BDO set to borrow P5 billion via fresh green bond offer

Banking giant BDO Unibank Inc. is preparing to raise another P5 billion in debt from a massive P365-billion bond program to partly finance its expansion.

BDO, by the Sy family’s SM Group, disclosed plans to issue peso-denominated fixed-rate Asean (Association of Southeast Asian Nations) sustainability bonds.

The lender said in a stock exchange filing the proposed offer would run from Jan. 10 to 21 next year while the issue, settlement and listing date will be on Jan. 28, 2022.

The proposed issuance has an indicative tenor of two years and a minimum investment amount of 500,000, with additional increments of P100,000 thereafter.

“The net proceeds of the issue are intended to be used to diversify the bank’s funding sources, and finance and/or refinance eligible assets as defined in the bank’s Sustainable Finance Framework,” BDO said in the filing.

This is the third issuance under its massive bond program and also the first time BDO will be issuing a peso-denominated sustainability bond to both institutional and retail investors.

BDO made its first green bond issuance in 2017, raising $150 million with the International Finance Corp. as the sole investor.

BDO previously said the pioneering bond sale “will provide an alternative source of long-term green finance in the country and contribute to the Philippines’ target of reducing carbon emissions by 70 percent by 2030.”

The Securities and Exchange Commission (SEC) earlier confirmed the qualification of the issue as an Asean Sustainability Bond, having complied with requirements under the Asean Sustainability Bond Standards and the SEC Asean Sustainability Bond circular.

Standard Chartered Bank is the sole arranger of the issuance, while BDO Unibank, Inc., BDO Private Bank Inc. and Standard Chartered Bank were tapped as selling agents. BDO Capital & Investment Corp. acted as financial advisor of the planned issuance.