BPI offers loan program for hog, poultry growers

MANILA, Philippines - The Bank of the Philippine Islands (BPI) is offering this year a loan program for hog and poultry raisers who want to expand their commercial farms.

The establishment of the loan facility is in compliance to the Agri-Agra Reform Credit Act of 2010 that mandates banks to allot at least 20 percent of their total loan portfolios to agribusinesses.

During the launch of the program at Clark, Pampanga yesterday, bank executives said the credit program is being launched this year as the Philippines is seen to become a major player in the livestock industry in Southeast Asia.

The local livestock and poultry industries have remained unscathed by avian influenza and foot-and-mouth disease that recently affected many countries in Asia.

The Department of Agriculture is instituting measures to strengthen the livestock industry, opening new markets and putting up additional slaughterhouses.

BPI Corporate Banking group assistant vice president Pearl Padilla said the program is focused on farm growth corridors in Central and North Luzon.

Other growth areas identified are: Cagayan de Oro, Davao and General Santos.

“The loan facility is meant for the construction of state-of the art piggeries and poultry houses,” said Padilla.

The bank can provide a maximum loan of P140 million for the expansion of hog breeding and fattening projects seen to cost around P200 million. Of the maximum loanable amount, P108 million will be a term loan payable in 10 years at an annual interest rate of seven percent. The remaining P32 million will be released as a revolving promisory note line (RPNL) for working capital.

The borrower, meanwhile, has to put in an equity of P60 million.

To qualify for the loan, the borrower must agree to source its parent stocks from Pig Improvement Inc. and  housing facilities and equipment supplier Pigpro.

For piggeries, loan applicants must have existing operations for at least three years.

Poultry contract growing and commercial broiler production expansion projects worth at least P18 million can be granted a maximum loan amount of P12 million which would be a term loan payable in six years with an annual interest rate of seven percent.

The business owner needs to invest P6 million.

To be granted the loan, investors should arrange a contract growing scheme with poultry integrators companies Bounty Fresh, Bounty Agro, and Foster Foods.

They must also source poultry house supplies from Chickpro, Belmont and Inoza.

For commercial poultry farms, an option for a P3.5 million RPNL for working capital can also be processed.

Loans can be granted within 30 days of application. Upon grant, farm owners can be provided a grace period of two years before amortization.