The Ayala Group’s Bank of the Philippine Islands (BPI) is raising P5 billion from the bond market to support loans to small business owners.
The lender said the deal involves 1.5-year fixed-rate peso bonds that mature in 2024. The offer period will run from Jan. 9 until Jan. 20 next year while the listing date would be Jan. 30.
BPI did not include details on pricing but noted it maintains an option to increase the offer size, subject to demand from investors.
Dubbed “Rise bonds”, BPI said the offer recognizes the “significant contributions” of micro, small and medium enterprises (MSMEs) to the economy.
Thus, proceeds from the offer will be used to finance or refinance the business requirements of eligible small businesses in line with its sustainability program.
The requirements include businesses in underdeveloped regions and those that benefit communities “negatively impacted by natural calamities, with significant consequences on the people, public health, infrastructure, assets, or the economy.”
Also included were qualifications set in the Bangko Sentral ng Pilipinas’ 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.
According to BPI, the Rise bonds will be issued via its P100-billion bond program.
It would focus on MSMEs since these account for over 99 percent of businesses and nearly 65 percent of total employment in the Philippines.
“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,” BPI said in the statement.
BPI Capital Corp.and ING Bank N.V., Manila Branch were tapped as joint lead arrangers of the offer while BPI Capital will act as the sole selling agent.