Landbank net income up 27% in 2021
Official photo of LANDBANK
MANILA, Philippines—The state-run Land Bank of the Philippines (Landbank) grew its bottom line by 27 percent to P21.8 billion in 2021 as losses provisioning dropped by over two-fifths compared to 2020 levels.
In a statement on Sunday (Feb 13) the government financial institution (GFI) attributed the growth in its 2021 net income from P17.1 billion in 2020 to “lower cost of funds and provision for losses.”
Landbank’s end-2021 statement of income and expenses showed provision for credit and impairment losses last year amounted to P5.3 billion.
In 2020, Landbank suffered from a 7.4-percent decline in net income from P18.5 billion in 2019, which the lender had blamed on “provisioning for probable losses which is significant at P9.3 billion” at the onset of the COVID-19 pandemic.
Pre-pandemic, Landbank’s provisioning for losses was only P5.2 billion in 2019 such that the 2020 amount was “the highest provisioning we’ve ever made in the history of Landbank’s operation,” it said on its website.
Landbank exceeded its P19.7-billion net-income target for 2021.
Landbank said its total assets rose 9.5 percent to P2.59 trillion in 2021 from P2.36 trillion in 2020 as a result of an 8.4-percent increase in deposits of both government and private accounts to P2.27 trillion.
Its merger with also state-run United Coconut Planters Bank (UCPB)—taking effect on March 1–will make Landbank, as the surviving entity, the Philippines’ second largest lender in terms of assets which would total to almost P3 trillion.
As the national government injected P27.5 billion in equity last year, Landbank ended 2021 with capitalization of P207.7 billion, up 23.4 percent from 2020 levels. Capital was also boosted by higher retained earnings from annual net income, it added.
Landbank said its return-on-equity ratio last year was above-industry average at 11.6 percent, while return-on-assets inched up to 0.88 percent from 0.78 percent in 2020. Its net interest margin stood at 2.9 percent in 2021.
“Landbank’s strong financial base places the bank in a prime position to support the whole agriculture sector and other development industries,” it said.
“From January to December 2021, total Landbank loans translated to the delivery of various basic services and infrastructure facilities,” it added.
“These include the construction and improvement of 303 kilometers of farm-to-market roads, 33 hospital buildings, 1,954 hospital beds, 9 school buildings, 96 classrooms, and 18,303 households connected with potable water,” it said.
“Landbank’s robust financial performance to close 2021 is a testament to resiliency and the capacity to thrive amid another challenging year,” said bank president and CEO Cecilia Borromeo.
“We will build on this momentum as we continue to take on an expanded role and a more holistic approach in supporting key development sectors and the nation at large,” Borromeo said.
TSB
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