Land Bank of the Philippines (LBP; often referred to simply as LandBank), is a government-owned bank in the Philippines with a special focus on serving the needs of farmers and fishermen. While it provides the services of a universal bank, it is officially classified as a "specialized government bank" with a universal banking license.
Unlike most Philippine banks, LandBank has an extensive rural branch network with 409 Branches and Extension Offices, 46 Lending Centers and 2,188 ATMs (as of February 2020).[2] It services many rural sector clients in areas where banking is either limited to rural banks or is non-existent.
History
LandBank was established on August 8, 1963, as part of the Agricultural Land Reform Code as part of a program of land reform in the Philippines. It was to help with the purchase of agricultural estates for division and resale to small landholders and the purchase of land by the agricultural lessee.[3]
In 1965, LandBank's by-laws were approved and its first board of trustees was formed, with the Secretary of Finance as chairman.
On October 21, 1972, Presidential Decree No. 27, signed by President Ferdinand Marcos, emancipated all tenant farmers working on private agricultural lands devoted to rice and corn, whether working on a landed estate or not. The system was implemented through a system of sharecropping or lease-tenancy. LandBank was tasked to collect 15-year land amortizations from beneficiaries at the cost of the value of the land plus six percent interest per annum.[4]
By 1973, LandBank was in financial distress. It lacked the resources and the capital needed to implement the land reform programs and lacked the structure to implement the programs efficiently. On July 21, Marcos signed Presidential Decree No. 251 which revitalized the bank. The decree granted LandBank a universal banking license (the first bank in the Philippines to be issued such a license) with a social mission to spur countryside development. The decree expanded LandBank's powers to include lending for agricultural, industrial, homebuilding and home-financing projects and other productive enterprises, as well as lending to farmers' cooperatives and associations to facilitate production, marketing of crops and acquisition of essential commodities. LandBank was also required by the decree to provide timely and adequate support in all phases involved in the execution of agrarian reform and also increased its authorized capital to ₱3 billion. It also became exempted from all national, provincial, city and municipal taxes and assessments.[5]
LandBank was reorganized in 1977 when it was divided into three sectors to better assess the needs of its customers. It was divided into Agrarian, Banking, and Operations sectors to strengthen operations and ensure long-term viability.[6]
In 1982, the Agricultural Credit Administration (ACA), established under the same law as LandBank, was abolished and all its assets and functions transferred to LandBank. ACA's function was to extend credit to small farmers. Also in this year, Union Bank of the Philippines (UnionBank) was formed, with LandBank having a 40-percent stake in the government-owned commercial bank.[7]
LandBank became the financial intermediary for the Comprehensive Agrarian Reform Program (CARP) in 1988. It was also in that year that UnionBank started a gradual privatization. The Aboitiz Group of Companies acquired LandBank's 40% share of UnionBank then which it continues to own. LandBank also became the third member of Expressnet, an interbank network in December 1991 but now a BancNet member.
On February 23, 1995, LandBank's charter was once again amended. Its authorized capital was increased to ₱9 billion and it became an official government depository. The number of members of the board of trustees was also increased to nine whereas the Secretary of Finance, as Chairman, the President of the Bank as Vice-Chairman, the Secretary of Agrarian Reform, the Secretary of Labor, and the Secretary of Agriculture as ex officio members.[8]
On August 25, 1998, LandBank's authorized capital was once again increased to 25 billion pesos, and it then increased to 200 billion pesos, after the planned DBP–LandBank merger in 2016.
On June 25, 2021, President Rodrigo Duterte signed Executive Order No. 142 which mandates the merging of LandBank with the United Coconut Planters Bank (UCPB), with LandBank as the surviving entity.[13][14]
On the other end of the spectrum, LandBank takes on a dual role with the Development Bank of the Philippines, another government-owned bank. It either competes against or works with DBP, depending on the situation.
.jpg)
