STATE-RUN BANKS Land Bank of the Philippines (LANDBANK) and the Development Bank of the Philippines (DBP) received a combined P53.29 billion in capital from the National Government since 2016 or when the current administration’s term started, the Department of Finance (DoF) reported.
The DoF said in a statement on Thursday that LANDBANK received P38.79 billion in additional capital from 2016 to end-February, while the DBP got P14.5 billion.
The infusions accounted for 72% of the total paid-up capital of LANDBANK and 45% of DBP’s.
The bulk of the capital infusions were made when the state used the two banks as lending conduits for its credit financing programs amid the pandemic.
The government provided P27.5 billion to LANDBANK and P12.5 billion to DBP to provide wholesale banking services and offer low interest loans to sectors hit by the ongoing health crisis under Republic Act No. 11494 or the Bayanihan to Recover as One Act.
The DoF said the total amount released to the banks in the five years was larger compared with infusions made in all past administrations.
It noted that the first time LANDBANK received a capital infusion from the government was during the administration of President Benigno S. Aquino III, which amounted to P3.03 billion.
LANDBANK saw its net income drop by 7.57% to P17.1 billion in 2020 from P18.5 billion in 2019, the lender reported in February.
Meanwhile, DBP posted a net profit of P3.9 billion last year, down 30.4% from the 2019 level.
In a related development, LANDBANK yesterday said it extended loans worth P200 million to the Municipality of Matanao in Davao del Sur to boost the health systems of the local government unit (LGU) amid the pandemic.
LANDBANK said in a statement that it signed six term loan agreements with the municipality on March 15.
“We continue to encourage our LGUs to utilize their borrowing capacity to bolster local healthcare services and economic recovery programs,” LANDBANK President and CEO Cecilia C. Borromeo was quoted as saying.
The loans were sourced from one of the bank’s lending facilities providing assistance to LGUs to help them revive their local economy.
The Matanao LGU plans to use a portion of the proceeds to boost its healthcare services, particularly for its isolation facilities, monitoring units and temporary treatment areas for those with coronavirus disease 2019 (COVID-19).
The funds will also be used to buy more food and medical supplies for low-income and worst-hit families in the area, specially for rice and banana farmers.
Some of the money will also help rebuild the municipal hall building severely damaged by earthquakes in 2019; buy heavy equipment for its local infrastructure projects; and fund the construction of a public market building for small farmers, fishermen and businesses. — B.M. Laforga