IFC green bond deepens capital marts

British banking giant Standard Chartered Bank said on Tuesday the recent issuance of around P4.8 billion ($90 million) worth of “green bond” by International Finance Corp. will deepen the domestic capital markets and benefit the economy in the long run.

IFC, a member of the World Bank Group, issued its maiden peso-denominated bond in the domestic capital markets called the “Mabuhay Bonds.” IFC is the first supranational issuer in the Philippines in over a decade.

IFC’s P4.8-billion green bond with a tenor of 15 years is the longest bond issued in the market other than government securities. They were launched and priced despite a volatile market environment, a reflection of the strong credit of IFC, a triple-A issuer rated by Moody’s and S&P.

Standard Chartered Bank acted as joint lead manager and book runner for the landmark transaction.

The proceeds of the issuance were on-lent to an eligible IFC climate project with a focus on optimizing the generation output of geothermal power plants in the country.

IFC is one of the world’s largest financiers of climate-smart projects for developing countries. IFC’s green bonds support investments in renewable energy, energy efficiency, green buildings, and other areas that reduce greenhouse gas emissions.

“For the Philippines, the deepening of domestic capital market is critical for the long-term sustainability of the economy,” Yuan Xu, IFC country manager for the Philippines, said in a statement. “The issuance of the Mabuhay bond evidences IFC’s commitment to support the country’s efforts to address climate change.” 

“… This maiden issuance may open the door for other international issuers and multilateral financial institutions to seriously consider the Philippine capital markets as one of its sources for their funding requirements and for on-lending,” Standard Chartered Bank Philippines chief executive officer Lynette Ortiz said.

IFC is a triple-A rated issuer and has issued local currency bonds in over 30 countries to help build capital markets by attracting investors who want to put their money in low-risk investments.

Topics: Standard Chartered Bank , green bond , International Finance Corp. , World Bank Group
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