UnionBank strengthens climate risk strategies with adaptive financing

The bank offers loan restructuring, pop-up banking for disaster-hit communities.

UnionBank is enhancing its risk strategies to address both physical and transition climate risks, focusing on financial support for customers affected by extreme weather events and adapting its lending approach to green investments.

With the Philippines frequently impacted by typhoons, UnionBank has developed financial solutions to help affected communities recover.

“We have various products to help them temporarily manage difficult situations by providing lending, and to a certain extent, we also do the restructuring for existing customers,” said Erwin Wiriadi, Chief Risk Officer, UnionBank.

To support areas affected by typhoons, UnionBank has introduced pop-up banking services, ensuring continued financial access amid disruptions.

The Bangko Sentral ng Pilipinas (BSP) has introduced incentives, including tax holidays and increased single borrower limits, to encourage banks to finance green projects.

“BSP increased the SBL from 25% to 40%, with an additional 15% if the bank channels green-related loans,” Wiriadi said. “The reserve requirement has also been reduced from 3% to 0% for renewable energy projects.”

As part of its long-term strategy, UnionBank is transitioning to a next-generation bank model, integrating digitalization across all market segments.