Dominguez says LandBank has sufficient funds for rural credit
MANILA, Philippines — Finance Secretary Carlos Dominguez III said Tuesday the Land Bank of the Philippines has sufficient funds to focus more on rural credit after President Rodrigo Duterte threatened to shut down the state-run lender for supposedly not extending enough loans to farmers.
In his fourth State of the Nation Address, Duterte said LandBank is “mired in so many commercial transactions” that it supposedly forgot about its mandate of helping spur countryside development by giving credit assistance to farmers.
“Go back to where you were created for and that is to help the farmers... I'm asking now Congress, if there is no viable plan for that for the farmers and it is just all commercial transactions, might as well abolish it,” the president said.
In response to the president’s warning, Dominguez said LandBank has the money to do Duterte’s order while pushing through with its acquisition of shares in the Philippine Dealing System Holdings Corp.
LandBank had reportedly said it was targeting to complete the acquisition of the fixed-income bourse operator by the end of the year.
LandBank is also working closely with the Department of Agrarian Reform in speeding up the distribution of individual land titles to agrarian reform beneficiaries as a means to improve the bankability of small farmers, Dominguez added.
Central bank data shows LandBank is the country’s third largest bank in terms of assets as of March 31 this year.
In the first quarter, the state-controlled bank’s net income stood at P4.75 billion, up 12% from P4.26 billion in the same period last year, it said in a statement. That was also 14% higher than the lender’s first-quarter income target of P4.16 billion.
LandBank’s support for its priority sector grew 12% from January to March this year, with outstanding loans to small farmers and fishers and their associations amounting to P45.3 billion.
For the first three months of the year, LandBank released P13 billion in loans to the sector, benefiting 128,496 small farmers and fishers nationwide.
Loans for agriculture and fisheries also rose by 19% to P172 billion, including agribusiness loans which grew by 29% to P114 billion.
Aside from extending loans to the agriculture sector, LandBank also performs other critical functions such as distributing cash grants to the Pantawid Pamilyang Pilipino Program households and the Pantawid Pasada fuel subsidy beneficiaries, the Finance chief said. — Ian Nicolas Cigaral
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