AYALA-LED Bank of the Philippine Islands (BPI) on Thursday said that it would be offering P5 billion worth of fixed-rate Asean sustainable bonds, with an option to upsize, later this month.

In a filing, the bank said the offering would comprise the third tranche of a P100-billion bond program approved by its board of directors on May 18, 2022.

The 1.5-year sustainable bonds maturing in February 2026 will bear an interest rate of up to 6.31 percent per annum. BPI will offer the bonds at a minimum investment size of P500,000 and in additional increments of P100,000.

"Net proceeds of the offer will be used for the financing or refinancing of new or existing eligible green and/or social projects as defined under, and consistent with, BPI's Sustainable Funding Framework," it said.

The offer period will be from July 18 to Aug. 2, 2024. The bonds are expected to be listed and issued on the Philippine Dealing and Exchange Corp. on Aug. 9, 2024.

BPI Capital Corp. and Standard Chartered Bank were tapped as the joint lead arrangers and selling agents.

BPI said that an application for confirmation of the "Asean Sustainable" label on the bonds was filed with the Securities and Exchange Commission (SEC) last June 28 but remained pending as of Thursday.

"The bonds referred to herein are securities exempt from registration under Sec. 9.1(E) of the Securities Regulation Code and will accordingly not be registered with SEC," BPI said, noting that the bonds are not instruments and are not insured by the Philippine Deposit Insurance Corporation.

In January 2023, BPI issued P20.3 billion worth of bonds to support micro, small and medium-sized enterprises, dubbed as the Reinforcing Inclusive Support for MSMEs (RISE) Bonds. The 1.5-year bonds carried a 5.75 percent interest rate per annum, payable quarterly.

In November 2023, BPI raised nearly P37 billion from the second tranche of its P100-billion bond program, bearing an interest of 6.425 percent per annum. The proceeds were to be used for general corporate purposes, including funding source diversification.

BPI shares added P1.60, or 1.37 percent, to close at P118.30 apiece on Thursday amid a 0.89 percent rise for the benchmark Philippine Stock Exchange index.