STATE-RUN Land Bank of the Philippines (LANDBANK) is eyeing to issue sustainability or green bonds in the second semester, its top official said on Monday.
LANDBANK President and Chief Executive Officer Lynette V. Ortiz said they are planning to issue peso-denominated sustainability bonds to raise at least P10 billion.
“What we’re hoping to do is issue sustainability or green bonds that will support our growing sustainable portfolio,” Ms. Ortiz told BusinessWorld after a House of Representatives hearing.
She said the lender could issue bonds with longer tenors or do a dual-tranche offer.
“We’re hoping to go a little bit longer — hopefully a little longer than five years. Between five to 10 years, or maybe do two tranches,” Ms. Ortiz added.
“We are going through the process, and unique to LANDBANK is our approval requirements. On top of the usual, we will need to secure NEDA (National Economic and Development Authority) support and approval, and we need the Office of the President’s approval,” he said. “All of that, end to end, we’re hoping to go to market by the second half of the year.”
Meanwhile, the Development Bank of the Philippines (DBP) could also sell more peso bonds this year.
“Maybe at most, P10 billion… towards the end of the year,” DBP President and Chief Executive Officer Michael O. de Jesus told BusinessWorld on the sidelines of a House Banks Committee hearing on Monday.
DBP last week raised P11 billion via its maiden offering of dual-tenor fixed-rate notes, above its P2-billion program.
The Series 6A bonds, which have a tenor of 1.5 years, were priced at 6.0503% per annum, while the Series 6B papers, which mature in three years, carry an annual interest rate of 6.1294%. The bank said the bond issue will allow it to expand its funding sources to boost lending.
Mr. De Jesus said they want to become “selective” in their lending, adding that they expect their loan portfolio to grow by 5% this year.
Meanwhile, the state-run lender’s net income is expected to reach about P7.3 billion this year, another official said.
“We’re increasing by about 5% per year, more or less P7.3 billion to P7.35 billion this year,” DBP Senior Vice-President Catherine T. Magana also said on the sidelines of the same House hearing.
The bank’s net income declined by 8.95% year on year to P4.68 billion in the first nine months of 2024 amid lower foreign exchange gains. Ms. Magana said they expect to have ended 2024 with a net profit of about P7 billion.
For LANDBANK’s part, Ms. Ortiz said they are “making sure that LANDBANK continues to generate strong revenues and income” to sustain its growth.
LANDBANK saw its net profit drop by 21.07% to P25.14 billion as of end-September 2024 from P31.85 billion a year prior. — Kenneth Christiane L. Basilio
