Landbank loans to pandemic-battered LGUs hit P90.9B
MANILA, Philippines—The state-run Land Bank of the Philippines (Landbank) had already loaned P90.9 billion to local government units reeling from the COVID catastrophe.
In a statement on Tuesday (Nov. 16), Landbank said the loans it approved benefited at least 330 provinces, cities and municipalities so far.
They were under the Rise Up LGUs program, which has a very lengthy spelled out meaning.
The loans as of September 2021 accounted for three-fifths of P150 billion in funds allotted by Landbank for Rise Up LGUs.
When launched in July 2020, Landbank’s initial financing for Rise Up LGUs was only P10 billion, but it grew 15 times due to demand from LGUs led by local executives belonging to the Union of Local Authorities of the Philippines (Ulap), an influential group.
Loans under Rise Up LGUs carried an interest rate of 4.5 percent per annum in the first yea but interest will be subjected to yearly repricing based on Landbank’s prevailing interest rate.
The Rise Up LGUs lending program finances programs and projects intended to stimulate economic activities and create jobs for local governments to rebound from the pandemic-induced slump.
On top of its Rise Up LGUs financing scheme, Landbank said it released from January to September 2021 another P60.4 billion in loans for LGUs’ agriculture, aquaculture, healthcare, infrastructure and transportation projects.
The latest Department of Finance-Bureau of Local Government Finance (DOF-BLGF) data last week showed that 330 LGUs borrowed a combined P82.6 billion from January to October 2020, surpassing the year’s full-year total of P81 billion in loans.
The BLGF had said that LGUs have been taking advantage of low-interest loans being offered by government financial institutions (GFIs)—like Landbank—for their infrastructure projects and COVID response-related programs.
TSB
