LBP: Farmer loans on track

We’re giving priority to agriculture but that is not to say that we will not anymore do other commercial things/activities that will enhance the profitability of the bank and therefore enhance our capability to serve more farmers

The Land Bank of the Philippines (LBP), having heeded the call of President Duterte to boost lending to farmers, said they are on track to hitting the target this year, its top executive said.

LandBank president and CEO Cecilia Borromeo said the lender remains committed to serving the farmers and that farmer loan take outs have approximated one million thus far.

“We committed to the President that we will assist and serve at least 1 million farmers this year. We’re at 98 percent already although we didn’t start at zero in August,”

Borromeo told reporters.

“I made the presentation in 5 August. At that time, I think we had about 500,000 farmers. Now we’re almost a million,” she added.

According to her, the speed in the growth of farmer borrowers is owed to the standardization of LandBank’s interest charges which helped lower borrowing costs.

“We reduced the interest rate of our direct lending programs to 5 percent... Before we had 7.5 (percent) and we have 12 (percent). It varies. Now, we standardized it at 5 percent,” she said.

“We’ve intensified our work, so we’re on track,” Borromeo added.

Also, the doubling of their lending goal from one million to two million in 2020 is on track as LandBank endeavors to lend more aggressively to farmers and fishers than the commercial sector.

According to her, President Duterte himself asked LandBank to focus more aggressively on lending to the agriculture sector rather than prioritize their commercial lending operations.

“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 to the real estate sector because we have to balance our loan portfolio,” Borromeo explained.

Also, the LBP chief said the planned acquisition of the Philippine Dealing System Holdings Corp. is still on, that management still has time to seal the deal.

“We’re still hopeful. We still have six to seven weeks,” she said.

“We’re giving priority to agriculture but that is not to say that we will not anymore do other commercial things/ activities that will enhance the profitability of the bank and therefore enhance our capability to serve more farmers,” she added.

Finance Secretary Carlos Dominguez III said LandBank has the biggest loan exposure to the agriculture sector, equal to 10 percent, making it the biggest lender compared to any other bank in the country.

LBP is the third biggest lender in the country.