BDO Unibank Inc. has secured P115 billion from its most substantial sustainability bond issuance, marking the largest corporate debt offering in the Philippines outside government Retail Treasury Bonds.

Originally planned at P5 billion, the bond issue expanded 23-fold due to strong interest from both retail and institutional investors. The issuance was officially executed, settled, and listed on Tuesday.

This fourth ASEAN sustainability bond offering by BDO carries a 1.5-year maturity with an annual yield of 5.875 percent. The proceeds will be allocated to projects outlined in BDO’s Sustainable Finance Framework, which includes investments in renewable energy, green building initiatives, and pollution prevention, among other environmentally focused activities.

The funds will also help support BDO’s lending operations and contribute to diversifying its funding sources. ING Bank NV Manila Branch acted as the sole arranger and sustainability coordinator, with BDO and ING serving as selling agents. BDO Capital and Investment Corp. provided financial advisory services for the transaction.

This latest offering follows three previous successful issuances that raised P52.7 billion in January 2022, P63.3 billion in January 2024, and P55.7 billion in July 2024. These investments underline the growing investor appetite for sustainable finance products.

BDO reported a record net income of P40.6 billion for the first half of the year, a 3 percent increase from the same period last year, driven largely by a robust 14 percent rise in gross customer loans to P3.4 trillion. Net interest income expanded by 7 percent to P98.1 billion.

Asset quality improved as the nonperforming loan ratio fell to 1.75 percent from 2.06 percent. Nevertheless, higher expenditures on market coverage and IT investments moderated overall growth.

BDO president and CEO Nestor Tan cautioned that the bank’s expansion might slow down due to expected reductions in lending margins amid the central bank's monetary policy easing. Rate cuts typically reduce banks’ interest income on loans, affecting net interest margins and profitability.