MANILA, Philippines — President Duterte has lowered the rates of dividends to be remitted by two state-run financial institutions to the national government to support their programs and ensure their financial viability.
The adjustment in the dividend rate of Land Bank of the Philippines (LBP) and Development Bank of the Philippines (DBP) is contained in Executive Order No. 89, signed by Executive Secretary Salvador Medialdea, by authority of Duterte, on Aug. 28.
Under the law, all government-owned or controlled corporations (GOCCs) are required to declare and remit at least 50 percent of their annual net earnings as cash, stock or property dividends to the national government.
The President, upon the recommendation of the finance department, may adjust the percentage of annual net earnings to be declared by a GOCC.
Finance Secretary Carlos Dominguez III has recommended the downward adjustment of the percentage of the selected years’ net earnings to be declared by the LBP and DBP as dividends to the national government “in the interest of national economy and general welfare.”
Instead of remitting 50 percent, LBP will remit zero percent of its net earnings for 2016 and 10 percent for 2017. The DBP, meanwhile, will remit zero percent of its net earnings in 2017.