BSP eyes ‘enabling’ rules on sustainable finance
THE BANGKO SENTRAL ng Pilipinas (BSP) will stick to “enabling” rather than prescriptive rules on sustainable finance, as the regulator eyes to promote “flexible” policies covering banks.
“We learned that the best regulatory approach remains to be one that is enabling, flexible and risk-based,” BSP Deputy Governor Chuchi G. Fonacier said in a speech during a forum on Environmental, Social and Governance (ESG) Practices for Philippine Banks yesterday.
“( We are) providing guidelines rather than mandates, considering banks’ risk appetites and business models, and applying standards proportionate to the size, structure, and complexity of their operations.”
Authorities want to spur increased lending to “sustainable” initiatives and projects, or those which minimize adverse impacts on the environment.
Ms. Fonacier, who heads the BSP’s bank supervision sector, said the policy thrust also responds to “industry preference” for a more progressive rather than mandatory regime.
“At present, we believe that BSP policies and regulations already enable sustainable finance to flourish,” the BSP official added.
The BSP and the International Finance Corp. (IFC) held the joint forum to engage bank boards and senior executives explore options for increased lending for climatefriendly and socially inclusive projects.
The IFC also signed a memorandum of understanding with the Bankers Institute of the Philippines and the Mongolian Bankers Association to push sustainable finance and green banking in the