Some residents in Sual town, Pangasinan province took to the streets on Monday, November 29, 2021, to protest the planned P500 million bank loan made by the municipal government. (Photo by Yolanda Sotelo)
DAGUPAN CITY — Saying all its loan transactions are “above board,” the Land Bank of the Philippines (LandBank) reiterated that the P500 million loan of the Sual municipal government, which is being opposed by the town residents, was compliant with the bank’s standards and policies.
In a statement on Thursday, LandBank said the term loan “is compliant with the set standards and policies of the bank under its LGU Lending Program and in accordance with pertinent laws, regulations and policies.”
The government financing institution said the local government may avail of credit facilities to finance local infrastructure and other socioeconomic development projects in accordance with the approved local development plans and public investment program.
“(This is) subject to the submission of a Sangguniang Bayan (SB) resolution and ordinance authorizing the Local Chief Executive to sign and enter into a loan agreement with the Bank,” LandBank said.
It added: “The Sual LGU’s loan has been duly authorized by a majority vote of the Sangguniang Bayan (SB) which was affirmed by the Sangguniang Panlalawigan (SP) of the Province of Pangasinan.”
The bank said the net borrowing capacity of the Sual government, which confirms its capacity to pay back the loan, has also been certified by the Bureau of Local Government Finance.
“The terms and conditions of the loan have been approved and ratified through an ordinance,” LandBank said.
On Monday, close to 2,000 residents from different villages marched around the town to show their objection to the planned P500 million loan of the municipal government from the LandBank.
They claimed the loan would sink the town into a debt that would be paid in 15 years, which, at five percent annual interest, would have an accrued interest of P325 million.