THE Department of Finance (DOF) on Sunday said the capital infusion by the Development Bank of the Philippines (DBP) and the Land Bank of the Philippines (LandBank) to the Maharlika Investment Corp. (MIC) did not impact their “loanable funds” to farmers and other sectors.
Finance Secretary Benjamin E. Diokno said the contributions made by the two state-run banks were “secured from their investible funds.”
Diokno claimed that LandBank and DBP continue to “maintain” a “solid” financial position even after their respective capital infusions to the MIC.
“The participation of these government financial institutions [GFIs] would help increase the MIF’s investment base and could result in significantly higher rates of returns,” he said.
“We are continuously talking to all stakeholders involved in order to ensure the best possible outcome for the Fund. Both LBP and DBP are resolute in their commitment to responsible financial management and shall have proper representation in the Board,” he added.
The Marcos Jr. administration recently pitched the Maharlika Investment Fund (MIF) to various business leaders in the Kingdom of Saudi Arabia during a recent roundtable meeting.
“Maharlika seeks to work with other sovereign wealth funds, both as an investment partner and peer in the global sovereign wealth fund community. We look forward to exchanging views and learning from the best practices of top-of-class funds, such as those here in Saudi Arabia,” Diokno said.
Minister of Saudi Arabia Khalid A. Al-Falih expressed interest in MIF, noting that the Philippines is one of the “exciting markets” in Asean, according to the DOF.
The DOF quoted Marcos as saying the Philippines is looking forward to Saudi Arabia’s “investments and insights from its extensive experience in financial management.”
Last week, LandBank said its capitalization as of the first half remains more than adequate to cover its financial risks despite contributing to the country’s MIC.
LandBank said its Capital Adequacy Ratio (CAR) at end-June stood at 16.61 percent, “well above” the 10-percent minimum requirement of the Bangko Sentral ng Pilipinas (BSP).
The DBP has also been revealed to have sought regulatory relief from the BSP due to concerns that it might find it difficult to comply with the minimum CAR requirement after contributing to the MIC.