CORN farmers belonging to the Philippine Maize Federation (PhilMaize) urged President Duterte and lawmakers to investigate the $85-million loan extended by the Land Bank of the Philippines (LandBank) to Hanjin Heavy Industries and Construction Co.-Philippines (HHIC-Phil).
PhilMaize President Roger V. Navarro said LandBank’s loan to Hanjin’s Subic shipyard is against its mandate to prioritize the provision of financial aid to Filipino farmers and fishermen.
“The loan to Hanjin is a slap in the face for the agriculture sector. The Philippine subsidiary of the Korean firm is not even in the agriculture or food sector. The President should look into this and find out why [a shipyard] was prioritized over farmers,” Navarro told the BusinessMirror.
LandBank President and CEO Alex V. Buenaventura told reporters earlier that the bank’s exposure to Hanjin is around $85 million, expressing hope that the bank can recover its exposure.
“We have an $85-million exposure there. We’ll have to address the problem. But the good news is that we can recover because the assets of the shipyard are worth $1.2 billion, and the total exposure of the creditors is less than $400 million; down the road we hope to recover our exposure,” Buenaventura said.
“I think the shipping industry is a very important industry, supporting global development. The global economy is improving, the time will come, and I think it’s around the corner, there will be a lot of moving goods through ships,” he added.
But Navarro said the default of the Korean company is “lamentable” considering that agriculture-related projects, such as PhilMaize’s own rice-corn blend project, are in need of assistance from the state-run financial institution to take off.
“LandBank can’t even condone the loans of farmers’ cooperatives. These cooperatives bring food to the tables of Filipino families. What a display of misplaced priorities,” he said.
Navarro said PhilMaize would write to President Duterte, lawmakers and to Agriculture Secretary Emmanuel F. Piñol to air their concerns over LandBank’s loan to Hanjin.
Last year President Duterte ordered LandBank to go back to its original mandate of helping farmers and fishermen.
Earlier, Finance Secretary Carlos G. Dominguez III said LandBank and other four creditor banks of Hanjin should focus on working together to address the financial fallout from the troubles of the
giant Korean shipbuilder.
“LandBank has an exposure to Hanjin, together with other banks. I don’t know the exact exposure of the other banks, but definitely, we are not the largest single lender. It’s a problem, we have to address it.
“There are assets to be had, and this is a difficult problem; it has to be worked through by the banks,” said Dominguez, who is also chairman of LandBank. On January 9, the BusinessMirror broke the story that Hanjin filed for corporate rehabilitation at the Olongapo Regional Trial Court, seeking protection from its creditors.