History
DBP's history can be traced back to the Commonwealth Era. In 1935, the National Loan and Investment Board (NLIB) was created to coordinate and manage various government trust funds such as the Postal Savings Fund and the Teacher's Retirement Fund.[9]
In 1939, the NLIB was abolished and its functions were transferred to a new body, the Agricultural and Industrial Bank (AIB).[10] AIB continued operations until the outbreak of World War II.
In 1947, the government created the Rehabilitation Finance Corporation (RFC) under Republic Act No. 85 which absorbed the assets and took over the functions of the AIB. The RFC provided credit facilities for the development of agriculture, commerce and industry and the reconstruction of properties damaged by the war.[11]
In 1958, the RFC was reorganized into the modern-day DBP. The change in corporate name marked the shift from rehabilitation to broader activities.[12]
With an initial capital of ₱500-million, DBP set to work on expanding its facilities and operations to accelerate efforts towards promoting national economic development. The bank established a nationwide branch network and tapped local and foreign resources to complement its capital. It also borrowed money directly from international finance institutions.
In the late 1970s up to the early 1980s, however, its viability was undermined by numerous non-performing accounts.
In 1986, President Corazon Aquino issued Executive Order No. 81, which reorganized the bank and gave it a new charter.[13] All non-performing assets and liabilities were subsequently transferred to the government. DBP undertook an institutional strengthening program, including a thorough revision of its credit process, as well as employee training programs towards the intensive implementation of its new lending thrusts. DBP likewise reopened its lending windows for housing, agriculture and SMEs.
In 1995, DBP was granted an expanded banking license and attained universal banking status.
President Fidel Ramos signed Republic Act No. 8523 in 1998, amending DBP's 1986 charter. Among the major provisions incorporated in the new DBP charter were the increase of authorized capital stock from ₱5-billion to ₱35-billion, and the creation of the position of President and CEO.[14]
In February 2016, President Benigno Aquino III approved the merger of DBP with state-owned Land Bank of the Philippines, pending approval from the Bangko Sentral ng Pilipinas (BSP) and written consent of the Philippine Deposit Insurance Corporation. A few months later in September under the administration of newly-elected Rodrigo Duterte, such had been cancelled for implementation by the Governance Commission for GOCCs (GCG).[15] By 2023, two presidents later under the administration of Ferdinand "Bongbong" Marcos Jr., the idea of such merger is again on the cards, with target completion around middle of 2024.[16] However, as of early October 2023, the BSP says that they still haven't formally received an application for the merger.[17] Finance Secretary Ralph Recto later announced in February 2024 that the proposed DBP-Landbank merger is no longer pursued.[18]
