RURAL BANKS will work with the government to support small businesses and the agriculture sector amid the ongoing coronavirus crisis and the impact of Typhoon Odette, an industry leader said.
“We are seeing the negative effects of climate change to the agricultural sector and to the banks as a whole,” Rural Bankers Association of the Philippines President Albert T. Concha, Jr. said in a Viber message.
“We will continue to work with the BSP and other government agencies like the Department of Agriculture and Philippine Guarantee Corp. to come up with various risk mitigants and allow rural banks to continue lending to farmers and MSMEs (micro-, small-, and medium-sized enterprises),” Mr. Concha said.
The agriculture sector, which is among the industries that rural banks mostly cater to, was badly hit by Typhoon Odette last month.
Agricultural damage caused by the typhoon hit P9 billion in 12 regions, based on data from the Agriculture department as of Dec. 31.
Meanwhile, Mr. Concha called on players in the electricity and telecommunications sectors to craft measures to ensure continued services despite calamities.
“Total blackout of internet and electrical services merely due to fallen poles is no longer acceptable. They must find ways simply because typhoons and other calamities will always happen again and again,” he said.
Rural banks posted a cumulative net income of P3.204 billion as of September 2021, up by 33.5% from the P2.399 billion seen in the same period of 2020.
Their assets stood at P280.918 billion as of September 2021, increasing by 11.4% from the P252.084 billion a year earlier.
The central bank has urged lenders to include environmental and social risks in their credit underwriting processes.
The BSP told banks to assess the possible impact of climate-related disturbances on their operations and their capability to withstand disruptions.
The Philippines incurred about P506.1 billion in damage caused by climate-related hazards from 2010 to 2020. — L.W.T. Noble