RCBC ventures into green financing

MANILA, Philippines — Yuchengco-led Rizal Commercial Banking Corp. (RCBC) is venturing into green financing to bankroll eligible projects that contribute to the reduction of environmental footprint in the Philippines.

RCBC president and chief executive officer Gil Buenaventura said the bank recognizes the importance of developing environmental awareness and social responsibility through its operations and the businesses it serves.

“The bank believes that balancing non-financial factors such as environmental and social issues with financial priorities is essential to good corporate citizenship and is fundamental to risk management and the protection of its investors and shareholders,” Buenaventura said.

RCBC has established a green finance framework providing the basis for the issuances of green bonds and loans which can be denominated in peso or any other currency.

The country’s 10th largest bank in terms of assets as of end-September last year said proceeds from any green financing under the framework would be used to finance or refinance a portfolio of green eligible projects relating to renewable energy, green buildings, clean transportation, energy efficiency as well as pollution prevention and control.

RCBC said its green finance framework is the first in the Philippines to be aligned with the ASEAN Capital Markets Forum’s ASEAN Green Bond Standards 2018.

Likewise, the framework is also aligned with the International Capital Market Association’s Green Bond Principles 2018 and the Loan Market Association and Asia Pacific Loan Market Association’s Green Loan Principles 2018.

The bank has been an active proponent in the renewable energy space, having provided substantial financing support to a number of landmark projects in the Philippines and in Southeast Asia.

RCBC has mandated Dutch financial giant ING Bank NV as the sole green structuring advisor for its green finance framework.

Hans Sicat, country manager of ING Bank in the Philippines, said the financial giant is honored to support RCBC in achieving the bank’s sustainability goals.

“By having a green finance framework, RCBC is now able to integrate its sustainability ambitions into its business activities and access green financing,” Sicat said.

Sustainalytics, a leading global provider of ESG research and rating, has reviewed the framework and concluded it is credible, robust and transparent.

RCBC also raised $450 million from the issuance of senior unsecured, fixed rate notes as part of its $2 billion medium term note program last year. It raised $300 million in the international debt market in March and another $150 million in April.

The bank raised its authorized capital to P28 billion from P16 billion, paving the way for a P15-billion stock rights offering. It also issued P3.58 billion worth of long-term negotiable certificates of deposits out of its P20-billion LTNCD program.

Proceeds of the fund raising activities would be used for refinancing operations, general corporate purposes, and to participate in infrastructure deals.