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July 21, 2024

World Bank’s IFC to invest $100M in BDO Blue Bonds

The International Finance Corp. (IFC) is investing up to $100 million in a Blue Bond issuance by BDO Unibank Inc. led by bankero Nestor Tan to help increase access to finance for blue projects in the Philippines.

BDO chairperson Teresita Sy-Coson said the country’s largest lender welcomes IFC’s timely support for bank’s maiden Blue Bond issuance as it reinforces its commitment to sustainable finance.

The funds coming from the investment arm of the World Bank would also allow BDO to provide more support to critical areas such as water conservation, wastewater treatment, plastic recycling, sustainable tourism, fisheries, and sustainable seafood processing.

“Marking our two-decade partnership, IFC’s investment will be key to helping BDO develop a Blue Finance Framework that will allow us to fund projects that support the country’s blue economy while establishing a new asset class in the Philippine debt market,” Sy-Coson said.

BDO’s Blue Bond will be the first such issuance in the Philippines and the first for IFC in the East Asia Pacific region. It adheres to the International Capital Market Association (ICM’s) Green Bond Principle and IFC’s recently launched Blue Finance Guidelines.

IFC will also help the Sy-led bank identify projects that can be funded by the Blue Bond while building its capacity in terms of monitoring the impact of these projects.

IFC’s role is likely to further inspire confidence among other investors, promoting market competition.

Jean Marc Arbogast, IFC country manager for the Philippines, said a blue bond instrument will be key to the nation’s growth trajectory given that the coastal blue economy is critical to the country.

“By supporting the first blue bond issuance in the country, IFC continues its tradition of supporting the development of capital markets through issuances of thematic bonds and mainstreaming climate finance in the banking sector. Moving forward, a robust blue economy will help create jobs and alleviate poverty while strengthening the marine ecosystem in the Philippines,” Abrogast said.