MUFG Philippines Closes First Sustainable Trade Finance Deals to Support Renewable Energy Transition

MUFG Bank’s Manila branch has completed its first sustainable trade asset finance transactions in the Philippines, marking a new step in the bank’s regional sustainable finance strategy. The inaugural deals were executed with San Miguel Global Power and SN Aboitiz Power Magat Inc., and are aligned with MUFG’s commitment to achieve net-zero emissions by 2050.

 

Introducing Sustainable Trade Finance in the Philippine Market

 

The transactions fall under MUFG’s sustainable trade asset finance framework, which the bank introduced to the Philippine market in late 2025. Designed to embed sustainability principles into trade finance structures, the framework links credit support to projects that contribute to lower-carbon outcomes and compliance with international climate commitments.

According to MUFG, these pilot deals demonstrate how trade finance instruments can be adapted to support the country’s energy transition while maintaining robust risk management and credit assurance standards.

 

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Structuring Guarantees for Renewable Energy Delivery

 

As part of the transactions, MUFG issued standby letters of credit in favor of the Department of Energy. These guarantees support renewable energy projects awarded under the government’s Green Energy Auction program, providing financial assurance that developers will deliver projects as contracted.

MUFG said the use of standby letters of credit allows renewable energy developers to meet regulatory requirements while accessing structured financing that reflects sustainability-linked objectives.

 

Scaling Solar and Hydropower Capacity

 

San Miguel Global Power’s projects supported under the arrangement cover a combined capacity of around one gigawatt, spanning floating solar installations and hydropower assets. The financing supports the group’s broader strategy to reach net-zero emissions by 2050 through investments in renewable generation, battery energy storage, and efficiency measures.

SN Aboitiz Power Magat, meanwhile, secured support for a 50-megawatt floating solar project. The transaction represents the company’s first green trade finance deal and forms part of its wider sustainability and decarbonisation roadmap.

 

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Positioning Trade Finance as a Transition Tool

 

MUFG’s Asia-Pacific transaction banking leadership said the deals illustrate how trade finance can move beyond conventional short-term liquidity support to become a tool for enabling low-carbon infrastructure. By linking guarantees to renewable energy delivery, the bank aims to help clients meet sustainability targets while supporting national energy transition goals.

For the Philippines, where electricity demand is expected to grow alongside economic expansion, the transactions highlight how international banks can play a role in mobilising capital for renewable projects that balance energy security with environmental protection.

MUFG indicated that it plans to continue expanding sustainable trade finance offerings across the region, positioning trade instruments as a practical mechanism for advancing client-led sustainability objectives and supporting the transition to cleaner energy systems.