LandBank eyes P3B from sustainability bonds

THE Land Bank of the Philippines (LandBank) said on Friday it planned to raise P3 billion from its maiden offer of sustainability bonds.

In a statement, the state- run lender said it would tap and access the capital markets for the peso- denominated fixed- rate bonds, which have a two- year tenor and are due in 2024.

These will be issued in minimum denominations of P50,000 and in multiples of P10,000 thereafter.

Their interest rate is expected to be set on October 23 while the offer period is from October 26 to November 6. They would be listed on the Philippine Dealing and Exchange Corp. (PDEx) on November 17.

Standard Chartered Bank (SCB) is the sole lead arranger and bookrunner. It and LandBank are the selling agents.

“With the pandemic posing both as a pressing challenge and opportunity, it strengthens LandBank’s commitment all the more, with a sharpened focus in supporting sectors and activities for sustainable recovery,” LandBank President and Chief Executive Officer Cecilia Borromeo said in the statement.

Proceeds from the issuance would be used to finance various loan programs that support sustainable projects, such as green and social projects, as identified in the Sustainable Finance Framework, which is the lender’s blueprint for developing sustainable financing instruments.

Green projects include those that contribute to environmental objectives, such as climate change mitigation and adaptation, natural resource and biodiversity conservation, and pollution prevention and control.

Social projects are those that help address a social concern and expected to have an impact on people’s lives. These include projects for basic infrastructure, food security, essential services, affordable housing, employment generation, and food security.

The framework is aligned with the sustainable finance principles listed in the Sustainability Bond Guidelines 2018 by the International Capital Market Association and the Asean Sustainability Bond Standards 2018 by the Asean Capital Markets Forum, among others.

Asean stands for the Association of Southeast Asian Nations. It is made up of Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.