Sen. Bong Go has reintroduced Senate Bill 1182 or the proposed Government Financial Institutions Unified Initiatives to Distressed Enterprises for Economic Recovery Act to strengthen the capacity of government financial institutions to provide assistance to micro, small, and medium enterprises, and other strategically important companies.

"No Filipino should be left behind on the road to full and inclusive economic recovery," Go said in a statement.

He pointed out that providing timely and sufficient support to MSMEs and SICs is crucial to ensuring a strong economic recovery.

Many businesses in the country have been hit hard by the ongoing pandemic.

"Mas maraming negosyong makakabangon, mas maraming Pilipino ang mabibigyan ng trabaho at kabuhayan. Mas merong sapat na pagkain para sa pamilyang Pilipino at mas maraming mga bata ang makakapag-aral," Go noted.

To this end, the bill aims to strengthen the capacity of the Land Bank of the Philippines and the Development Bank of the Philippines to provide access to credit and financial assistance to distressed businesses, including MSMEs, SICs and other businesses affected by the pandemic.

Under the proposed measure, Land Bank and DBP are mandated to create a special holding company which shall assist in the rehabilitation of SICs heavily affected by the pandemic.

To ensure that the policies and objectives under the proposed bill are effectively carried out, Land Bank and DBP are further mandated to maintain at least a majority ownership over the special holding company, until such time that the businesses have recovered and the banks have recouped their investments.

The holding company shall be authorized to invest or place funds in equity, execute convertible loans, or purchase convertible bonds and/or other securities, in the SICs.

To ensure that such investments are properly utilized, as well as to ensure the successful rehabilitation of SICs, the measure imposes strict conditions on the investee company such as requiring that the number of employees are not reduced beyond a certain level, limiting its ability to declare dividends, restricting the increase in salary and other benefits of the board and its senior executive officers, and ensuring that investments of Land Bank and DBP are not diluted and time bound with a definite exit mechanism.