State-owned Land Bank of the Philippines (LandBank) on Sunday said it remains adequately capitalized even with the bank’s PHP50 billion seed capital to the Maharlika Investment Corporation (MIC).
In a statement, the bank said it remains strong, adequately capitalized, and compliant with regulatory requirements of the Bangko Sentral and Pilipinas (BSP).
“Even with the bank’s PHP50 billion seed capital to the MIC as mandated by Republic Act No. 11954, otherwise known as the Maharlika Investment Fund Act of 2023, the bank will meet its CAR (capital adequacy ratio) requirements,” LandBank said.
As of June 2023, the LandBank’s total assets amounted to PHP3 trillion or 7.9 percent higher than PHP2.8 trillion in the same period a year ago.
Net income stood at PHP20.9 billion from loans and investments earnings, exceeding its first-half target by 19 percent or PHP3.3 billion.
LandBank’s capital growth was at 14.4 percent to PHP236.3 billion from PHP206.5 billion in 2022.
The BSP tracks the CAR and Common Equity Tier 1 (CET 1) ratio of banks to ensure that they are capable of absorbing a reasonable amount of financial risks and still comply with statutory capital levels.
Both capital ratios are essential as it indicates a bank’s financial strength and how well it can weather financial challenges.
A higher CAR means a bank is more financially stable and secure. (PNA)