MANILA, Philippines — The country’s largest corn growers have chided the Land Bank of the Philippines (LBP) for prioritizing loans of big foreign firms over Filipino farmers.
“LBP had just been defaulted with some $85 million loan from Hanjin Heavy Industries and Construction Philippines but LBP can’t even condone farmer’s cooperatives loan who supply food in our table,” Philippines Maize Federation (PhilMaize) president Roger Navarro said.
Navarro said this shows the bank favors only large-scale loans, adding that LBP’s loan to the Hanjin group is a “display of misplaced priority.”
Last week, Hanjin filed a petition for rehabilitation at the Olongapo City Regional Trial Court after defaulting on over $400 million loans owed from local banks, on top of another $900 million in debts with lenders in South Korea. The company is the biggest foreign investor and top employer at the Subic Bay Freeport.
LBP president and chief executive officer Alex Buenaventura earlier expressed confidence that the bank could recover its $85 million loan exposure to Hanjin, given that the assets weigh higher than the liabilities.
“We’ll have to address the problem. But the good news is we can recover the assets. The shipyard is worth $1.2 billion and the total exposure of the creditors is $400 million. Down the road, we hope to recover our exposure,” Buenaventura said.
Department of Finance (DOF) Secretary Carlos Dominguez said that the banks’ exposure to the loan would hurt, but not hamper them.
Navarro also expressed hope that LBP corrects its priorities and focus on the agriculture sector.