Landbank opens P50-B lending facility for crisis-hit enterprises

STATE-run Land Bank of the Philippines announced that it has launched a P50-billion loan program for enterprises affected by calamities and other man-made crises such as wars and disputes.

In a statement issued over the weekend, Landbank said its new initiative called “Nation Serves” lending program aims to provide working capital for firms affected by disruptions. “Nation Serves” stands for “National Assistance towards Initiating Opportunities to eNtities amidst Social and Economic Reverses, which Visibly Entail Shockwaves to Businesses.”

The financing of working capital for these firms is aimed at helping businesses strengthen their operations, expand trading facilities, and stockpile supplies and inventories to mitigate the actual or impending impact posed by crises.

Landbank said its allocation for the lending program is a “proactive measure” to support energy and fuel providers, industry manufacturers of medicines, metals, electronics and armaments, as well as ship builders, among others.

“Landbank aims to bolster the resiliency of key development industries by cushioning the negative impact of economic disruptions. Through the program, we will also contribute to preventing price surges on basic commodities as we continue serving the nation,” Landbank President and CEO Cecilia C. Borromeo was quoted in the statement as saying.

Eligible borrowers also include renewable energy developers, agri-businesses, and aviation hardwares and machine manufacturers.

Under the program, customers may borrow up to 85 percent of the actual need with an interest rate based on applicable Bloomberg Valuation Reference (BVAL) rate at the time of loan availment, plus a spread of not more than 75 percent of the prescribed spread based on the borrower’s credit rating.

Earlier this month, Landbank reported a net income of P13.2 billion in the first three months of the year compared to its net income in the same three month period in 2021of P5.48 billion.

The bank attributed this to higher interest income from loans and investments, as well as one-time gains from the merger with the United Coconut Planters Bank (UCPB).

The higher net income translates to a return on equity of 14.27 percent, which is above the industry average of 9.08 percent as of end-December 2021.