Code of Agrarian Reforms

Section 74

To finance the acquisition by the Government of landed estates for division and resale to small landholders, as well as the purchase of the landholding by the agricultural lessee from the landowner, there is hereby established a body corporate to be known as the 'Land Bank of the Philippines', hereinafter called the 'Bank', which shall have its principal place of business in Manila. The legal existence of the Bank is extended for a period of fifty (50) years from the expiration of its original term on 08 August 2013, renewable for another fifty (50) years. The Bank shall be subject to such rules and regulations as the Bangko Sentral ng Pilipinas may from time to time promulgate. The Bank shall allocate five percent (5%) of its regular loan portfolio (net of loans to the Bangko Sentral ng Pilipinas, interbank loans and availments from domestic bills purchase line), for socialized credit to qualified small farmers, fisherfolk and agrarian reform beneficiaries (ARBs). This facility shall solely finance agricultural projects pursuant to the provisions of Section 4 of Republic Act No. 10000, otherwise known as 'The Agri-Agra Reform Credit Act of 2009'. Credits extended to the beneficiaries named therein under this facility shall be based on the feasibility of the project and their paying capacity, their estimated production, and/or securities they can provide as well as assets as may be acquired by them from the proceeds of the loan. This facility will be funded through the operations of the Bank itself and will not require additional government funding. All loans extended through this special socialized credit facility shall qualify as part of the Bank's compliance with the Agri-Agra Law. Credit under this special socialized credit facility shall be extended through the following conduits: (a) Farmers' and fisherfolk's cooperatives; (b) Farmers' and fisherfolk's organizations or associations; (c) Nonagricultural cooperatives (credit and multipurpose); (d) Cooperative banks; (e) Rural banks; (f) Thrift banks; (g) Agri-business firms or anchor firms providing credit support to ARBs, and small farmers and fisherfolk; and (h) Duly accredited microfinance nongovernment organizations by the Microfinance NGO Regulatory Council. Loans under this special socialized credit facility shall have an interest rate equivalent to not more than seventy-five percent (75%) of the Bank's prevailing rates for loans to cooperatives: Provided, That these conduits shall have an interest spread of not more than five (5) percentage points. The interest spread shall exclude crop insurance premiums and guarantee fees: Provided, further, That a conduit cannot lend to another conduit. Criteria for eligibility under this special socialized credit facility shall be determined by the Bank and shall be reflected in the implementing rules and regulations. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973], further amended by Republic Act No. 10374, [March 5, 2013], and Republic Act No. 10878, [July 17, 2016])

Section 75

The bank shall have the power. 1. To prescribe, repeal and alter its own by-laws to determine its operating policies, and to issue such rules and regulations as may be necessary; 2. To adopt, alter and use a corporate seal; 3. To hold, purchase, acquire and own real and personal property, introduce necessary improvements thereon to enhance and develop their social and economic values, and to sell, mortgage or otherwise dispose of the same; 4. To sue and be sued, make contracts, negotiate and secure loans from both local and foreign sources. Before undertaking any such credit operation, the Bank, through the Secretary of Finance, shall request the opinion, in writing, of the Monetary Board on the monetary implications of the contemplated action. All loans from foreign sources shall be subject to approval by the President of the Philippines and shall be fully guaranteed by the Philippine Government; 5. To grant short, medium and long term loans and advances against security of real estate and/or other acceptable assets for the establishment, development or expansion of agricultural, industrial, home building or home financing projects and other productive enterprises; 6. To grant loans to farmers' cooperatives/ associations to facilitate production, marketing of crops and acquisition of essential commodities; 7. To finance and/or guarantee the acquisition, under Presidential Decree No. 85 dated December 25, 1972, of farm lots transferred to tenant-farmers pursuant to Presidential Decree No. 27 dated October 21, 1972; 8. To underwrite, hold, own, purchase, acquire, sell, mortgage, dispose or otherwise invest or reinvest in stocks, bonds, debentures, securities and other evidences of indebtedness of other corporations and of the government or its instrumentalities which are issued for or in connection with any project or enterprise; 9. The provision of any law to the contrary notwithstanding, to guarantee acceptance(s), credits, loans, transactions or obligations of any person, co-partnership, association or corporation in favor of any financing or banking institution, whether foreign or domestic: Provided, That the proceeds of such 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

