MANILA: The Land Bank of the Philippines (LandBank) and the Development Bank of the Philippines (DBP) are well-positioned to expand their services to Filipinos due to their robust financial health, as confirmed by the Department of Finance (DOF). Both banks have demonstrated strong capital adequacy, surpassing the minimum regulatory requirements set by the Bangko Sentral ng Pilipinas (BSP).
According to Philippines News Agency, the DOF stated that, as of the end of November 2024, LandBank's capital adequacy ratio (CAR) stood at 16.42 percent, while the DBP maintained a CAR of 14.78 percent. These figures are considerably above the BSP's minimum regulatory threshold of 10 percent, underscoring the banks' financial resilience.
Finance Secretary Ralph Recto highlighted the significance of the banks' stable financial standing, noting their essential role in fostering national progress. "The solid financial footing of LANDBANK and DBP reaffirms their indispensable role in advancing the nation's progress. This allows them to continuously adhere to prudent financial management practices and effectively utilize their resources to deliver more support to Filipinos, especially in key sectors like infrastructure; agriculture; fisheries; micro, small, and medium enterprises, and many more," Recto stated.
Lynette Ortiz, president and CEO of LandBank, expressed confidence in the bank's capacity to uphold its mandate, emphasizing its strong financial health and consistent revenue growth. Ortiz stressed the bank's commitment to being a reliable partner in the government's inclusive development initiatives.
Michael de Jesus, president and CEO of DBP, assured stakeholders of the bank's financial strength and its ability to align with President Ferdinand R. Marcos, Jr.'s 10-point economic agenda. De Jesus reiterated DBP's dedication to fulfilling its mandate and addressing the needs of clients and stakeholders.
To bolster the financial capabilities of these state banks further, the DOF is advocating for amendments to their charters, which require Congressional approval. A significant aspect of these amendments involves enabling the banks to raise private capital through public share offerings. The proposed changes include an increase in authorized capital stock, facilitating a more efficient bond issuance process for LandBank, akin to the existing process for DBP.
The DOF indicated that these amendments would enhance the banks' ability to access capital efficiently, thereby reducing their dependence on national government support or dividend relief.
