Experience Effortless Banking

8 August 1963
Republic Act 3844 (Agricultural Land Reform Code)

• Created the Land Bank of the Philippines (LBP) to finance the acquisition and distribution of agricultural estates for division and resale to small landholders as well as the purchase of the landholding by the agricultural lessee;
• Authorized capitalization of 1.5 billion Php.  Initial capital of 200 million Php;
• Members of the Board of Trustees
  • Chairman -  LBP President & CEO
  • One member elected by the holder of preferred shares
  • 4 Members: including the Head of Land Authority (now Dept. of Agrarian Reform)
• Tax exempt on all operations, holdings, equipment, property, income and earnings;
• Exempted from cash or stock dividend payments to the National Government;
• Agricultural Credit Administration (ACA) responsible for extending credit assistance to farmers cooperatives and directly to small farmers

Adoption of By-Laws and Creation of Board of Trustees

• Adopted the by-laws, established the first organizational chart and manual of operations in 1965;
• Formed the Board of Trustees with the Secretary of Finance as chairman in 1966

21 October 1972
Presidential Decree 27 (Tenant Emancipation Act)

• Emancipation of tenant-farmers of private agricultural lands devoted to rice and corn under a system of share-crop or lease-tenancy, whether classified as landed estate or not;
• Value of  land transferred to tenant-farmers at 2 1/2 times the average
• Harvest of 3 normal crop years immediately preceding the promulgation of PD 27;
• LBP to collect 15-year land amortizations from beneficiaries for the cost of the land plus 6% interest per annum

21 July 1973
Presidential Decree 251 (Revitalizing LANDBANK)

• Because LBP was deficient and inadequate both in capitalization and in organization structure to meet the implementation requirements of agrarian reform, the Bank was revitalized;
• Granted universal or expanded commercial banking powers to LBP and established LBP as the universal bank with a social mission of spurring countryside development;
  • to cross-subsidize agrarian land transfer and loans to small farmers and fisherfolk;
• Expanded LBP's powers to include lending to agricultural, industrial, home-building or home-financing projects and other productive enterprises;
  • to ensure LBP's financial stability and sustainability;
• Empowered LBP to grant loans to farmers cooperatives/associations to facilitate production, marketing of crops and acquisition of essential commodities;
• LBP mandated to provide timely and adequate support in all phases involved in the execution of agrarian reform;
• Increased authorized capitalization to 3 billion Php ;
• Increased the members of the Board of Directors to seven (7):
  • Chairman - Secretary of Finance
  • Vice-Chairman - LBP President
  • Members (Ex-Officio)
    • Secretary of Agrarian Reform
    • Secretary of Labor  -
    • Three Members  - elected annually
  • Exempted from all national, provincial, municipal & city taxes and assessments

1977
Reorganization

• LBP formed three major sectors - Agrarian, Banking and Operations to strengthen operations and ensure long-term viability

8 July 1982
Executive Order 816 (Transfer of ACA to LBP)

• To adopt an integrated approach in the provision of financial assistance to AR farmer-beneficiaries a single institution is preferred;
• ACA was abolished and its functions (loans to small farmers) were transferred to LBP

22 July 1987
Executive Order 229 (CARL)

• Created the Presidential Agrarian Reform Council (PARC) as the highest policy-making and coordinating body of the Comprehensive Agrarian Reform Program (CARP) to ensure timely and effective delivery of the necessary support services;
• Established the Agrarian Reform Fund (ARF) with an interim amount of 50 Php billion to cover the financing requirements of CARP with appropriations coming from the proceeds of the Asset Privatization Trust and the Presidential Commission on Good Government;
• FBs to pay for lands acquired and redistributed by the government  in 30 equal annual amortizations at 6% p.a. with the first payment due one year after resale (annual amortization should not exceed 10% of the land's annual value of gross production);
• LBP to provide assistance to landowners through:
  • investment information and counselling assistance.
  • conversion and/or exchange of LBP Agrarian Reform bonds to/from government stocks with government assets.
  • marketing of LBP Agrarian Reform bonds.

10 June 1988
Republic Act 6657 (CARL)

• Broadened the coverage of agrarian reform to include all public and private agricultural lands including other lands of the public domain suitable for agriculture;
• Payment to landowners at 25% to 35% cash and the balance in 10-year Agrarian Reform bonds with a yield of 91-day T-bills;
• Authorized LBP to collect from the FBs payment for lands awarded to them in 30 annual amortizations at 6% per annum;
• Established LBP as the financial intermediary of the CARP.

14 June 1990
Executive Order 405 (CARP Land Valuation)

• Transferred the primary responsibility of determining land valuation and compensation for all lands covered under CARP from the DAR to the LBP;
• Accelerated and streamlined certain procedures in land valuation and compensation;
• LBP created regional Land Valuation and Landowners Compensation Offices (LVOs) to carry out land valuation and compensation.

23 February 1995
Republic Act 7907 (Amended LBP Charter)

• Increased authorized capitalization to 9 billion Php ;
• Established LBP as an official government depository;
• Increased the members of the Board of Directors to nine (9) composed of:
  • Chairman - Secretary of Finance
  • Vice- Chairman - LBP President and CEO
  • Members:
    • Secretary of Agrarian Reform.
    • Secretary of Labor.
    • Secretary of Agriculture.
    • 2 Representatives of Agrarian Reform Beneficiaries.
    • 2 Representatives from the Private Sector.

25 July 1995
Executive Order 267 (CARL)

• National Government to issue Agrarian Reform (AR) bonds to be used by LBP for land transfer payments;
• Segregation of the accounts of CARP-related transactions from the books of  LBP;
• CARP accounts and AR bonds were previously part of LBP's books and adversely affected LBP's financial position (leverage and capital adequacy ratios).

25 August 1998
Increase of Authorized Capital 

• Authorized capitalization increased to 25 billion Php by the Department of Finance and the President of the Philippines.