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

In the event that the Bank shall be unable to pay the bonds, debentures and other obligations issued by it, a fixed amount thereof shall be paid from a special guaranty fund to be set up by the Government, to guarantee the obligation of the Bank, and established in accordance with this Section and, thereupon, to the extent of the amounts so paid, the Government of the Republic of the Philippines shall succeed to all rights of the holders of such bonds, debentures or other obligations: Provided, however, That the Government shall pay into the guaranty fund the sum of five million pesos each year until the cumulative total of such guaranty fund is no less than twenty per cent of the outstanding net obligation of the Bank at the end of any calendar year. The special guaranty fund shall be administered by the Central Bank of the Philippines in the manner most consistent with its charter. For the purpose of such funds, the sum of five million pesos is hereby appropriated annually out of any moneys in the National Treasury not otherwise appropriated, until the total amount of one hundred million pesos shall have been attained therefrom. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973]) Apart from the foregoing which pertains to the twenty-five years bonds previously issued by the bank and pursuant to its role as the financial intermediary of the Comprehensive Agrarian Reform Program, mandated under Republic Act No. 6657, the National Government through the Presidential Agrarian Reform Council (PARC), shall provide and/or allocate from the existing Agrarian Reform Fund or other unappropriated funds of the National Treasury an amount sufficient to pay all maturing bonds, debentures and all other obligations together with interest due thereon issued and/or incurred by the bank as compensation to the landowners including expenses related thereto. In the apportionment and distribution of funds from the Agrarian Reform Fund, the PARC shall give priority and preference to the payment of landowner compensation in the chronological sequence or order at which the voluntary offers of sale were made by the landowners. (Amendment to R.A. No. 3844 (Code of Agrarian Reform in the Philippines), Republic Act No. 7907, [February 23, 1995])

Section 79

The Bank, subject to the provisions of the General Banking Act, as amended, is authorized to receive demand, savings and time deposits. The Secretary of Finance, the National Treasurer and his authorized representatives, city and municipal treasurers as well as custodians of funds or those belonging to government-owned or controlled corporations, may be authorized by the Monetary Board to make and actually maintain deposits of any government or corporate funds with the Land Bank.

Section 79-A

All agricultural guarantee funds shall be converted into a trust fund to be administered by the Bank. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 80

The Bank shall finance the acquisition of farm lots under any of the following modes of settlement: 1. Cash payment of 10% and balance in 25-year tax-free 6% Land Bank bonds; 2. Payment of 30% in preferred shares of stock issued by the Bank and balance in 25-year tax-free 6% Land Bank bonds; 3. Full guarantee on the payment of the fifteen (15) equal annual amortizations to be made by the tenant/farmer; 4. Payment through the establishment of annuities or pensions with insurance; 5. Exchange arrangement for government stocks in government-owned or controlled corporations or private corporations where the government has holdings; 6. Such other modes of settlement as may be further adopted by the Board of Directors and approved by the President of the Philippines. 7. At least sixty percent (60%) of the proceeds of the sale of the stocks, securities and other assets of the government now under administration by the Assets Privatization Trust (APT) shall be transferred to the Land Bank of the Philippines for use in the payment of agricultural lands acquired pursuant to Presidential Decree No. 27 and Republic Act No. 6657. (Amendment to R.A. No. 3844 (Code of Agrarian Reform in the Philippines), Republic Act No. 7907, [February 23, 1995]) In the event there is existing lien or encumbrance on the land in favor of any Government lending institution at the time of acquisition by the Bank, the landowner shall be paid the net value of the land (i.e., the value of the land determined under Proclamation No. 27 minus the outstanding balance/s of the obligation/s secured by the lien/s or encumbrance/s), and the outstanding balance/s of the obligations to the lending institution/s shall be paid by the Land Bank in Land Bank bonds or other securities; existing charters of those institutions to the contrary notwithstanding. A similar settlement may be negotiated by the Land Bank in the case of obligations secured by liens or encumbrances in favor of private parties or institutions. Whenever the Bank pays the whole or a portion of the total cost of farm lots, the Bank shall be subrogated by reason thereof, to the right of the landowner to collect and receive the yearly amortizations on farm lots or the amount paid including interest thereon, from tenant/farmers in whose favor said farm lots had been transferred pursuant to Presidential Decree No. 27, dated October 21, 1972. The profits accruing from payment shall be exempt from tax on capital gains.(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 81

