BDO gets financing for green banking program

Banco de Oro Universal Bank has expanded its lending activities to include loans promoting energy efficiency and has obtained financing from the International Finance Corp. for its pioneering green banking program. Under its deal with the IFC — the World Bank’s private investment arm — the latter will provide the Henry Sy-led bank with funds that will support sustainable energy investments, with BDO serving as a conduit lender, bank President Nestor V. Tan said in a statement on Tuesday. Tan said BDO’s green banking program would also help the country manage climate change. "We are glad to have the IFC’s global expertise in sustainable energy finance complementing our deep understanding of the Philippine business environment. Together, we can promote greater use of environment-friendly energy sources," he said. The central bank is encouraging banks to engage in more socially responsible lending activities, such as those promoting a green planet. IFC resident representative Jesse Ang said the deal with BDO was "part of the IFC’s global efforts to help minimize the adverse effects of climate change, especially in developing economies [that] suffer the most from it." The Philippines accounts for only a fraction or less than 0.01 percent of global greenhouse gas emissions. Ang said the IFC was also seeking a capital increase so it can create more opportunities for the poor in developing economies, including support for climate-friendly investments in countries such as the Philippines. Tan said the country is vulnerable to climate change, as proven by twin typhoons late last year that flooded most parts of Luzon and caused property, infrastructure, and crop damage worth $4.38 billion. The typhoons directly affected 9.3 million people, according to an assessment done by the Finance department with the private sector. The central bank earlier said a number of foreign and local banks had volunteered to sign the so-called Equator Principle fostered by the IFC, which encourages banks to engage in project financing in a socially responsible manner. Under the program, bank lending practices must reflect sound environmental management practices. Banks that adhere to these green principles may earn regulatory points. — NPA, GMANews.TV