BPI advances end of green bond offer period to Aug. 1

Strong demand from among all types of clients prompted Ayala-led Bank of the Philippine Islands (BPI) to cut short its P5-billion sustainability bond offering by one day.

BPI on Wednesday said its 1.5-year peso-denominated debt paper—dubbed BPI Sustainable, Environmental, and Equitable Development (SEED) Bonds—would be offered only until today Thursday, Aug. 1 instead of Aug. 2.

For the shortened offer period, the BPI cited the “overwhelming” demand from institutional, high-net worth and retail clients.

READ: BPI promises 6.2% yield for fresh green bonds

“The bank expresses its gratitude to the investing public’s strong support for the offer,” the country’s fourth largest bank said in a statement.

BPI added that the listing date with the Philippine Dealing and Exchange Corp. (PDEx) is unchanged, Aug. 9.

The “green” bonds were issued at par value, with an interest rate of 6.2 percent per year. Analysts previously said it would be beneficial for investors to buy BPI’s offer, especially if the Bangko Sentral ng Pilipinas opted to cut interest rates later in the year. This would give bondholders “above-market rates,” and therefore better yields.

BPI earlier said proceeds from the offering would be used to support “new or existing eligible green and/or social projects as designed under, and consistent with, BPI’s Sustainable Funding Framework.”

Under the framework, proceeds must be exclusively used to support sustainability-related projects, such as renewable energy power plants.

READ: BPI selling ‘green’ bonds this month to raise P5B

BPI Capital Corp. and Standard Chartered Bank were tapped as the joint lead arrangers and selling agents for the offer.The latest issuance is the third tranche in BPI’s P100-billion bond program, which was approved in May 2022.

The first tranche that rang up at P20.3 billion was issued in January 2023, while the second tranche worth P5 billion was issued in October.

PDEx expects P400 billion in domestic bond listings this year amid prospects of interest rate cuts that could mean higher bond prices for issuers.

PDEx president and CEO Antonino Nakpil said this would encourage issuers to pursue bond offerings.

So far, PDEx has seen at least P177.14 billion worth of bond listings. —Meg J. Adonis