LANDBANK books higher profit

LAND BANK of the Philippines (LANDBANK) saw its bottom line rise in 2018, supported by the robust growth in its lending business.

The state-owned LANDBANK booked a P15.5-billion net income in 2018, up 10% from the P14.1 billion logged a year ago.

LANDBANK President and Chief Executive Officer Alex V. Buenaventura attributed the lender’s “exceptional” performance last year to the “significant” growth in its lending book.

“We achieved exceptional performance in 2018 with our net loan portfolio expanding significantly by 37% or more than P220 billion to reach P840 billion,” Mr. Buenaventura said in a statement over the weekend.

He added that the lender saw improved net income last year as it continued to expand support to its priority sectors, which include agriculture, cooperatives, agri-businesses,

small and medium enterprises as well as local government units.

LANDBANK also grew its deposit base to P1.66 trillion as of end-2018, up 17% from the P1.42 trillion tallied in a comparative year-ago period, as deposits from the private and government sectors increased.

On the other hand, the lender’s capital also increased by 26% to P131.62 billion from the P104.6 billion booked in 2017.

Despite logging higher net earnings in 2018, LANDBANK incurred a “significant increase” in manpower costs following the implementation of the Salary Standardization Law, which affected the lender’s income.

LANDBANK is one of the lenders — alongside Rizal Commercial Banking Corp., Metropolitan Bank & Trust Co., Bank of the Philippine Islands as well as BDO Unibank, Inc. — that are exposed to embattled South Korean shipbuilder Hanjin Heavy Industries and Construction Philippines, which filed for corporate rehabilitation last Jan. 8. This left some $412 million in outstanding loans from the banks in limbo.

However, the Bangko Sentral ng Pilipinas downplayed the effect of Hanjin’s default on the banking industry, saying the lenders’ exposure is “negligible.”

The abovementioned banks are said to be working to take control of Hanjin’s property in Zambales, with assets estimated at $1.6 billion. •