The organization published this in their annual report.
The International Monetary Fund (IMF) has called on the Philippine government to restore with immediacy the capital of state-owned banking institutions Landbank of the Philippines (LBP) and the Development Bank of the Philippines (DBP).
“Implementing capital restoration plans for two state-owned banks following their contribution to the Maharlika Investment Corporation’s start-up capital and exiting regulatory relief as soon as possible is important,” the IMF noted.
The said organization also added that the establishment of the Maharlika Investment Corporation (MIC), the sovereign-wealth fund founded by the Marcos, Jr. administration in 2023, “should not come at the cost of a resilient financial system, sound regulatory framework, and level-playing field.”
The LBP and DBP respectively infused Php 50 billion and Php 25 billion to raise the initial Php 500 billion capital for the Maharlika fund, which will reportedly be used to invest in various sectors like energy.
In order to this, the banks have sought a “regulatory relief” from the Bangko Sentral ng Pilipinas to allow them to temporarily be excluded from rules on minimum capital requirements, which should be around Php 3 billion to Php 20 billion.
Landbank had a Php 200 billion capital, while the DBP had Php 35 billion.
In the past, there have been proposals for the merger of both entities, but these have since been called off and the LBP and DBP remain separate state-owned banks up to this day.