewable energy (RE), energy efficiency (EE), and green buildings,” the IFC said.
Aside from the proposed loan, the IFC will also be providing technical knowledge on climate-smart and environmentally sustainable projects to help identify projects for refinancing and new projects to be funded by the green bond.
China Bank joins other local banks that have been moving to ramp up funding for green projects. Rizal Commercial Banking Corporation raised 15 billion pesos from a 1.5-year peso green bonds in January while Bank of the Philippine Islands established a green finance network last June to serve as basis for future fundraising activities for environmental projects.
