Second-Party Opinion Download

Sustainalytics is of the opinion that the Bank of the Philippine Islands’ Sustainable Funding Framework is credible and impactful and aligns with the Sustainability Bond Guidelines 2018, Green Bond Principles, Green Loan Principles, ASEAN Green Bond Standards and ASEAN Social Bond Standards. This assessment is based on the following:

USE OF PROCEEDS

The eligible categories for the use of proceeds (i) Renewable Energy, (ii) Energy Efficiency, (iii) Sustainable Water and Wastewater Management, (iv) Pollution Prevention and Control, (v) Green Buildings, and (vi) MSME Lending, are aligned with those recognized by both the Green Bond Principles and Social Bond Principles. Sustainalytics considers that the eligible categories will lead to positive environmental and social impacts and advance UN Sustainable Development Goals 6, 7, 8, 9, 10, 11, and 12.

PROJECT EVALUATION/SELECTION

BPI’s Sustainable Development Finance Team (“SDF”) is responsible for initial project selection and evaluation for green projects. All eligible green projects are subject to approval by the SDF Head. BPI’s Business Banking Strategy and Portfolio Analytics Group is similarly responsible for initial project selection and evaluation of social projects. Approval of eligible social projects is conducted by either Business Banking Segment Head or the Strategy and Portfolio Analytics Head. BPI’s Sustainable Funding Committee convenes semi-annually to evaluate alignment with eligibility criteria. Sustainalytics considers BPI’s project selection process in line with market practice.

MANAGEMENT OF PROCEEDS

BPI established a register to track and monitor the allocation and use of proceeds for the green and social bond transactions. Pending full allocation, amounts equal to the net proceeds may be invested in cash or cash equivalents, or used to repay existing borrowings of the BPI Group. Unallocated proceeds will be managed in accordance with BPI’s internal liquidity management policies. Sustainalytics views this process as aligned with market practices.

REPORTING

BPI has committed to disclose an annual allocation report as part of BPI’s Annual Integrated Report. The allocation report will include lists of eligible green and social projects, allocated amounts, and the remaining balance of unallocated proceeds. Where relevant and feasible, BPI will disclose impact metrics on the environmental outcomes of green and social projects through KPIs tailored for each project category. Metrics will be disclosed as part of the same BPI Annual Integrated Report. Sustainalytics views BPI’s allocation reporting commitments to be in line with market practice and encourages BPI to disclose impact reporting on an annual basis.