BPI LOOKING TO ISSUE ESG-THEMED BONDS

The Bank of the Philippine Islands (BPI) on Tuesday said it is looking to issue an environmental, social, and governance (ESG)-themed bond later this year, which could partly be used to refinance an obligation set to mature in July.

In a press conference in Makati City, the lender said it is looking to issue ESH-themed bonds sometime this year as it cited incentives being given by the Bangko Sentral ng Pilipinas (BSP) to lenders that do so.

“We have peso bonds maturing in July and depending on market conditions, we would like to refinance that, especially given the incentives that the BSP has provided for an ESG-themed bond,” BPI treasurer Dino Gasmen told reporters.

He was referring to the 1.5-year P20.3-billion peso fixed-rate bonds dubbed as the BPI Reinforcing Inclusive Support for MSMEs Bonds (BPI RISE Bonds), with the final issue size increased to over four times the initial target of P5.0 billion due to investor demand.

Among the incentives Gasmen cited is the lower reserve requirement which, he said, would make it cheaper than time deposits, but the bank continues to monitor market conditions on when would be the best time for the issuance.

Gasmen said the bank could issue even after the P20.3-billion fixed-rate bonds mature in July, as he said this would be easy to replace given the current liquidity conditions in the country.

“We don’t mind if it’s a little later than that. We just want to be sure what tenor or what cost,” he said.

“I’m saying it’s okay if the issuance comes after the maturity because the market really is still very liquid, so we can easily pay off the bond and issue a new bond later at better market conditions,” he added.

Sought for more details, Gasmen said BPI could issue up to P50-billion worth of bonds, but the challenge would be coming up with the ESG assets.

“I think 50 billion (pesos) is possible pero (but) like I said, if we want it to be ESG-themed, we have to come up with those ESG assets pero given this market, given how liquid it is, ako, kaya ‘yung 50 eh (for me, we can do the 50),” he said.

For his part, BPI president and chief executive officer Jose Teodoro “TG” Limcaoco said the bank could issue even higher than the P20.3 billion it is looking to refinance, and the bond could be considered

“Well, if the opportunity is there to make more, we will probably take more. Given our view, of course, of where our business is going, there’s obviously, we expect a lot of demand from loans,” he said.

In the same briefing, Limcaoco said the bank is bullish for 2024, following its double-digit net income growth recorded in the first quarter.

“I think when you look at the first-quarter results and we think about what the next nine months will be, it looks like we’re fairly confident about a good strong year. Obviously, there are some risks that might be there, but we do see the BSP keeping rates,” he said.

“I guess everyone calls it ‘higher for longer,’ even higher for longer, longer now, given the fact that inflation seems to be a little stubborn,” he added, with BSP governor Eli Remolona Jr. said policy rates could be cut by the fourth of 2024 or as late as the fourth quarter of 2025.

BPI reported a P15.3-billion net income in the first three months of the year, reflecting a 25.8% increase from the previous year as total revenues climbed by 24.6% to P39.5 billion. Net interest income rose by 18.5% to P29.8 billion, while non-interest income rose by 28.1% to P9.7 billion.

Shares in BPI were last traded at P125.00 apiece, up by P4.00 or 3.31% versus Monday’s finish of P121.00.—AOL, GMA Integrated News

This article BPI looking to issue ESG-themed bonds was originally published in GMA News Online.

2024-04-23T12:00:50Z dg43tfdfdgfd