Yuchengco-led Rizal Commercial Banking Corp. (RCBC) is arranging and about to complete a P20-billion renewable energy (RE) funding for 10 RE power plants in the country.
The bank did not disclose the names of these RE firms taking out the loan facility.
In a statement on Tuesday, Sept. 12, RCBC which described its sustainability program as “a leading proponent for pure renewable energy in the Philippines” confirmed that it is “finalizing a P20-billion loan facility for 10 renewable power plants.”
“As RCBC continues to drive sustainable development and promote clean energy solutions, our collaboration with major renewable energy players reinforces our commitment to supporting the transition towards a greener and more sustainable future,” according to Robert B. Ramos, RCBC’s Head of Trust and Investments group.
To date, RCBC has issued $1.4 billion or about P79.2 billion in sustainable financing instruments that “refinanced its eligible green and social assets since the implementation of its Sustainable Finance Framework.”
It said that its environmental, social and governance (ESG) factors “are used to assess the sustainability of companies and countries” and that these “three factors are seen as best embodying the three major challenges facing corporations and wider society, now encompassing climate change, human rights/poverty alleviation, and adherence to laws.”
“It is also described as a set of practices (policies, procedures, metrics, etc.) that organizations implement to limit negative impact or enhance positive impact on ESG recipients,” said the bank.
Earlier this year, RCBC assisted RE firm Alternergy Holdings Corporation, a developer of wind, solar, and run-of-river hydro power projects.
Listed Alternergy conducted an initial public offering last March 2023 and raised about P1.6 billion. RCBC acted as the lock-up escrow agent and use-of-proceeds escrow agent for this transaction.
“By facilitating transactions like those with Alternergy, RCBC contributes to the expansion of renewable energy sources and reduces dependence on fossil fuels, aligning with global efforts to combat climate change,” said RCBC.
Meanwhile, the Bangko Sentral ng Pilipinas (BSP) has stepped up its efforts and programs to encouraging the banking system to do more green lending and pursue ESG.
Last month, the BSP announced that it is now a signatory to the United Nations (UN)-supported Principles for Responsible Investment (PRI), one of the largest voluntary global network for sustainable investment.
The plan to be a PRI signatory was hatched during former BSP Governor Felipe M. Medalla’s time. When he first disclosed it, Medalla said it is important for the BSP to participate in the global stage in weaving ESG considerations in all aspects of investment practices to promote inclusive green finance.
The BSP said that being part of PRI “allows (it) to deepen its understanding of responsible investing, enhance the inclusion of ESG factors into the overall investment process and decision-making, benchmark its practices with other PRI signatories, and thereby, help achieve the BSP’s sustainability objectives.”
By signing the PRI, investors commit to integrating ESG issues into their policies, where consistent with their fiduciary responsibilities, said the BSP.
It also said that as a PRI signatory, this complements the BSP’s membership to the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) and strengthens BSP’s 11-point Sustainable Central Banking (SCB) Strategy.
The Philippines has committed to reduce its carbon emissions by 75 percent by 2030 under the UN Framework Convention on Climate Change. The BSP, with the Department of Finance, also co-chairs the Green Force which is responsible for the country’s sustainable finance roadmap.
The BSP’s 11-point SCB Strategy was launched last Dec. 22, 2022 after four years of initially announcing its own sustainability principles.
One of the objectives of the SCB is for Philippine banks and financial institutions to be mindful of the environment and the pressing issues and threats of climate change to price and financial stability.
The 11-point strategy should increase awareness and capacity building activities, and issuance of enabling regulations, said the BSP.
The BSP will also conduct various studies or preliminary insights on sustainable finance such as the “Impact of Extreme Weather Episodes on the Philippine Banking Sector using Branch-level Supervisory Data”, "Climate Change and Monetary Policy: Some Preliminary Thoughts" by the BSP, and the “Report on The Roles of ASEAN Central Banks in Managing Climate and Environment-related Risk”, a collaborative project of the ASEAN Central Banks.
In terms of BSP’s sustainability rules and regulations for all banks, it has already issued the first and second phase frameworks, while the third phase is still ongoing.