Landbank steps up lending to farmers

Land Bank of the Philippines has nearly doubled the number of farmers it had served in the past three months after President Duterte ordered the state-run lender to focus on the agriculture sector or face abolition.

“We committed to the President that we will assist and serve at least one million farmers this year—we’re 98 percent already as of November,” Landbank president and chief executive Cecilia C. Borromeo told reporters recently.

In August, Landbank had served almost 500,000 farmers, Borromeo noted.

To recall, the President in his State of the Nation Address (Sona) last July threatened to abolish Landbank for supposedly forgetting its mandate to help farmers.

Besides the bigger number of farmer-beneficiaries, Borromeo said Landbank also reduced the interest rate for its direct lending programs for farmers from a range of 7.5 to12 percent before to 5 percent.

Borromeo said Landbank was “on track” to serve one million farmers this year and even double it to two million next year.

While focusing on the agriculture sector, Landbank will retain commercial operations but will downsize them, Borromeo said. “Since we will be giving more resources to agriculture, we will have to say no to those that are really not contributing to the national economic agenda.”

“We’re not as aggressive anymore in the real estate sector because we have to balance our loan portfolio. We were not funding mining,” she noted.
Meanwhile, Borromeo was still optimistic that the deal to buy a 49-percent stake of bond trading platform Philippine Dealing System Holdings Corp. (PDS) would be sealed before the end of the year even as clearances from other regulatory agencies remained pending.

“We’re still hopeful. We still have six to seven weeks” before 2020 ends, Borromeo said.

Asked how Landbank will defend the acquisition of PDS shares to the President, Borromeo replied: “We’re really giving priority to agriculture, but that is not to say that we will not anymore do other commercial activities that will enhance the profitability of the bank and, therefore, enhance our capability to serve more farmers,” she said. INQ