City Savings Bank in the Philippines Issues First Social Bond with Investment from IFC

To expand financial inclusion and support human capital development in the Philippines, the International Finance Corporation (IFC) is investing $100 million in a social bond issued by City Savings Bank, Inc. (CitySavings), the first thrift bank to issue a social bond in the country. The social bond follows ICMA’s Social Bond Principles and the ASEAN Social Bond Standard.

Proceeds from the social bond will be used for loans to women in low and lower middle-income groups and encourage them to make investments in small businesses to supplement their family’s income in addition to payments for healthcare, education and housing.

“This landmark issuance will help us expand our services to reach underserved and vulnerable segments of society, allowing us to further our mission to elevate the lives of people,” said Lorenzo T. Ocampo, Chief Executive Officer of City Savings Bank.

CitySavings, a subsidiary of Union Bank of the Philippines (UnionBank), is one of the largest thrift banks in the country which provides salary loans to public school teachers, government workers, pensioners, and many other customer segments.

“Investing in women is not only the right thing to do, it also makes good business sense. This landmark issuance will build investor confidence and channel more capital to companies in the Philippines that promote social, economic, and gender equality,” said Riccardo Puliti, IFC’s Regional Vice President for Asia and the Pacific.

IFC’s investment in CitySavings’ social bond is part of a broader approach in the Philippines to work with partners to deepen capital markets for thematic bond issuances such as social bonds, green bonds, and blue bonds.

In July 2021, IFC invested in a $150 million social bond issued by UnionBank where proceeds from the bond financed 4,000 loans to micro, small and medium-sized enterprises (MSMEs) to help them recover from the impact of the pandemic on their businesses. In November 2021, IFC partnered with Ayala Corporation to issue the first social bond in the healthcare sector in the Philippines. Proceeds of the bond were used to develop a dedicated cancer hospital and received EDGE certification, making it the first green hospital building in the country.