BPI raises P21.5 Billion bonds issuance

Bank of the Philippine Islands (BPI) has successfully raised P21.5 billion from its issuance of the country’s first COVID-19 response bonds.

BPI’s COVID Action Response (CARE) Bonds’ subscriptions for the offering reached more than seven times the initial planned issue size of P3 billion, triggering an expedited offer period closing.

The CARE Bonds were issued and listed on Friday at the Philippine Dealing & Exchange Corp.

The bonds have a tenor of 1.75 years and an interest rate of 3.05% per annum, paid quarterly in arrear.

Proceeds of the CARE Bonds will be used by BPI to finance and refinance eligible micro, small, and medium enterprises (MSMEs), one of the sectors hardest hit by COVID-19 pandemic, under the bank’s Sustainable Funding Framework.

“We issued the CARE Bonds to address the financing needs of MSMEs, as they work to overcome the challenges brought about by COVID-19. The amount raised adds to our capability to provide financing to this very important segment of the economy,” BPI president and CEO Cezar Consing said.

The overwhelming reception of investors to the CARE Bonds highlights the potential of the social bond market, which the Securities and Exchange Commission (SEC) has put forward as a funding source for projects to address the devastating impact of the global health crisis, according to BPI.

Last month, the SEC encouraged issuers to explore the social bond market to help the country recover from the pandemic, and confirmed that the BPI CARE Bonds qualify as Social Bonds under the ASEAN Social Bonds Standards.

BPI Capital Corporation and The Hongkong and Shanghai Banking Corporation Limited are the Joint lead arrangers of the CARE Bonds.

BPI Capital is sole selling agent, while HSBC is a participating selling agent.

Source: By TED CORDERO, GMA News

Source: Peso Economics