LANDBANK extends ₱236-B agri loans in 2019

Published February 18, 2020, 12:00 AM

by manilabulletin_admin


Landbank of the Philippines’ (LANDBANK) total loans to agriculture sector in 2019 has settled at ₱236.31 billion, but only a small portion of this went to farmers and fishermen.

In a statement, LANDBANK said it was able to intensify its lending to agriculture last year, with loans reaching ₱236.31 billion, higher than the bank’s actual target of ₱231.25 billion.

Of this amount, however, only ₱44.82 billion were outstanding loans to small farmers, fishers, cooperatives, and farmers associations.
As much as ₱191.49 billion were provided to other players in the agri-business sectors.

The bank’s total loans to agriculture sector is also just 26.50 percent of its total gross loan portfolio for the year, which stood at ₱891.77 billion.

This is despite President Rodrigo Duterte’s tall order to the state-run bank last year to perform its original mandate of providing loans to the country’s top poorest sub-sectors — farming and fishing.

Nevertheless, LANDBANK said it also exceeded the number of farmers and fishers it assisted last year, registering 1.032 million or 103 percent of its yearend target of one million.

Significant increase in the number of farmers were recorded in the provinces of Maguindanao, Palawan, Ilocos Norte, Abra, and Nueva Vizcaya.

For this year, LANDBANK will target to assist an additional one million new farmers and fishers for a total of 2 million and then it hopes to increase this to 2.5 million in 2021 and 3 million in 2022.

“Last year, President Duterte directed LANDBANK to do more for agriculture. We responded to the President’s directive by intensifying assistance to the sector, particularly in providing financing interventions to improve farmers’ income and boost productivity,” LANDBANK President and CEO Cecilia C. Borromeo said.

Under Republic Act (RA) No. 10000 or the Agri-Agra Reform Credit Act, banks are required to set aside at least 15 percent of their total loanable funds for farmers and fisherfolk, and another 10 percent for agrarian reform beneficiaries (ARBs).

Finance Secretary and LandBank chairman Carlos Dominguez III said LandBank has been the only lender compliant with this provision of the Agri-Agra Law.

Of total loans LANDBANK extended to the farm sector in 2019, ₱1.25-billion worth of credit were channeled directly to farmers, while ₱43.57 billion made up loans to cooperatives and farmers’ associations, rural financial institutions and other conduits.

A total of ₱137.88 billion in loans went to small, medium and large agribusiness enterprises, while ₱53.61 billion-worth of loans went to agri-aqua related projects of local government units (LGUs) and government-owned and -controlled corporations (GOCCs).

In terms of economic activity, LandBank extended in 2019 a total of ₱18.73 billion to the crops subsector, which consists of palay, sugarcane, banana, pineapple, corn, vegetables, among others.

Livestock accounted for ₱34.14 billion of the loans to the agriculture sector, while the share of fisheries was ₱1.92 billion.

Agri-processing and trading got ₱75.08 billion, while ₱106.44 billion in loans went to projects supporting the agriculture sector, such as the construction of farm-to-market roads, public markets, warehouses, irrigation systems, cold storages facilities and slaughterhouses.

On top of complying with the Agri-Agra Law, LandBank has also been working closely with the Department of Agrarian Reform (DAR) to hasten the distribution of individual land titles to ARBs to help improve their bankability.

The LandBank is also the distribution arm for the government’s Pantawid Pamilyang Pilipino Program (4Ps), which provides conditional and unconditional cash transfers or subsidies to the country’s poorest households.

It is also in charge of releasing the fuel subsidy cards for jeepney operators and drivers under the Pantawid Pasada program, which is meant to ease the effects on them of the fuel excise tax adjustments under the Tax Reform for Acceleration and Inclusion Act (TRAIN).