IFC invests in RCBC’s $320-M notes issue

MANILA, Philippines - The International Finance Corp. (IFC), a member of the World Bank Group, was the anchor investor in Rizal Commercial Banking Corp.’s issuance of $320 million 5.25-year senior unsecured fixed-rate notes to help raise financing for Philippine infrastructure projects.

IFC country manager for the Philippines Yuan Xu said their investment would allow RCBC to participate in funding much needed infrastructure projects in the Philippines, as well as support the bank’s efforts in increasing financial inclusion by providing access to financial services to SMEs.

 RCBC president and chief executive officer Lorenzo Tan said the continued support of IFC, through its commitment of up to $75 million, “was a key ingredient to the success of RCBC’s bond issuance, with the participation of more than 100 domestic and international investors.”

In 2014, IFC lent $30 million to RCBC to increase financing of small and medium-size enterprises, including women-led businesses, and spur job creation and help support Typhoon Yolanda-affected SMEs.

IFC is also helping RCBC design non-financial services, strategies, and products for small and medium enterprises in the Philippines.

Non-financial services are value-added services that are essential for the growth of SMEs, but are difficult for SMEs to access. Strengthening SMEs creates jobs and diversifies the economic base.

IFC recently completed a project to help develop RCBC’s Women in Business program to significantly improve the bank’s offering to women entrepreneurs.

In fact, the project won the IFC CEO Gender Award for IFC’s East Asia Pacific team.

IFC and the IFC Capitalization Fund are shareholders of RCBC and have a total ownership stake of 7.71 percent in the bank as of June 2015.

The Philippine government is ramping up infrastructure spending from 2.6 percent of the country’s gross domestic product in 2010 to a targeted five percent in 2016, recognizing the need for more and better quality infrastructure as an critical part of economic progress.

After awarding 10 large public-private partnership (PPP) contracts over the last five years, the government is now tendering the next wave of such projects, which will require massive financing over longer tenors.

IFC is the private investment arm of the World Bank Group. Working with more than 2,000 businesses worldwide, IFC uses capital, expertise, and influence, to create opportunity where it’s needed most.

“In fiscal year 2015, our long-term investments in developing countries rose to nearly $18 billion, helping the private sector play an essential role in the global effort to end extreme poverty and boost shared prosperity,” Xu said.