INQUIRER FILE PHOTO
MANILA, Philippines — The percentage of net earnings to be declared and remitted by the Land Bank of the Philippines (LBP) to the National Government for calendar year 2022 was adjusted from 50% to zero percent, an Executive Order (EO) released on Saturday shows.
Pursuant to Section Five of the Republic Act (RA) No. 7656, President Ferdinand “Bongbong” Marcos Jr. signed the EO No. 43 on Wednesday to downwardly adjust LBP’s dividend rate.
“Pursuant to Section 5 of RA No. 7656, the percentage of net earnings to be declared and remitted by the LBP to the National Government for CY 2022 is adjusted from fifty percent (50%) of its annual net earnings to zero percent (0%),” section one of the EO states.
As written in the EO, the adjustment shall take effect immediately. It was also reiterated that the adjustment is only applicable to the LBP for the calendar year 2022.
RA No. 7656 requires all government-owned or controlled corporations to declare and remit a dividend of at least 50% of their annual net earnings as cash, stock or property dividends to the National Government.
Meanwhile, its section 5 declares that in the interest of national economy and general welfare, the dividend rate may be adjusted by the President of the Philippines, upon the recommendation of the Secretary of Finance.
According to the EO, LBP aims to provide credit support to the agricultural sector. This support benefits 3.6 million Filipino farmers and fisherfolks, as well as other key players in the agri-business industry.
The EO said the bank likewise promotes financial inclusion, digital transformation, and sustainable developments for Filipinos.
The adjustment is to sustain the capital position of the LBP, and maintain its compliance with the Bangko Sentral ng Pilipinas’ regulations on capital adequacy requirements, the EO noted.
The EO further said the downward adjustment will help expand the bank’s role in the economic recovery of industries heavily affected by the COVID-19 pandemic.