A local government unit, three micro-finance institutions and non-government organizations, and 27 micro, small and medium enterprises (MSMEs) in Catanduanes have expressed interest in securing loans totaling P69.5 million from the Development Bank of the Philippines (DBP), which would establish a branch in Virac in the 3rd quarter of 2011.
According to the Department of Trade and Industry (DTI) provincial office, which sponsored last week’s financing forum with DBP, the municipal government of San Andres is keen in borrowing P35 million for its proposed fishport and terminal while the micro-finance institutions and NGOs have submitted applications for P4.5 million in loans.
The MSMEs, on the other hand, would like to secure a total of P30 million in credit from DBP for their handicraft, trucking, trading, poultry and other small businesses, including financing for the operation of local schools.
Seventy-six participants, including local chief executives and municipal officials from seven towns, local businessmen and manufacturers as well as NGO and MFI representatives, joined the forum held at the Philippine Red Cross Training Hall at the EBMC compound. Among them were members of the Catanduanes Chamber of Furniture Makers, the Catanduanes Producers Association, Inc., ARDCI, and cooperatives like PROVEMCO and PLDC.
Also present were Governor Joseph Cua, whose administration is planning to construct a convention hall in Virac large enough to host national and regional conferences, PBMs Nel Asanza, Rafael Zuniega and Roger Pereyra, San Andres Mayor Antonio Romano, Viga Vice Mayor Emeterio Tarin, and Virac Councilor Ephraim Antonio Gianan.<
Low deposit utilization rate
Senior Assistant Vice President Abelardo L. Monarquia, head of the Regional Marketing Center at DBP Naga, told the audience that most of the 261commercial, thrift and rural banks in Bicol brings their deposits to the head office, unlike DBP which uses 98 percent of its deposits for loans to entities in the region.
Of the P1.943 billion deposits in Catanduanes, of which majority are LGU accounts, only 19 percent is utilized for loans in the province, he said, compared to Camarines Sur which has a 32 percent deposit utilization rate.
Monarquia disclosed that the DBP’s investments in Bicol is now at over P2.5 billion, through loans for public and private infrastructure, environmental projects, MSMEs, social services, and commercial and industrial projects, with about P60 billion available for borrowers nationwide. Catanduanes borrowers’ loan accounts only total P383,000.00.
Easy loan terms for borrowers
Explaining the guidelines of the DBP’s enhanced retail lending, Senior Vice President Cresenciana Bundoc, head of Branch Banking Sector at the DBP Head Office, said MSMEs with an asset size not exceeding P15 million could avail of loans ranging from P150,000.00 to P10 million for working capital, acquisition of equipment or machinery, or plant expenses.
The loans could be approved in just 12 working days, she said, provided all the required documents, the number of which have been reduced, are complete. The loans have terms not exceeding 10 years and carry a grace period of three years, meaning the borrower would only have to pay for the interest during the period.
All fees are already included in the interest rate, Bundoc said, except for the documentary stamp and the application fee of P1,000.00 or 0.1% of the loan value, whichever is higher. The collateral requirement is also liberal, she added, ranging from clean titles, unregistered mortgages or tax declaration, postdated checks or assignment of receivables.
The senior DBP official said that the bank will ask Gov. Cua to allow DBP to put up a desk at the provincial capitol to attend to clients pending the establishment of its Virac branch.
Manufacturers welcome DBP’s thrust
Micro, small and medium enterprises immediately welcomed the DBP offer with loud applause. "Bakit ngayon pa lang pumasok ang DBP sa Catanduanes?," Cesar Angeles, CPAI president asked. "Hirap na hirap na po kami."
SVP Bundoc clarified that even without a local branch, the government bank has been reaching out to Catandunganons, citing loans granted to furniture maker Amparo Teves and hardware store owner Efren Vargas.
Shortly after the program, DBP branch managers from the five branches in Bicol as well as other officials in the team fanned out to the different tables to discuss loan applications with the LGUs, local traders and manufacturers.Source: Catanduanes Tribune - 04 November 2010