MANILA, Philippines — The LandBank (LBP) and the Development Bank of the Philippines (DBP) will not get special treatment with regard to the capitalization requirement of the Bangko Sentral ng Pilipinas (BSP).
This comes after the two state-run banks requested a temporary exemption from BSP's capital requirements following their P75-billion contribution to the Maharlika Investment Fund (MIF).
“As far as regulation is concerned, we will evaluate their request as we do for any other requests by banks, and we will carry out the usual regulations that we carry out, so they [LandBank and DBP] will not be treated in a special way,” BSP Chairman Eli Remolona said in an ambush interview on Wednesday.
This is due to the possibility of not meeting the capital adequacy ratio (CAR) requirement of the BSP after the two state-run banks chipped in the starting capital of the MIF.
Landbank is required to remit P50 billion, while DBP is obligated to remit P25 billion as a starting starting capital of the MIF.
The BSP, meanwhile, will turn over P62 billion in funds over the next two years.
In a statement from LBP, their capital adequacy ratio remained at a “healthy level” of 16.6% which is above the 10% CAR requirement of the BSP.
On October 14, LBP was exempted by President Ferdinand Marcos Jr. from giving their 2022 net earnings to the national government as mandated by the law, weeks after depositing their share in the fund.
The MIF’s implementing rules and regulations were suspended on October 12 pending further review of the law.
But Marcos stressed on Thursday that the MIF will still push through and will be operational before the end of the year.