Release of state-run lenders’ assistance to pandemic-battered businesses awaits Duterte OK
The equity infusion into two state-run banks and Philippine Guarantee Corp. (PhilGuarantee) to help businesses and sectors badly hit by the COVID-19 pandemic will be released as soon as President Duterte signs the extended validity of funds set aside under the expired Bayanihan to Recover as One Act, Budget Secretary Wendel Avisado said.
In a text message on Monday, Avisado said releases to agencies as of Dec. 18 amounted to P103.3 billion, out of the P140-165.5 billion in Bayanihan 2 funds.
The three-month implementation of the Bayanihan 2 Law lapsed last Saturday, Dec. 19.“We are expecting approval of equity infusion for Land Bank of the Philippines (Landbank), Development Bank of the Philippines (DBP) and PhilGuarantee from the Office of the President, amounting to P39 billion cumulative,” Avisado said.
The Budget chief was referring to PhilGuarantee’s P5-billion credit guarantee program, which will include large firms; as well as the low-interest loans to be extended by Landbank and DBP amounting to P18.5 billion and P6 billion, respectively, to businesses and businessmen affected by the pandemic-induced recession, under the Bayanihan 2 Law. “With the expiration of the law, release will be made upon enactment of extension,” Avisado added.
The two chambers of Congress already approved the extended validity of unreleased and unspent Bayanihan 2 funds, hence the measure now only awaited President Duterte’s signature. DBM Assistant Secretary Rolando Toledo said in a separate text message on Monday that also released under Bayanihan 2 were P3.2 billion charged from regular funds under the P4.1-trillion 2020 national budget, bringing total releases to P106.5 billion.
PhilGuarantee president and chief executive Alberto Pascual said in a text message on Monday that the DBM had yet to release the funds to the state-run firm due to some technicalities. “Understand there are some issues as PhilGuarantee is a merger of two agencies, Philippine Export-Import Credit Agency (PhilEXIM) and Home Guaranty Corp. (HGC). But this is being addressed by our comptroller,” Pascual explained.
PhilGuarantee was formed through Executive Order No. 58 signed by President Duterte in 2018, which merged PhilEXIM with HGC, as well as transferred the guarantee functions, funds and programs of Small Business Corp. and the administration of Agricultural Guarantee Fund Pool and Industrial Guarantee and Loan Fund to the consolidated state guarantee finance agency.
Since March or at the onset of the pandemic, the DBM so far released a total of P499.2 billion in funds to bolster the government’s war chest to fight COVID-19, including P386.1 billion under the earlier Bayanihan to Heal as One Act plus P6.6 billion when the Bayanihan 1 Law lapsed in June and before Bayanihan 2 took effect in September. INQ
