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BPI plans bond issuance to help MSMEs

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BANK OF THE Philippine Islands (BPI) is eyeing to issue COVID Action Response Bonds (CARE Bonds) for financing for eligible micro-, small-, and medium-sized enterprises (MSMEs) hit by the pandemic.

In a filing with the local bourse on Thursday, BPI said the Securities and Exchange Commission confirmed the planned issuance qualifies as social bonds under the ASEAN Social Bonds Standards in the Philippines.

“In recognition of the significant contribution of MSMEs to the Philippine economy, and as a direct response to their needs as one of the sectors hardest hit by the global pandemic, proceeds from the issuance will be used to finance or refinance eligible MSMEs under the bank’s recently established Sustainable Funding Framework,” BPI said in a filing on Thursday.

Earlier this month, BPI launched its sustainable funding framework which covers projects deemed socially relevant aside from initiatives on the environment. It is an expanded version of the green finance framework it rolled out in 2019.

The planned offering will follow other programs by BPI meant to support MSMEs. These include the loan payment deferral program, the waiver of fees for online fund transfer transactions and the bank’s discussions with state-owned Philippine Guarantee Corp. to refine its loan products for qualified clients.

“MSMEs account for a relatively small percentage of total bank borrowings but a very large percentage of total nationwide employment. Loans to MSMEs go a long way to keeping Filipinos working,” BPI President and Chief Executive Officer Cezar P. Consing was quoted as saying.

BPI raised P33.9 billion from its bond issuance in March, more than six times the initial size issue of P5 billion. The papers have a tenor of one and a half years and an interest rate of 4.05% payable quarterly.

BPI’s net earnings dropped five percent to P6.39 billion in the first quarter from the P6.72 billion logged a year ago.

Its shares ended trading at P73.95 apiece on Thursday, up by 95 centavos or by 1.3% from the previous close. — L.W.T. Noble





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