The Central Bank of the Philippines’ Monetary Board approved an extension of existing regulatory incentives that allow banks to increase lending for eligible green or sustainable projects and activities. The incentives, introduced in 2023, will remain available for another two years from 06 January 2026. The measures allow banks to exceed the 25 percent Single Borrower’s Limit (SBL) by up to an additional 15 percent for eligible sustainable projects, and to lend out all funds raised from sustainable bond offerings with those funds exempt from the usual 3 percent reserve requirement (RR). The extended period is expected to support continued financing for activities such as renewable energy, water and wastewater systems, clean transportation, and climate-resilient infrastructure, aligned with the National Adaptation Plan, Nationally Determined Contributions, and the Philippine Development Plan. The central bank is also considering recalibrating risk weights for climate resilience-focused financing and exploring blended finance mechanisms with public and private partners to help de-risk projects and broaden investor participation. Before the extended incentive period ends, the central bank will conduct a comprehensive review of market conditions, utilization, and potential refinements to further scale adaptation financing.
Central Bank of the Philippines 2026-01-11
Central Bank of the Philippines extends two-year sustainable finance incentives allowing higher single-borrower exposures and reserve relief on sustainable bond proceeds
The Central Bank of the Philippines' Monetary Board has extended regulatory incentives for banks to increase lending for eligible green projects until January 2028, allowing banks to exceed the 25 percent Single Borrower’s Limit by 15 percent and exempting sustainable bond funds from the 3 percent reserve requirement. The central bank plans to review market conditions and consider recalibrating risk weights and exploring blended finance mechanisms to enhance adaptation financing.