Loans granted by the Industrial Guarantee and Loan Fund (IGLF) to small and medium enterprises (SMEs) posted double-digit growth last year, according to state-owned Development Bank of the Philippines (DBP).
IGLF, which is managed by the DBP, released P3.27 billion in loans in 2014, up 36 percent from a year earlier.
“These loans were targeted at SMEs in the countryside seeking to fund working capital and capital expenditure requirements,” according to the DBP.
IGLF directly benefited SMEs involved in transport services, trading, agribusiness, health care, food manufacturing and construction.
“IGLF also took steps to further sharpen the focus of the program by increasing the asset size of enterprises eligible to P200 million to further increase market cover and to address financing needs of industries with high-value linkages and those with high employment generation potential,” the state-owned bank noted.
In addition, the DBP said the IGLF also ramped up its support to the Credit Surety Fund (CSF) of the central bank, assisting in 30 CSFs so that the cooperative SME members can secure loans despite the inadequacy of their collateral position.
By the end of 2014, IGLF had program contributions of P72.13 million to these CSFs, with new entrants namely: Bataan, Quezon City, Marikina, Agusan del Norte, Butuan, San Jose City, Science City, and Nueva Vizcaya.
IGLF ended 2014 with P104 million in net income.
It has also paid out almost all of its foreign obligations to the World Bank and has a remaining balance of P392.7 million with the Asian Development Bank.
DBP said the government’s investment in IGLF has grown to P6.3 billion to date from P803 million originally.