Article 121Labor and Agrarian Laws and Social Legislation, p. 121

LABOR LAWS AND SOCIAL LEGISLATION SPECIAL LAWS AND IMPLEMENTING RULES AND REGULATIONS

acceptances, credits, loans, transactions or obligations are

utilized

or

earmarked

for

the

development

and/or

expansion of agriculture and industry;

10. To borrow from, or rediscount notes, bills of

exchange and other commercial papers with, the Central

Bank.

The

rate

of

interest

to

be charged and the

conditions on such obligations or borrowings shall be

subject to the rules and regulations of the Monetary

Board;

11. To act as trustee, or administer any trust or

hold property in trust in accordance with the provisions of

law governing trust corporations;

12. To act as an official government depository

with

full

authority

to

maintain

deposits

of

the

government,

its

branches,

subdivisions

and

instrumentalities,

and

of

government-owned

or

-controlled corporations which deposits shall be subject

to liquidity floor and/or reserve requirements as may be

imposed by the Monetary Board upon other commercial

banks;

13. For the strengthening of the capital base of

the bank, to establish a national marketing umbrella for

farmers and fisheries cooperatives to attract massive

capital

formation

from

savings

deposits

of

the

cooperative members nationwide. (Amendment to R.A.

No. 3844 (Code of Agrarian Reform in the Philippines),

Republic Act No. 7907, [February 23, 1995])

14. To exercise the general powers mentioned in

the Corporation Law and the General Banking Act , as

amended,

insofar

as

they

are

not

inconsistent

or

incompatible with this Decree. (Amending R.A. No. 3844

As Amended (Code of Agrarian Reform), Presidential

Decree No. 251, [July 21, 1973])

15. To offer and issue common and preferred

shares of stocks to ARBs, small farmers and fisherfolk

through

their

organizations, cooperatives, federations

and

cooperative

banks;

development

partners

and

strategic

investors

such

as

multilateral and bilateral

institutions;

rural

banks

and

their

associations,

in

quantities to be determined by the Board of Directors

and

in

accordance

with

applicable

laws,

rules

and

regulations:

Provided,

however ,

That

the

National

Government

shall

maintain,

at

all

times,

at

least

two-thirds

(2/3)

ownership

of

the

total

outstanding

common shares of the Bank.

Preferred shares of stock shall be non-voting.

Other features of preferred shares shall be determined by

the Board of Directors in accordance with applicable laws

and regulations. (Direct Credit Support of Land Bank to

Agrarian

Reform

Beneficiaries,

Small

Farmers

and

Fisherfolk, Republic Act No. 10878, [July 17, 2016])

Section 76. Issuance of Bonds - The bank shall, upon

recommendation of the Secretary of Finance and after

consultation

with

the

National

Economic

and

Development Authority and the Monetary Board, and

with the approval of the President of the Philippines,

issue bonds, debentures, securities, collaterals and other

evidences

of

indebtedness

and/or

the

renewal

or

refunding thereof, at such terms, rates and conditions as

the Bank may determine, up to an aggregate amount not

exceeding, at any one time, ten times its paid-in capital

and surplus. These bonds and other obligations shall be

redeemable at the option of the Bank at or before

maturity and in such manner as may be stipulated

therein and shall bear such rate of interest as may be

fixed by the Bank. Such obligations shall be secured by

the assets of the Bank including the stocks, bonds,

debentures, and other securities underwritten, purchased

or held by it under the provisions of this Decree. Such

obligations

may

be

issued

in

payment

and/or

replacement of certain assets transferred to the Bank

and/or offered for sale at such price or prices as the Bank

may determine, and shall be exempt from taxation both

as to principal and interest, and shall be fully guaranteed

by the Government of the Republic of the Philippines,

and such guarantee shall be expressed on the face

thereof.

These instruments of indebtedness shall be

negotiable and may be mortgaged in accordance with

established banking procedures and practices with the

government institutions, their existing charters and/or

laws to the contrary notwithstanding, to enable the

holders

of

such

bonds

to

make

use

of

them

in

investments

in

productive enterprises. The Board of

Directors shall have the power to prescribe rules and

regulations

for

the

issuance,

reissuance,

servicing,

placement

and

redemption

of

the

bonds

herein

authorized to be issued as well as the registration of such

bonds

at

the

request

of

the

holders

thereof.

(Amendments to RA No. 3844 (Agricultural Land Reform

Code), Republic Act No. 6389, [September 10, 1971], further

amended by Presidential Decree No. 251, [July 21, 1973])

Section 77. Issuance of Preferred Shares of Stock to

Finance Acquisition of Farm Lots and Other Assets - The

Bank shall issue, from time to time, preferred shares of

stock in such quantities as may be necessary to pay the

landowners

in

accordance

with

Section

eighty

and

eighty-one of this Code, and for acquisition of other assets

should the seller elect to accept such payment. The

amount of shares that the Bank may issue shall not

exceed

the

aggregate

amount

needed

to

pay

the

landowners in the proportion prescribed in said Section

eighty of this Code. The Board of Directors shall include as

a necessary part of the by-laws that it shall issue under

Section seventy-five of this Code, such formula as it

deems adequate for determining the net asset value of

its holdings as a guide and basis for the issuance of

preferred shares. The shares of stock issued under the

authority of this provision shall be guaranteed a rate of

return of at least six per annum. In the event that the

earnings of the Bank for any single fiscal year are not

sufficient to enable the Bank, after making reasonable

allowance for administration, contingencies and growth,

to declare dividends at the guaranteed rate, the amount

equivalent to the difference between the Bank's earnings

available for dividends and that necessary to pay the

guaranteed rate shall be paid by the Bank out of its own

assets but the government shall, on the same day that

the Bank make such payment, reimburse the latter in full,

for which purpose such amounts as may be necessary to

enable the Government to make such reimbursements

are

hereby

appropriated out of any moneys in the

National Treasury not otherwise appropriated. The Bank

shall give sufficient notice to the Budget Commissioner

and the Secretary of Finance in the event that it is not

able to pay the guaranteed rate of return on any fiscal

period. The guaranteed rate of return on these shares

shall not preclude the holders thereof from participating

at a percentage higher than six per centum should the

earnings of the Bank for the corresponding fiscal period

exceed the guaranteed rate of return. The Board of

Directors shall declare and distribute dividends within

three months after the close of each fiscal year at the

guaranteed rate unless a higher rate of return is justified

by

the

Bank's

earnings

after

making

reasonable

allowance for administration, contingencies and growth,

in which case, dividends shall be declared and distributed

at a higher rate. The capital gains derived from the sale or

transfer of such shares and all income derived therefrom

in

the

form

of

dividends shall be fully tax-exempt.

(Amending R.A. No. 3844 As Amended (Code of Agrarian

Reform), Presidential Decree No. 251, [July 21, 1973])

Section 77-A . The provisions of their respective charters

to the contrary notwithstanding, all government-owned

or

controlled

corporations,

including

government

financial institutions, are authorized to invest in preferred

shares of the Land Bank and/or accept those shares in

exchange for any of their assets or properties under such

terms and conditions as shall be agreed upon between

the corporations or institutions concerned and the Land

Bank. (Amendments to R.A. No. 3844 (Code of Agrarian

Reform), Presidential Decree No. 444, [May 4, 1974])

Section 78. Special Guaranty Fund - In the event that the

Bank shall be unable to pay the bonds, debentures and

other obligations issued by it, a fixed amount thereof

© Compiled By RGL

121 of 169