DBP extends P6.13-B loan to Covid-hit businesses

MANILA – The Development Bank of the Philippines (DBP) has extended PHP6.13 billion in loans to enterprises badly hit by the economic shock of the coronavirus disease 2019 (Covid-19) pandemic and earmarked interest subsidies amounting to PHP27.13 million to local government units (LGUs) last year in line with its goal to help keep the productive sectors of the economy afloat during this global crisis.


DBP president and chief executive officer Emmanuel Herbosa said that to provide the bank with additional resources to help fund these efforts and the country’s economic recovery program starting this year, it plans to issue a USD300-million bond by mid-2021, along with the second tranche of its sustainability bonds sometime in November.


“These will not only provide the bank with the necessary liquidity to fuel the country’s economic recovery efforts but will also aid in the development of the Philippine capital markets moving forward,” Herbosa said in his presentation of DBP’s 2021 plans to Finance Secretary Carlos Dominguez III.


As part of DBP’s innovative financing solutions, Herbosa said it is also planning to develop an LGU credit rating system together with the Department of Finance (DOF)-attached Bureau of Local Government Finance (BLGF) and the International Finance Corporation (IFC) in support of the development of a bond market for LGUs.


“Agri-Agra compliant bonds are also on the horizon as this will be timely upon the passage of the amendments to the Agri-Agra Law in support of the development of agriculture and agrarian reform,” he said.


Herbosa said DBP is also eyeing the development of an alternative trading system “in the near future” to anticipate the growth of the Philippine finance market.


This year, DBP will step up implementation of its RESPONSE and ASENSO programs to continue supporting industries and enterprises that have been gravely affected by the pandemic, Herbosa said.


“We have adopted this year a revised theme of ‘Strengthen Organizational Resilience’ to put stress on strengthening our internal capability to continue the development and rehabilitation initiatives for the country, post-pandemic,” he said.


To assist in this effort, DBP will fully operationalize this year its six new Provincial Lending Centers in support of the targeted 7-percent growth on its loan portfolio to reach PHP451.06 billion by year-end, Herbosa said.


“This growth duly considers DBP’s commitment under Bayanihan 2 to actively assist borrowers from micro, small, and medium enterprises (MSMEs) even as we keep our focus on supporting the infrastructure needs of the country,” he said. (PR)


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