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LAND Bank of the Philippines expects the demand for
credit to further rise this year driven by the increase in
agricultural and infrastructure loans.
Gilda Pico, LandBank president,
said the lender is targeting to exceed its 10-percent growth in
loans this year from P135 billion last year.
“We are very bullish [on the
demand for credit] because we are very much involved in the programs
of the government like rice production, other crops,” Pico told
reporters on the sidelines of Rural Bankers Association of the
Philippines (RBAP) inauguration of officers.
Malacañang recently ordered
government-owned and -controlled corporations (GOCCs) to allocate 5
percent of their earnings as guarantee fund under Administrative
Order 225.
This guarantee fund reached
almost P1 billion this year, which will cover loans to the
agriculture sector in case of default.
LandBank expanded its loan
portfolio by 12 percent to P135 billion from P120.9 billion year on
year.
Its total loans to these priority
sectors reached P96.6 billion, cornering a 71-percent share of its
P135-billion loan portfolio. The remaining 29 percent was channeled
to other developmental loans.
The priority sectors include the
farmers and fisher folk, micro enterprises and small and medium
enterprises, agri-business, agri-infrastructure projects of local
governments, agri-related and environment projects.
Despite her optimism, Pico said
the bank has not revised its net income growth target of 10 percent
for this year.
The lender’s profit grew 19
percent to P4.2 billion last year from P3.5 billion a year before.
The growth was due to the expansion of income from loans,
investments and foreign exchange
During the RBAP event,
Agriculture Secretary Arthur Yap asked for the support of the rural
bankers to further extend loans to the farmers to ensure sufficient
supply of rice.
He said the guarantee fund will
help to increase rice production.
The Department of Agriculture has
allocated P1 billion as rice subsidy while local government
officials have agreed to set aside P12 billion of their Internal
Revenue Allotment for the purchase of fertilizer.
Besides increase in rice
production, the guarantee fund will also help attain the
government’s plan to impose zero importation on rice by 2010.
--Maricel E. Burgonio
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