The authorized capital stock of the Bank shall be nine billion pesos, divided into seven hundred and eighty million common shares with a par value of ten pesos each, which shall be fully subscribed by the Government, and one hundred and twenty million preferred shares with a par value of ten pesos each, which shall be issued in accordance with the provisions of Sections seventy-seven and eighty-three of this Code. These preferred shares shall be non-voting. The Board, upon the recommendation of the Secretary of Finance and with the approval of the President of the Philippines, may increase the capitalization of the Bank up to such an amount as may be necessary to attain the objectives of this Act. The total capital stock subscribed by the Government shall be paid by the Agrarian Reform Fund Commission created under Presidential Decree No. 85, hereinafter referred to as the "Commission," as follows: four hundred million pesos within sixty (60) days from the approval of this Decree, and at least one hundred million pesos every year thereafter until the total subscription of the Government is fully paid: Provided, That the common and preferred shares of the Bank which have been issued, including those already subscribed, shall form part of the increased capitalization of the Bank: Provided, further, That the additional common shares subscribed by the Government shall be paid by the bank through its banking operations in an amount equivalent to at least ten percent (10%) of its annual net income or any form of retained earnings until fully paid: Provided, finally, That the dividends due the Government shall first be paid. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973], further amended by Republic Act No. 7907, [February 23, 1995])

Section 82

All shares of stock in the Bank subscribed or owned by the government shall not be entitled to participate in the income earned by the Bank from its investment and other operations, whether in the form of cash or stock dividends or otherwise. Amounts expended for the administration of the Bank shall not be deemed as a participation of the government in income: Provided, That the Bank may declare all its earnings accumulated prior to the issuance of preferred shares as stock dividends to the government as the sole shareholder of the Bank or in lieu of dividends, set aside said earnings as contributed surplus to serve as fund for the guaranteed dividend to preferred shareholders. The manner of distributing the surplus shall be determined by the Board of Directors. (Amendments to R.A. No. 3844 (Code of Agrarian Reform), Presidential Decree No. 444, [May 4, 1974])

Section 83

All preferred shares or stock issued under Section seventy-seven of this Code shall be entitled to the income earned by the Bank on its investments and other operations: Provided, That the holders of such preferred shares of stock shall not bring derivative suits against the Bank. Such preferred shares shall be fully transferable: Provided, further, That upon the liquidation of the Bank, the redemption of such preferred shares shall be given priority. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 84

The voting power of all the common shares of stock of the Bank owned and controlled by the Government shall be vested in the President of the Philippines or in any ex-officio member of the Board of Directors of the Bank as he may designate. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 85

The bonds issued by the Bank may be used by the holder thereof and shall be accepted for any of the following: 1. Payment for agricultural lands or other real properties purchased from the Government. 2. Payment for the purchase of shares of stock or assets or government-owned or controlled corporations. Upon offer by the bondholders, the corporation owned or controlled by the Government shall, through its Board of Directors, negotiate with such bondholder with respect to the price and other terms and conditions of the sale. In case there are various bondholders making the offer, the one willing to purchase under terms and conditions most favorable to the corporation shall be preferred. If no price is acceptable to the corporation, the same shall be determined by the Committee of Appraisers composed of three members, one to be appointed by the corporation, another by the bondholder making the highest or only offer, and the third by the two members, so chosen. The expense of appraisal shall be borne equally by the corporation and the successful purchaser. Should the Government offer for sale to the public any or all the shares of stock or the assets of any of the Government-owned or controlled corporations, the bidder who offers to pay in bonds of the Land Bank shall be preferred, provided that the various bids be equal in every respect except in the medium of payment. 3. Surety, bail bonds for the provisional release of accused person or performance bonds in all cases where the Government may require or accept real property as bonds. 4. Security for loans applied with the Philippine National Bank, Development Bank of the Philippines, Government Service Insurance System, Social Security System, and other government financial institutions, existing charters of these institutions to the contrary notwithstanding. 5. Payment for reparations goods the provisions of Republic Act Nos. 1789 as amended, to the contrary notwithstanding. (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 86

