Landbank denies it ‘failed its mandate’ as merger with DBP looms

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The state agri lender says P42.3 billion of its outstanding loans have directly benefited small farmers and fishers – a defense it raised after being labeled a ‘dismal failure’ by fellow state bank DBP.

the majority of its loan portfolio. In 2021, about two-thirds – P587.3 billion – of the state bank’s loans went to the government’s other priority projects. These include micro, small, and medium enterprises; utilities; housing; logistics; education; healthcare; environment; and tourism.

This means that of about P880.4 billion in the bank’s total loans, only P38.8 billion – or 4.4% – reached small farmers, fishers, cooperatives, and farmers’ associations.Its supporters – led by Finance Secretary Benjamin Diokno – claim that merging the two banks to form the largest bank in the Philippines would make a “bigger and stronger bank to better serve the country’s development needs.”

The DBP has been particularly vocal in its opposition. In a press conference on Tuesday, May 9, DBP Chairman Dante Tinga called Landbank a “dismal failure” for supposedly not fulfilling its mandate. “It’s [entrusted] with enormous capital and yet it failed,” the chairman added. “It is a dismal failure.”“DBP should be the surviving entity because of its richer legacy, more extensive experience and expertise, and better track record in development financing. It’s more deserving to become the surviving bank,” he said.

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