CHINA BANKING Corp. (China Bank) is looking to offer peso-denominated green bonds to support demand for environmental and sustainability projects.
China Bank Chief Financial Officer Patrick D. Cheng said on Wednesday that the Sy-led lender is “looking into” offering green debt papers.
“We’re looking into it, but we actually had a $150-million IFC (International Finance Corp.) green bond. That’s being used for…some of the green projects we have,” Mr. Cheng told reporters on the sidelines of China Bank’s bond listing ceremony.
In October 2018, the lender raised $150 million from its maiden green bond offer, with World Bank Group-member IFC as its sole investor.
China Bank said the amount raised will be used to fund “climate-smart projects, increasing the company’s climate portfolio to more than $200 million,” or roughly P11 billion. These include investments in renewable energy, green buildings and water conservation projects.
“There is demand for (green) projects like these. As these come in scale, another green bond would be appropriate depending of course on the size and the scale that comes before us,” Mr. Cheng said.
The bank executive added that China Bank is looking for green projects, as some of its big borrowers are involved in environmental and sustainability projects.
“Some of our big borrowers, a lot of them, especially on the energy side and maybe some on the housing side, have projects that are green in nature because these are really important for us to sustain development.”
Local banks have been moving to ramp up funding for green projects. In December 2017, IFC also subscribed to BDO Unibank, Inc.’s green bond offer to raise $150 million.
Yuchengco-led Rizal Commercial Banking Corp. likewise raised P15 billion from 1.5-year peso green bonds in January, upsized from the P5 billion planned initially.
Meanwhile, Ayala-led Bank of the Philippine Islands established a green finance network last month to serve as a basis for future fund-raising activities for environmental projects.
China Bank booked a P1.9-billion net income in the first quarter, up 24% year-on-year, driven by robust expansion of its core businesses.
Shares in China Bank closed at P27.45 each on Friday, up 30 centavos or 1.1%. — K.A.N. Vidal