Project Finance Exposures are Eligible for the Separate 30 Percent SBL

​Banks may apply the separate Single Borrower's Limit (SBL) for project finance exposures, including those to Water Concessionaires, subject to compliance with certain conditions. The separate SBL for project finance has been temporarily increased to 30 percent from 25 percent until 31 December 2021.

BSP Governor Benjamin E. Diokno said that "The adoption by the BSP of a separate SBL for project finance aims to mobilize private sector funding toward projects that support the country's economic recovery efforts and nation building."

To be eligible for the separate SBL for project finance, bank exposures must meet the following conditions under Section 362 of the Manual of Regulations for Banks:

1. The purpose of the obligation is to finance projects that are in line with the priority programs and projects of the Philippine National Government such as water supply, wastewater, and sanitation services;​

2. ​The terms of the obligation give the lender a substantial degree of control over the asset(s) and the income that it generates by instituting standard prudential controls to safeguard creditors' interests. This may include pledge of the borrower's shares, assignment of the borrower's assets, assignment of all revenues and cash waterfall accounts of the project, and assignment of project documents; and

3. In order to curb excessive credit risk-taking, the lending bank shall consider its total project finance exposures in managing risks and complying with its internal limits on large exposures and credit risk concentrations pursuant to existing BSP regulations.