President Ferdinand R. Marcos Jr. has adjusted the percentage of annual net earnings to be declared by the state-run Land Bank of the Philippines for 2022 to support its financial viability.

Under Executive Order (EO) 43 inked by Marcos on Oct. 11 and made public on Saturday, the dividend rate of LandBank was cut to zero percent from the current 50 percent of its annual earnings.

“The adjusted dividend rate set forth in Section 1 of this Order is applicable only to the (LandBank) for CY (calendar year) 2022,” the EO read.

Upon the recommendation of Finance Secretary Benjamin Diokno, the downward adjustment was made “in the interest of national economy and general welfare.”

Marcos ordered the reduction in the dividend rate to support LandBank’s capital position, maintain its compliance with the Bangko Sentral ng Pilipinas’ regulations on capital adequacy requirements, and expand its role in the economic recovery of industries adversely affected by the coronavirus disease 2019 pandemic.

“Through its various programs, the Land Bank of the Philippines (LBP) aims to provide credit support to the agricultural sector, including around 3.6 million Filipino farmers and fisherfolk, and other key players in the agri-business value chain, and promote financial inclusion, digital transformation, and sustainable development for the benefit of all Filipinos,” EO 43 said.

Under Republic Act (RA) 7656, all government-owned and -controlled corporations (GOCCs) are mandated to declare and remit at least 50 percent of their income to the national government.

RA 7656 also authorizes the President, upon the recommendation of the Secretary of Finance, to adjust the percentage of annual net earnings to be declared and remitted by a GOCC.

EO 43 takes effect immediately. (PNA)

Photo credit: Facebook/landbankofficial