Milbank LLP acted as the sole international counsel for the joint lead managers in connection with two Association of Southeast Asian Nations (“ASEAN”) green bond issuances by Bank of Philippine Islands (“BPI”), with a combined value of approximately US$405 million.
In the first issuance, Milbank advised BPI Capital Corporation, Bank of America Merrill Lynch, Citigroup, Credit Suisse, Mizuho Securities and UBS in connection with BPI’s issuance of US$300 million ASEAN green bonds, which marks the first United States dollar-denominated ASEAN green bond to be issued by a Philippine bank. The bonds were issued via a drawdown from BPI’s $2 billion medium-term note program with a coupon rate of 2.5% per annum, payable semi-annually and due in 2024. The proceeds from the bonds will be used to finance or re-finance green eligible projects as determined by BPI’s Green Finance Framework.
In the second issuance, Milbank represented UBS AG, Credit Suisse, and BPI Capital in connection with BPI’s issuance of CHF100 million (approximately US$105 million) ASEAN green bonds, which marks the first-ever public Swiss franc-denominated benchmark bond to be issued out of the Philippines. The multi-jurisdictional transaction breaks new ground in several additional ways. The bonds, which hold a zero annual coupon and will mature in 2021, represent the first negative-yielding bonds issued out of the Philippines in the international capital markets and the first rated Philippine green bond in the international market (Baa2 with stable outlook by Moody’s).
The Milbank team for both issuances was led by Hong Kong-based Global Capital Markets partner James Grandolfo and counsel Paul Pery, with associate York Wu. Alternative Investments partner James Warbey with associate Chris Burke and paralegal Max Lees also provided support from Milbank’s London office.
Mr. Grandolfo said: “We are thrilled to have played a role in the success of these groundbreaking green bond issuances, which will further enhance BPI’s ability to provide financing for environmentally friendly projects. The remarkable investor interest speaks to the growing demand from the global business community for climate and eco-friendly investment opportunities.”
Mr. Pery added: “We are pleased to have acted for BPI in two successive market-leading transactions, despite challenging market conditions. The issuances demonstrate BPI’s commitment to being a leader in sustainability financing in the region.”
Milbank has been at the forefront of green financing transactions, regularly representing clients throughout Asia on cutting-edge, first-of-their-kind green bond issuances. The firm recently advised on AC Energy’s climate bond issuance, which marked the first Climate Bonds Initiative (“CBI”) certified US dollar climate bond in Southeast Asia to be listed on the Singapore Stock Exchange. The firm also advised Indonesian geothermal energy company Star Energy on its $580 million green bond issuance to refinance debt that had funded the acquisition of two geothermal assets, the Salak and Darajat geothermal fields.