DAR supports Landbank initiatives

Department of Agrarian Reform (DAR) Secretary John R. Castriciones lauds the current efforts of the Land Bank of the Philippines (LANDBANK) under the leadership of its President and CEO, Cecilia C. Borromeo, to comply with the statutory mandate of the Bayanihan Act (RA 11469) and the various instructions of the President on the requisite social amelioration measures under the national health emergency.

As the nation confronts the challenges wrought by the COVID-19 virus, the LANDBANK Board of Directors passed a resolution on March 31 imposing a one year moratorium on the amortization payment of agrarian reform beneficiaries (ARBs). The LANDBANK resolution was passed to assist the ARBs amidst the economic difficulties as a result of the enhanced community quarantine. The Secretary of Agrarian Reform sits as a Board Director of the LANDBANK.

Under the Comprehensive Agrarian Reform Law, agricultural lands are distributed to qualified tenants, farmworkers, and tillers. Landowners are paid the just compensation of their lands. ARBs pay to the LANDBANK their awarded lands for thirty years with interest at six percent per annum. The recent LANDBANK Resolution suspends the obligation of the ARBs to pay the amortization for one year.

The LANDBANK Board also approved a 30-day grace period for loans with principal and/or interest falling due within the ECQ Period without incurring interest on interest, penalties, fees and other charges. It shall not charge or apply interest on interest, fees and charges during the 30-day grace period to future payments/amortizations of the individuals, households, micro, small and medium enterprises (MSMEs) and corporate borrowers.

It will also extend an emergency loan to local government units (LGUs) thru The HEAL (Help via Emergency loan Assistance for LGUs) Lending Program. Under the HEAL, LGUs (Provinces, Cities and Municipalities) including those whose IRA are not yet with LANDBANK are eligible to borrow. The eligible purpose is permanent working capital as additional source of fund for the provision of goods and services. The amount that an LGU may borrow will be based on the actual request of the LGU provided the total loan exposure (including the proposed emergency loan) will not exceed the net borrowing capacity (NBC) of the LGU per Bureau of Local Government Finance (BLGF). Loans under this program shall have an affordable interest rate of 5% per annum, fixed for the term of the loan. The loan shall be payable up to a maximum of five (5) years and shall be further based on the LGU’s cash flow with a maximum of one (1) year grace period on principal payment.

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