CAO Cases

Arne Hoel, The World Bank

East Asia & the Pacific

Philippines / Rizal Commercial Banking Corporation (RCBC)-01

Complainant
Local community members (the complainants) supported by PMCJ, IDI and BIC (NGOs)
Date Filed
October 11, 2017
Concerns
Climate change, inadequate compensation, health harms, loss of livelihoods, environmental and social management system
Case Status
Open - Ombudsman
 

Synopsis

Complaint
IFC has four active investments in Rizal Commercial Banking Corporation (RCBC) – consisting of two equity investments (up to $49 million and $100 million, respectively), one loan ($30 million), and one bond (up to $75 million).

 

According to IFC, RCBC is one of the largest universal banks in the Philippines, providing a wide range of banking and other financial products and services, including commercial and retail banking, credit cards, asset management, and treasury and investment banking products and services. IFC’s investments aim at supporting RCBC’s growth in the areas of microfinance, small and medium-sized enterprises, and retail banking, as part of IFC’s strategy to support the Philippine financial markets through investments in local financial institutions that play a key role in providing access to finance to underserved sectors.

 

In October 2017, the national NGO Philippine Movement for Climate Justice (PMCJ), in collaboration with Inclusive Development International (IDI) and Bank Information Center (BIC), submitted a complaint on behalf of several communities living in the proximity of 19 active or proposed coal-fired power plants, located in different parts of the country. The complaint alleges that RCBC has provided financial support to the plants, either directly or through companies that own or operate them. The complaint raises several concerns related to the development and operation of the plants, in the form of localized environmental and social issues, such as impacts on biodiversity, health harms caused by air pollution, inadequate compensation for physical displacement, loss of livelihoods, and violation of indigenous peoples’ rights. Further, the complaint raises issues about climate change impacts on the Philippines and its residents, including the complaint signatories, as well as issues related to RCBC’s environmental and social risk management system, lack of consultation and information about the projects and their impacts, and absence of grievance mechanisms for the affected communities.

 

CAO Action

CAO found the complaint eligible for further assessment, in reference to concerns raised regarding 11 of the 19 coal-fired plants identified in the complaint. CAO is undertaking an assessment of the complaint.

 

Status

The assessment of the case is underway.

 

Note: A CAO assessment does not entail a judgment on the merits of complaints. Rather, the aim is to listen to people's concerns, understand the different perspectives, and determine what options are available to address the complaint through CAO's Dispute Resolution and Compliance functions.

 

Updated as of March 3, 2018

 

Project information

Institution
IFC
Project Name & Number
Rizal Commercial Banking Corporation (RCBC) 30235, 32853, 34115, 37489
Department
Financial Markets
Company
Rizal Commercial Banking Corporation (RCBC)
Sector
Banking
Region
East Asia & the Pacific
Country
Philippines
Environmental Category
FI
Commitment
$30m C loan; $149m equity; $75m bond

Case Tracker

Ombudsman

  • Eligible: Completed
  • Assessment Period: In Process

Compliance