BPI AMTC launches three ESG-linked UITF products

BPI ASSET Management and Trust Corp. (BPI AMTC) launched sustainable dollar-denominated investment options available for both corporate and retail clients.

The minimum investment for the three new unit investment trust funds (UITFs) starts at $1,000 and in increments of $500 thereafter and were available starting Monday, BPI AMTC President and Chief Executive Officer Sheila Marie U. Tan said.

“We are certain that we are answering the call of a lot of our investors. In fact, it’s interesting that our individual investors are mostly younger — which gives us hope that they are also really conscious and looks to be able to give back to society,” Ms. Tan said at a media briefing on Sunday held in Zambales.

Bank of the Philippine Islands (BPI) Head of Sustainable Development Finance Jo Ann B. Eala said sustainable investments linked with ESG or environment, social, and governance principles are attractive because they are less volatile compared with other funds.

“An ESG fund will not have that [volatility] problem. Take out those high-risk things — it doesn’t invest in coal, oil, fossil fuel, So the volatility goes down and it’s favored by investors because it’s clean,” Ms. Eala said.

The new UITFs include a purely global fixed income investment scheme, a mix of global equity and fixed income, and a purely equity fund-of-funds. These UITFs are available to investors at trust fees of 0.5%, 0.75% and 1.25% per annum.

BPI AMTC partnered with global asset management industry and sustainable investing giants such as Janus Henderson Investors, Schroder Investment Management, Wellington Management, JPMorgan Asset Management, and PIMCO for the new offerings to ensure funds will be invested in companies that comply with the highest ESG standards or are directly tied to sustainability projects and other enabling initiatives.

BPI Head of Investment Solutions Allen Martin O. Dee said they are looking to grow their ESG-linked assets, noting more clients have become increasingly aware of sustainability issues and have asked for guidance to learn more about investments related to these.

He said close to P50 billion of BPI AMTC’s nearly P900 billion in assets under management (AUM) have some form of ESG compliance and the company wants to expand this.

“We are looking at Philippine assets [in the future] — obviously we are behind in these movements compared to our foreign counterparts but we will get there,” Mr. Dee said.

One benchmark they have used to ensure that they are investing in companies true to the cause of ESG is the Sustainable Finance Disclosure Regulation (SFDR), which Mr. Dee said currently has no counterpart in the Philippines. The SFDR requires asset managers to disclose their assessment of sustainability risks when investing to improve transparency, among others. 

BPI’s Ms. Eala said consciousness for sustainability has risen alongside the push for digitalization amid the pandemic.

“The level of sustainability risk preparedness — the level that we are at today — I didn’t expect it happening in at least three years’ time, it got accelerated,” she said.

The Bangko Sentral ng Pilipinas through Circular Letter No. CL-2022-011 told financial institutions to explore and consider strategies in line with the adoption of sustainable finance. Its sustainable finance framework launched in 2020 gave banks a three-year period to adopt sustainability principles in their governance frameworks, strategies, and operations.

BPI AMTC’s AUM rose by more than 3% to P881 billion as of end-September 2021 from P854 billion as of end-2020.

Its listed parent BPI’s net income rose by 11.5% to P23.88 billion in 2021 as the decline in its loan loss buffers and higher fee income offset lower interest earnings.

BPI’s shares went up by 10 centavos or 0.10% to P100 each. — Luz Wendy T. Noble