The affairs and business of the Bank shall be directed and its property managed and preserved by a Board of Directors consisting of nine (9) members to be composed of the Secretary of Finance, as Chairman, the President of the Bank as Vice-Chairman, the Secretary of Agrarian Reform, the Secretary of Labor, and the Secretary of Agriculture as ex officio members. The President of the Philippines shall appoint two (2) members of the Board who shall represent the agrarian reform beneficiaries and two (2) members who shall represent the private sector. The two (2) remaining members shall be elected from the shareholders coming from the public sector to the extent that they may be entitled to two (2) seats in proportion to the outstanding capital stock. Annually, on the first Tuesday after the first Monday in December, the stockholders shall meet to take up, among others, the election of two (2) members of the Board of Directors for the succeeding year. Each shareholder or proxy shall be entitled to as many votes as he may have shares of stock registered in his name of the 31st day of October last preceding and held by him at the time of the election. The two (2) members of the Board of Directors shall be elected preferably from the holders of the preferred shares on the basis of the outstanding amount of shares as follows: (a) Not exceeding P100.0 M — one member (b) Exceeding P100.0 M — two members The appointive members of the Board shall hold a term of office for one (1) year and shall continue to hold office until their successor shall have been appointed and qualified. The Board shall convene as often as necessary to discharge its responsibilities properly, but shall meet at least once every two (2) weeks. The Board may be convoked either by the Chairman or in his absence, the Vice-Chairman. The majority of the board members shall constitute a quorum. All decisions of the Board shall require the concurrence of at least a majority. No person shall be elected or appointed director of the Bank unless he is natural born citizen of the Philippines, not less than thirty-five (35) years of age, of good moral character, and has attained proficiency, expertise and recognized competence in one or more of the following: banking, finance, economics, law, agriculture, agrarian reform, business management: Provided, further, That no director, shareholder or employee of any other bank shall be eligible for election or appointment as member of the Board of Directors of the Bank. The Chairman and the members of the Board shall receive a per diem of One thousand five hundred pesos (P1,500) for each session of the Board attended but in no case not to exceed Seven thousand five hundred pesos (P7,500) a month. (Amendments to R.A. No. 3844 (Code of Agrarian Reform), Presidential Decree No. 444, [May 4, 1974], further amended by Presidential Decree No. 1039, [October 21, 1976], and Republic Act No. 7907, [February 23, 1995])

Section 86-A

The Board of Directors shall have, among others, the following specific powers and responsibilities: 1. Formulate policies, rules and regulations for the effective operation of the Bank; 2. Take decisions concerning loans as well as fix the rates of interest thereon, guarantees, investments, borrowing by the Bank, furnishing of technical assistance and other operations of the Bank; 3. Establish such branches and agencies as may be deemed necessary and convenient; 4. Provide for the appointment and removal and fix the reasonable compensation of such personnel as may be necessary for the expeditious conduct of the business of the Bank; and 5. Approve the budget of the Bank. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973]) 6. To compromise or release, in whole or in part, any claim or liability whatsoever for or against the bank, including interest, penalties, fees and/or other charges, under such terms and conditions as the board may find acceptable and practicable subject to their best business judgment and to the best interest of the corporation in accord with standard banking practices. (Amendment to R.A. No. 3844 (Code of Agrarian Reform in the Philippines), Republic Act No. 7907, [February 23, 1995])

