Fitch Upgrades LANDBANK’s Viability Rating, Citing Stronger Financial Position

State-run Land Bank of the Philippines (LANDBANK) has received an upgraded Viability Rating (VR) from Fitch Ratings, rising from ‘bb’ to ‘bb+’, reflecting the Bank’s improved standalone financial strength. This upgrade highlights LANDBANK’s stronger capital buffers and enhanced profitability outlook.

Fitch also reaffirmed LANDBANK’s Long-Term Issuer Default Rating (IDR) at ‘BBB’/Stable and Government Support Rating (GSR) at ‘bbb’, emphasizing the Bank’s systemic importance, full state ownership, and continued strong government support.

Strengthened Financial Position

The upward revision of LANDBANK’s VR signifies its resilience in navigating external challenges while reinforcing its role as a key policy bank. The upgrade follows Fitch’s assessment of the Philippine banking sector’s operating environment, which was revised updward to ‘bbb-‘/stable from ‘bb+’/stable, a key factor in the Bank’s credit profile.

“This latest rating upgrade is a testament to LANDBANK’s sound financial foundation and resilience. With a solid capital base and an improving profitability outlook, we are well-positioned to drive stronger financial performance while deepening our commitment to agriculture and other key economic sectors that fuel national growth,” said LANDBANK President and CEO Lynette V. Ortiz.

Stronger Profitability and Capital Position

LANDBANK’s earnings and profitability assessment was also a step-up to ‘bb’/positive from ‘bb-’/stable, with Fitch citing expectations of improved core profitability as credit costs decline amid a resilient economy and falling interest rates.

The Bank’s capitalization is also projected to improve, supported by sustained organic growth. As of end-2024, LANDBANK reported a Common Equity Tier-1 (CET1) ratio of 15.1%, well above the Bangko Sentral ng Pilipinas’ minimum requirement of 10.25%, reflecting strong capital buffers that support its lending capacity.

Advancing Financial Resilience

As the country’s largest Government-Owned and Controlled Corporation (GOCC) and the biggest credit provider to the agriculture sector and its value chain, among other key economic sectors, LANDBANK remains committed to advancing financial inclusion and national development.

With its solid capital base and improving profitability outlook, LANDBANK continues to expand its financial services, sustain credit accessibility for key industries, and reinforce its crucial role in support of the National Government’s inclusive development agenda.