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CFIEP-2020 CAP


Countryside Financial Institutions Enhancement Program (CFIEP) – 2020 Calamity Assistance Program (CAP)

CFIEP - 2020 CAP brochure

DESCIPTION

The Coronavirus Disease 2019 (COVID-19) outbreak is expected to significantly impact the Philippine economy. Among those that are seen to be affected is the CFI sector in terms of risk related to exposures to borrowers and/or industries or businesses as well as disruptions in operations due to measures being implemented by the Government to control the spread of the virus.

 

With these recent calamities and disasters that beset the country, the CFIEP - 2020 CAP was launched to provide additional support to CFIs.

 

OBJECTIVES

The program aims to:

1. Assist eligible CFIs adversely affected by natural calamities and man-made disasters, pest and diseases, viral infections/outbreaks; and

2. Enhance and sustain CFI’s long-term viability.

 

ELIGIBLE BORROWERS

CFIs (i.e., Cooperative Banks, Rural Banks, Thrift Banks) that have been affected by the following:

1) Natural calamities such as typhoons, earthquakes, volcanic eruption, and other calamities as declared by the Office of the President, the National Disaster Risk Reduction and Management Council, or the Local Government Units;

2) Man-made disasters such as water or other armed-conflict acts of terrorism; and

3) Epidemic or pandemic outbreak of human and/or animal disease or plant manifestation as declared by the Department of Health, Department of Agriculture or other appropriate government agencies or instrumentalities

 

ELIGIBLE LOAN PURPOSE

Additional working capital to eligible CFIs for on-lending to small farmers and fishers (SFF), cooperatives and farmers & fishers organizations, micro, small and medium enterprises (MSME) and other borrowers, such as large agri-business enterprises and salaried employees

Click here to see the CFIEP - 2020 CAP brochure.

RISK ASSET ACCEPTANCE CRITERIA

PARAMETERS

CRITERIA

Character

  • No adverse findings on the borrower and its principal officers (Directors/Key Officers)

Capacity

  • With well-defined source of repayment
  • At least three (3) year profitable operations based on Audited Financial Statements
  • With net past due ratio of not more that 15%, prior to the occurrence of calamity/disaster/outbreak

Capital

  • Meets the minimum capitalization required by BSP
  • Meets the BSP’s prescribed capital adequacy ratio (CAR) of not less than 10%, prior to the occurrence of calamity/disaster/outbreak
  • With Tier 1–risk based ratio of 6% or better

Condition

  • Positive/favorable outlook of the banking industry

Others

  • With loan portfolio affected by calamities/disasters/outbreaks subject to validation by the LBP Lending Center (LC)

 

LOAN FEATURES

Availability Period

  • Two (2) years from the official date of declaration of state of calamity/disaster of the area, or declaration of disease/viral outbreak or infestation
  • For those affected by COVID–2019 - up to June 30, 2021
  • For armed conflict/war-devastated areas-two - (2) years from declaration that the said

Credit Facility

  • Term Loan – Working Capital

Loanable

Amount

  • Equivalent to 90% of the affected existing portfolio of the CFI, or PHP 10 Million, whichever is lower, provided the loan amount does not exceed the CFIs borrowing capacity based on LBP policy

Loan Tenor/ Repayment Term

  • Maximum five (5) years, payable in equal quarterly or semi-annual amortizations, for the principal and interest
  • Loan amortizations shall be covered by post-dated
  • checks

Grace Period

  • Up to one (1) year grace period on principal and interest may be granted based on projected cash flow

Interest Rate

  • 4.5% per annum (p.a.) fixed for one (1) year, subject to annual repricing thereafter, based on one (1) year BVAL rate plus 0.75% spread, but not lower than 4.5% p.a.

Pass-On Rate

  • For SFFs

− maximum of 12% p.a., inclusive of other charges

  • Other than SFFs but for agricultural purposes –

− maximum of 12% p.a.

  • For non-agricultural purposes

− 15% p.a.

Penalty for

Loan Default

  • 24% p.a., with sixty (60) days grace period

Other Fees

and Charges

  • Standard fees and charges shall apply
  • Application, Credit Information/Background Investigation, commitment and pre-termination fees shall be waived

Credit

Enhancer

  • Post-dated checks

 

DOCUMENTARY REQUIREMENTS

1. Certified true copy of the Certificate of Registration with the Securities and Exchange Commission

2. Certified true copy of the Articles of Incorporation/Cooperation and By-laws;

3. Board Resolution authorizing the CFI to borrow and designate at least two (2) officers to negotiate a loan with LBP and sign loan documents with their specimen signatures and photos of authorized signatories;

4. Audited Financial Statements (FS) for the last three (3) years plus latest interim FS prior to the calamity/disaster/outbreak.

5. Latest report on CAR submitted to Bangko Sentral ng Pilipinas