AYALA-led Bank of the Philippine Islands (BPI) intends to raise P5 billion from its peso fixed rate bonds to help finance or refinance the business requirements of eligible Micro, Small and Medium Enterprises (MSMEs).
In a disclosure to the Philippine Stock Exchange (PSE), BPI said its “Reinforcing Inclusive Support for MSMEs Bonds,” or “Rise Bonds,” are peso fixed-rate bonds due in 2024.
These are part of the P100-billion bond program approved by its Board of Directors last May 18, 2022. The Rise Bonds is consistent with our sustainable funding framework, the lender claims.
“Support for such MSMEs is seen to be critical in the post-crisis recovery of an economy battered by high unemployment, rising inflation, and disrupted supply chains,” a BPI statement read.
The country’s third-largest lender by asset said the bonds will have a tenor of one-and-one-half years, offered at a minimum investment amount of P1 million and in additional increments of P100,000. It said the issue size has an option to upsize, subject to investor demand.
The offer period will be from January 9 to 20, 2023, and the issue and listing date will be on January 30, 2023.
BPI Capital Corp. and the Manila branch of ING Bank NV are the joint lead arrangers of the offer with the former as sole selling agent.
BPI and the joint lead arrangers reserve the right to update the offer terms and the periods and dates prescribed above, as deemed appropriate and with due notice.
Under BPI’s “Sustainable Funding Framework,” loans to MSMEs may be considered social projects eligible to be financed or refinanced by “green, social, and/or sustainability bonds,” if such loans meet any of the classifications.
These classifications include those that benefit underdeveloped region/s or whose qualifications set in the Bangko Sentral ng Pilipinas’s Manual of Regulations for Banks, and the Securities and Exchange Commission’s Guidelines on the Issuance of Social Bonds under the Asean Social Bonds Standards in the Philippines.
The classifications also include those that can otherwise be expected to support and promote underserved and under-banked segments of the population or those that benefit those negatively impacted by natural calamities, with significant consequences on the people, public health, infrastructure, assets, or the economy.
The lender said MSMEs contribute significantly to the Philippine economy. They account for 99.6 percent of businesses and 64.7 percent of total employment in the country.