DBP says construction driving loans growth
THE Development Bank of the Philippines (DBP) has extended over P15 billion loans to construction firms building the state’s priority infrastructure projects, its CEO said.
DBP President and Chief Executive Officer Cecilia C. Borromeo also said last week that the state-owned bank grew its loan book by nearly 20% in June, largely on the back of infrastructure financing.
“We have a lot of customers also who are contractors who are working on some of these big projects. Under our ICONS (Infrastructure Contractors Support) program, we have approved probably more than P15 billion already since last year,” Ms. Borromeo told reporters on the sidelines of a signing ceremony held at the DBP headquarters in Makati City on Friday.
DBP rolled out the ICONS Program in July 2017 primarily to provide special credit lines for contractors tapped by the national government to carry out big-ticket projects, particularly for those identified in the 75-item “Build, Build, Build” program of the Duterte administration.
The state-run lender has since been designated as the government’s infrastructure financing bank.
In May, DBP signed a P9.5-billion loan agreement with AlloyMTD Holdings Philippines, Inc., the construction firm selected to build the National Government Administrative Center (NGAC) in Tarlac.
The credit line represents 75% of the P13-billion budget to build the disaster-resilient backup offices for various government agencies which are based in Metro Manila. The NGAC forms part of phase 1A of the New Clark City, which broke ground in January and is targeted to be completed by late 2019.
“Our portfolio grew by about 18%, almost 20% year-on-year. More than 50% of that growth came from infrastructure projects,” Ms. Borromeo added.
At the end of June, DBP net income rose 4% to P2.76 billion, with a loan book of P250.59 billion. Of the total, P82.88 billion funded infrastructure and logistics projects.
Ms. Borromeo said the bank has also extended credit for power generation and renewable energy contracts, as well as projects administered by local government units.
Also last week, DBP also signed agreements to extend a P500-million scholarship program across 14 state universities and colleges over a five-year period. Students from poor families and with good grades will be given free tuition and miscellaneous fees, as well as allowances for books, uniforms, lodging and living expenses.
Priority courses are those whose graduates will help “support President Duterte’s ‘Build, Build, Build’”including engineering and real estate management; education; hotel and restaurant management; agriculture, forestry and environmental science; and business-related courses like accountancy.