RCBC funds P55 billion green, social projects

MANILA, Philippines — Yuchengco-led Rizal Commercial Banking Corp. (RCBC) has financed P55 billion worth of green and social projects as it continues to push sustainable financing.

Ma. Christina Alvarez, corporate planning head at RCBC, said sustainable financing accounts for about 10 percent of the bank’s total loan book as of end- June.

“Another initiative that is close to the heart of the bank is sustainable finance,” Alvarez said.

Of the total amount, about P38 billion was used to bankroll green projects and the other P17 billion was used to finance social projects.

Renewable energy projects got the biggest chunk of the sustainable financing portfolio, with 42 percent, followed by clean transportation with 14 percent, affordable housing with 12 percent, and energy efficiency with 11 percent.

Likewise, nine percent of the bank’s sustainable loan book went to employment generation, followed by access to essential services with five percent, socioeconomic advancement with three percent, and sustainable water management with two percent.

“RCBC is the first Philippine universal bank to issue green and sustainable financing instruments under global standards,” Alvarez said.

In all, she said RCBC has raised $1.1 billion under its sustainable finance framework.

The Yuchengco-led bank issued the first green bond from the Philippines under the ASEAN Green Bond Standards worth P15 billion in February 2019.

This was followed by the issuance of two-year first ASEAN-labeled peso-denominated bonds worth P8 billion in June and the five-year $300 million bond in September of the same year.

The country’s eighth largest lender in terms of assets raised another P17.87 billion as it returned to the domestic debt market last March through the issuance of ASEAN sustainability peso bonds.

The proceeds of the latest fund raising activity will be used to support asset growth, refinance maturing liabilities, for general funding purposes, as well as fund eligible loans defined under the bank’s Sustainable Finance Framework that has been certified by leading independent environmental, social and governance (ESG) research and rating provider Sustainalytics.

Under RCBC’s Environmental and Social Management System, all bank loans undergo a vetting process that takes into account the social and environmental impact a project may have on the environment and communities.

The Yuchengco-led bank said it continues to embed sustainable finance in its lending strategy and operations by casting a wider net as the financing instruments provided an opportunity for investors in the impact-investing space.