Section 87

The Chief Executive of the Bank shall be the President, who shall be chosen and may be removed by the Board of Directors with the advice and consent of the President of the Philippines. His salary shall be fixed by the Board of Directors with the approval of the President of the Philippines. The President shall be assisted by Vice-Presidents as may be required, whose appointments and removal shall be approved and whose salaries shall be fixed in accordance with Section 90 hereof by the Board of Directors upon recommendation of the President of the Bank. (Amendment to R.A. No. 3844 (Code of Agrarian Reform in the Philippines), Republic Act No. 7907, [February 23, 1995])

Section 87-A

The President of the Bank shall, among others, execute the policies, measures, orders and resolutions promulgated by the Board of Directors and supervise and administer the operation of the Bank. He shall be the legal representative of the Bank and shall make all contracts, enter into all necessary obligations on behalf of the bank required or permitted by this Decree. He shall report periodically to the Board of Directors the main facts concerning the operations of the Bank, and recommend changes of policies which may to him seem best. He shall furnish, upon request of the President of the Philippines, any information in his possession regarding the operations of the bank. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 88

No person shall be appointed to any executive position in the Bank mentioned in the preceding section unless he be of good moral character and of unquestionable integrity and responsibility, and who is of recognized competence in the field of economics, agriculture, industry, law, banking and/or finance, and possessed of demonstrated administrative skill and ability. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973], further amended by Republic Act No. 7907, [February 23, 1995])

Section 89

Whenever any member attending a meeting of the Board has a personal interest of any sort in the discussion or resolution of any given matter, or any of his relatives within the fourth degree of consanguinity or second degree of affinity has such an interest, shall not participate in the discussion or resolution of the matter and must retire from the meeting during the deliberations thereon. The subject matter, when resolved, and the fact available to the public. The minutes of the meeting shall note the withdrawal of the member concerned. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 90

The Board of Directors shall provide for an organization and staff of officers and employees of the Bank and upon recommendation of the President of the Bank, appoint and fix their remunerations and other emoluments, and remove such officers and employees: Provided, That the Board shall have exclusive and final authority to promote, transfer, assign or reassign personnel of the Bank, any provisions of existing law to the contrary notwithstanding. All positions in the Bank shall be governed by a compensation, position classification system and qualification standards approved by the Bank's Board of Directors based on a comprehensive job analysis and audit of actual duties and responsibilities. The compensation plan shall be comparable with the prevailing compensation plans in the private sector and shall be subject to periodic review by the Board no more than once every two (2) years without prejudice to yearly merit reviews or increases based on productivity and profitability. The Bank shall therefore be exempt from existing laws, rules and regulations on compensation, position classification and qualification standards. It shall however endeavor to make its system conform as closely as possible with the principles under Republic Act No. 6758. The Bank officers and employees, including all members of the Board, shall not engage directly or indirectly in partisan activities or take part in any election except to vote. No officer or employee of the Bank subject to the Civil Service Law and Regulations shall be removed or suspended except for cause as provided by law. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973], further amended by Republic Act No. 7907, [February 23, 1995])

Section 91

Any provision of existing law or executive order to the contrary notwithstanding, the Bank shall have its own Legal Department, the chief and members of which shall be appointed by the Board of Directors. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 92

The Chairman of the Commission on Audit shall act as the ex-officio Auditor of the Bank and, as such, he is empowered and authorized to appoint a representative who shall be the auditor in charge of the auditing office of the Bank and, in accordance with law, fix his salary, and to appoint and fix the salaries and number of personnel to assist said representative in his work, but in all cases subject to the approval of the Board of Directors. The salaries and all other expenses of maintaining the auditor's office shall be paid by the Bank. The Auditor of the Bank and personnel under him may be removed only by the Commission on Audit. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 93

The representative of the Commission on Audit shall make a quarterly report on the condition of the Bank to the President of the Philippines, to the Secretary of Finance, to the Chairman of the Commission on Audit, and to the Board of Directors of the Bank. The report shall contain, among other things, a statement of the resources and liabilities, including earnings and expenses, the amount of capital stock, surplus, reserve and profits, as well as losses, bad debts, and suspended and overdue paper carried in the books and assets of the Bank. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 94

The Auditor General shall, with respect to the Bank, formulate improved and progressive auditing rules and regulations designed to expedite the operations of the Bank and prevent the occurrence of delays and bottlenecks in its work.

