MANILA — The Bangko Sentral ng Pilipinas said on Monday it was considering the possibility of extending more regulatory incentives to banks that “embrace” sustainable finance.
Included are banks that are raising capital to address pressing global challenges, the central bank said in a statement.
BSP Governor Benjamin Diokno said using preferential rediscount rates or providing higher loan values is being explored “to enable banks to provide green loans or for sustainable investments. “.
“BSP carefully assesses these potential incentives so as not to create unintended consequences. Nevertheless, we initially proposed the inclusion of sustainable finance as a form of compliance with compulsory credit to the agricultural sector,” he said.
The expansion of regulatory incentives falls under the third phase of the sustainable financing framework, the PASB said. The first phase was released in April 2020, he said.
“Under this framework, we expect banks to gradually increase their lending allocations for green or sustainable projects as part of their strategic environmental and social objectives,” Diokno said.
The Philippines, through its Green Force inter-agency technical working group led by BSP and the Ministry of Finance, is adopting “well-coordinated policy formulation” to support sustainable finance.
RELATED VIDEO:
