The Bangko Sentral ng Pilipinas (BSP) said Monday it has extended regulatory incentives for another two years to encourage banks to increase lending for green and sustainable projects.
The Monetary Board approved the extension of measures originally released in 2023 under Bangko Sentral ng Pilipinas (BSP) Circular No. 1185.
The incentives, which were set to expire, will now remain available until Jan. 6, 2028.
Under the guidelines, banks can exceed the 25-percent Single Borrower’s Limit by an additional 15 percent for eligible sustainable projects. The rules also allow banks to lend the full amount of funds raised from sustainable bond offerings by exempting those funds from the standard 3 percent reserve requirement.
BSP Governor Eli Remolona Jr. said the bank would continue supporting the transition toward a climate-resilient economy.
By providing targeted incentives, the BSP not only channels more credit into green activities but also strengthens the capital market by fostering wider participation among issuers and investors, Remolona said.
The extension is expected to facilitate financing for renewable energy, water and wastewater systems, clean transportation and climate-resilient infrastructure.
These activities align with the National Adaptation Plan and the Philippine Development Plan.
The BSP is also considering a recalibration of risk weights for climate resilience-focused financing to ensure the prudential treatment of these exposures remains appropriate for domestic circumstances.
It is also exploring blended finance mechanisms with government agencies and private partners to de-risk projects and broaden investor participation, the BSP said.
Before the new two-year period ends, the BSP plans to conduct a comprehensive review of market conditions and utilization to determine if further refinements are needed to support long-term climate goals.
