Odette-battered rural banks may dip into P10B Landbank program
Official photo of LANDBANK
MANILA, Philippines—Struggling rural banks in six regions battered by Typhoon “Odette” late last year may seek assistance from Land Bank of the Philippines’ (Landbank) new P10-billion facility.
The lending program—called Countryside Financial Institutions’ Rehabilitation and Support to Typhoon-Odette Affected Areas (CFI-RESTORE)—will finance permanent working capital and capital expenditures.
It includes repair and rehabilitation of buildings and facilities and repair or purchase of equipment damaged or destroyed by Odette, state-run Landbank said in a statement on Sunday (July 17).
This facility “can also be used to supplement the funds of countryside financial institutions for re-lending to sub-borrowers affected by the typhoon,” Landbank said.
Landbank is targeting assistance to rural, thrift and cooperative banks in regions covered by declarations of state of calamity effective until December 2022.
These regions are Mimaropa, Western Visayas, Central Visayas, Eastern Visayas, Northern Mindanao, and Caraga.
“CFI-RESTORE will also cater to countryside financial institutions in areas placed under a state of calamity by their respective local government units (LGUs),” Landbank added.
Qualified rural lenders can borrow as much as 85 percent of their permanent capital and capital expenditure needs. For sub-borrowers’ agricultural loans, borrowers could seek up to 90-percent coverage, and 85 percent for non-agricultural loans.
“Countryside financial institutions with existing loans may also avail of loan restructuring under the program to rehabilitate and restore their operational cash flow, via extended repayment period,” Landbank said.
CFI-RESTORE will charge 4-percent interest per annum, fixed during the first three years, after which it would be subject to repricing. Landbank said working capital loans will be payable up to three years and 10 years for both capital expenditure loans and term loan rediscounting.
“In the face of unprecedented financial challenges brought about by calamities, Landbank stands ready to assist countryside financial institutions to sustain their operations,” said Cecilia Borromeo, Landbank president and CEO.
“This is part of our commitment to advance local recovery and help build more resilient communities nationwide,” Borromeo said.
TSB
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