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As a means to raise funds in response to the Covid-19 pandemic, the Bank of the Philippine Islands (BPI) is set to issue the country’s first bond specifically targeted at eligible micro, small, and medium enterprises (MSME’s) that have been affected by the virus.
The coronavirus action response bonds or CARE bonds have been categorized as “social bonds” under the Association of South East Asian Nations (ASEAN) Social Bonds Standards in the Philippines by the Securities and Exchange Commission.
The CARE bonds will be launched as a direct response to the needs of MSME’s as the sector has been dealt some of the biggest blows by the economic affects of the virus. MSME’s in the Philippines only receive 10% of the loans extended by the Philippine Banking system, yet they are responsible for 60% of total revenues in the country, employ 63% of the labor force, and contribute 35% of the Philippine’s GDP.
BPI president and chief executive officer Cezar Consing said. “MSMEs account for a relatively small percentage of total bank borrowings but a very large percentage of total nationwide employment. Loans to MSMEs go a long way to keeping Filipinos working. To support MSMEs is to embrace the Bayanihan spirit,”
The bond will be peso-denominated, and will likely be launched “in the next few days,” said BPI chief financial officer Maria Theresa Marcial-Javier.
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