Section 95

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

Section 96

The assets of the former Land Tenure Administration and the National Resettlement and Rehabilitation Administration in the form of claims and receivables arising from the sale or transfer of private and public lands, agricultural equipment, machinery, tools and work animals, but excluding advances made for subsistence, to small landholders shall, after an exhaustive evaluation to determine their true asset value, be irrevocably transferred to the Bank under such arrangements as the Department of Agrarian Reform and the Bank shall agree upon. Thereafter, the Bank shall have authority and jurisdiction to administer the claims, to collect and make adjustments on the same and, generally, to do all other acts properly pertaining to the administration of claims held by a financial institution. The Department of Agrarian Reform, upon request of the Bank, shall assist the latter in the collection of such claims. The Department of Agrarian Reform shall be entitled to collect from the Bank no more than the actual cost of such collection services as it may extend. The claims transferred under this Section shall not be considered as part of the Government's subscription to the capital of the Bank.

Section 97

The Bank shall be under the supervision and regulation of the Central Bank of the Philippines. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 98

The Land Bank shall be exempt from all national, provincial, municipal, and city taxes and assessment now enforced or hereinafter established. The exemption authorized in the preceding paragraph of this section shall apply to all property of the Bank, to the resources, receipts, expenditures, profits and income of the Bank, as well as to all contracts, deeds, documents and transactions related to the conduct of the business of the Bank, Provided, That said exemptions shall apply only to such taxes and assessments payable by persons or other entities doing business with the Bank. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 99

The Bank shall be reorganized within ninety (90) days from the date this Decree take effect. The present personnel complement of the Bank shall in the interim continue to discharge their respective functions. Officials and personnel whose services may be dispensed with as a result of this reorganization shall be paid the usual gratuities to which they may be entitled under existing law. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 100

Any director, officer, employee or agent of the Bank who violates or permits the violation of any of the provisions of this Chapter or any person aiding or abetting the violation of any of the provisions of this Chapter, shall be punished by a fine of not to exceed ten thousand pesos or by imprisonment of not more than five years, or both, such fine and imprisonment at the discretion of the Court. (Amending R.A. No. 3844 As Amended (Code of Agrarian Reform), Presidential Decree No. 251, [July 21, 1973])

Section 86-B

Foreclosure Of Collaterals And Disposal Of Bank Acquired Properties — 1. Foreclosure of Mortgage Collaterals — Foreclosure of mortgage collaterals to loans may be made either judicially or extrajudicially. 2. Deputization of Legal Staff — The bank may, with the approval of the court, deputize any member of its legal staff to act as special sheriff in foreclosure cases, in the sale or attachment of debtor's properties and in the enforcement of court writs and processes in cases involving the bank. The special Sheriff of the bank shall make a report to the proper court after any action has been taken by him, which court shall treat such actions as if it were an act of its own sheriffs in all respect. 3. Disposal of Real Estate and Other Properties in the Collection of Debt — Real estate and other properties acquired by the bank in the collection of debts or investment by way of foreclosure or other means shall be sold or disposed of in accordance with law, within five (5) years after date of acquisition. The sale or disposal shall be effected through public bidding, in accordance with law. 4. Exemption from Attachment — The provisions of any law to the contrary notwithstanding, securities on loans and/or other credit accommodations granted by the bank shall not be subject to attachment, execution to any other court process, nor shall they be included in the property of insolvent persons or institutions, unless all debts and obligations of the debtors to the bank have been paid, including accrued interest, penalties, collection expenses, and other charges. 5. Right of Redemption of Foreclosed Property; Right of Possession during Redemption Period — Within one (1) year from the registration of the foreclosure sale of real estate, the mortgagor shall have the right to redeem the property by paying all claims of the bank against him on the date of the sale including all the cost and other expenses incurred by reason of the foreclosure sale and custody of the property, as well as charges and accrued interest. That bank may take possession of the foreclosed property during the redemption period. The bank shall be eligible to post a bond for the purpose of such possession. (Amendment to R.A. No. 3844 (Code of Agrarian Reform in the Philippines), Republic Act No. 7907, [February 23, 1995])