9 rural banks accredited under Agri-Agra law
NINE RURAL banks have been accredited by the Bangko Sentral ng Pilipinas
(BSP) so they can be lent to or invested in for the Agri-Agra Reform
Credit Act of 2009.
The following rural banks are "accredited rural financial institutions"
(ARFI) beginning Oct. 24, the BSP said in Circular Letter No. 2012-082
dated Nov. 13 and released yesterday:
• Rural Bank of Kiamba, Inc.;
• Producers Savings Bank;
• Rural Bank of Barili (Cebu), Inc.;
• Rural Bank of Sta. Catalina, Inc.;
• Community Rural Bank of Catmon, Inc.;
• Rural Bank of Bay, Inc.;
• Philippine Resources Savings Bank, Corp.;
• Rural Bank of Pilar (Bataan), Inc.; and
• Common Wealth Rural Bank, Inc.
"The accreditation issued by the BSP is solely for the purpose of
certifying that the loan portfolio of the above-listed ARFIs complies
with the qualification requirements prescribed under the relevant law,
rules and regulations," the circular read.
Republic Act No. 10000 or The Agri-Agra Reform Credit Act of 2009 was
approved by then President Gloria Macapagal-Arroyo in 2010 to encourage
banks to increase their loans to farmers, fisherfolk and agrarian reform
beneficiaries.
The law mandates banks to set aside 25% of their total loanable funds
for the agriculture and agrarian reform sectors. Aside from extending
loans and purchasing eligible loans from other banks, banks have
alternative modes to comply with the law.
These include paid subscription of shares of stock in ARFIs, wholesale
lending to ARFIs and investments in the special deposit accounts held by
ARFIs.
"Under existing regulations, the lending and/or investing bank is
required to disclose in its Agri-Agra report submitted to the BSP its
exposure to the ARFI..." the circular letter read.
"Such exposure to the ARFI shall be eligible for determining compliance
with the agri-agra requirement for as long as the ARFI remains
accredited with the BSP," it added.
The central bank clarified, though, that the accreditation concerns only
the Agri-Agra Reform Credit Act and does not serve as an endorsement of
the "safety and soundness" of the rural banks. -- Diane Claire J. Jiao
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CARLOS ANI - International Microfinance Consultant - SEEDFINANCE Corporation Chairman
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