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Friday, May 27, 2005
No equity, no loan, planters told
By Erwin Ambo S. Delilan
* Eighty-five percent of the loan will be granted by LBP, provided, however, the Negros planters should establish first the 15 percent equity
* As of late, planters are proposing to apply only for a P2 to P4-billion loan in preparation for the next crop year
THE bid of Negros planters for the P12 billion loan to put up a marketing arm for sugar buying still "hangs" with the Land Bank of the Philippines (LBP) requiring them to first put up an equity.
The proposed sugar buying is supposedly one of the measures being eyed to stabilize farm gate prices of sugar in the country.
Earlier, LBP stressed it's hesitant to grant the huge amount for loan to Negros planters because most of the latter are not "credit worthy."
LBP president and chief executive officer Margarito Teves Thursday disclosed that lately he met with Negros planters' representatives Larry Bantug and Nene Trebol and discussed about the mechanics of their proposed loan.
"I told them about the credit requirements that LBP requires before granting the loan," Teves told media men of the 85-15 sharing on the transaction.
Eighty-five percent of the loan will be granted by LBP, provided, however, the Negros planters should establish first the 15 percent equity. The equity can be in the form of quedan financing, added Teves.
"The ball is in their hands. However, they need to adhere on the 'debt-equity' scheme of LBP," said Teves.
He also said that as of the latest talks, the planters are proposing to apply only for a P2 to P4-billion loan in preparation for the next crop year.
"LBP has an internal credit policy that governs the loan procedures," Teves stressed, adding that "If they will grant the planters' request without an equity it would unfair to other sectors who also apply but comply the requirements and procedures."
Teves added: "We have to consider everybody in terms of loan program. We need to come up with a win-win situation."
Teves was in Bacolod Thursday for the signing of a memorandum of agreement between the LBP and Provincial Government for Cooperative Livelihood Assistance Program for Negros (Clap-On).
He disclosed LBP's saving in the last four months of this year following the observance of austerity measures.
He said LBP saved at least P265 million from September to December 2004. "This figure is nearly double our target of P134 million," he said.
On the hand, he also said that LBP had contributed a total of P2.7 billion in corporate taxes to the national government for 2004. It also remitted about P600 million in cash dividends to the national government last year for its 2003 income of P2 billion.
LBP also hit its P2.25 billion net income in 2004 and targets another P2.5 billion in 2005.
"We've set another record for the bank by exceeding our net income targets for four years in a row," Teves added.
He attributed the increase in its 2004 net income to the 15 percent growth in gross revenues from P18.5 billion in 2003 to P21.4 billion last year coupled with prudent management of expenses and implementation of austerity measures.
This year, said Teves, "we want to raise the bar even higher by targeting P2.5 billion in net income."
LBP also maintained its strong showing in major financial indicators for 2004. In 2004, it ranked 3rd in deposits, which grew by 16 percent from P185.2 billion in 2003 to P214.9 billion in 2004.
In assets, LBP placed 4th with an eight percent increase from P266 billion to P287 billion.
While, in terms of loans and capital, the LBP ranked 5th with P133 billion and P21 billion, respectively.
(May 27, 2005 issue)
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