Business

Recto nixes LandBank-DBP merger, pushes instead charter amendments

By Jeanne Michael Penaranda

MANILA – Finance Secretary Ralph G. Recto has put to the backburner the proposed merger of the Land Bank of the Philippines (LandBank) and Development Bank of the Philippines (DBP) which his predecessor Benjamin Diokno pushed..

Recto earlier noted that the two big government banks have their own distinct objections – support to farmers for Landbank and development for DBP.

During his reign at the finance department, Diokno was also widely criticized for “killing” also the Philippine Postal Savings Bank and the United Coconut Planters Bank, two government banks with their distinct objectives.

This as Recto has said the Department of Finance (DOF) is exploring the amendments to the charters of the Land Bank of the Philippines (LandBank) and Development Bank of the Philippines (DBP) “to broaden capital market”.

In a statement, the finance department said Recto made the statement in his speech at a reception hosted by the Philippine Stock Exchange in its headquarters in Bonifacio Global City on Feb. 21, 2024.

“We are exploring the amendments to the charters of the Land Bank of the Philippines and the Development Bank of the Philippines, including their possible public listing, to broaden the local capital market,” said Recto.

In a separate message, Recto said the DOF “has a draft bill for both” adding that more details will be disclosed soon.

LandBank is the largest development financial institution in the country promoting financial inclusion, digital transformation, and sustainable development to benefit Filipinos.

The DBP, on the other hand, is classified as a development bank and may perform all other functions of a thrift bank.

The bank aims to provide banking services principally to cater to the medium and long-term needs of agricultural and industrial enterprises with emphasis on small and medium-scale industries.