Savings bank

Sun Savings Bank secures 200 million peso loan from DBP to help teachers rebuild their homes

PARTNERSHIP. Signing of the loan agreement between Sun Savings Bank and Development Bank of the Philippines (DBP) at Casino Español de Cebu in Cebu City on Thursday, March 24, 2022 are (seated from left to right) Augusto Gonzalez, Executive Vice President and Treasurer, Sun Savings Bank; Francisco Dizon, Chairman and CEO, Sun Savings Bank; Marissa Anino, Vice President, Head of Visayas Lending Group, DBP; and Dan Clever Gigantone, Senior Director and Head of Cebu South Lending Center, DBP. (Kenneth Dwight Torres)

SUN Savings Bank secured a loan facility of 200 million pula from the state-run Development Bank of the Philippines (DBP) to help public school teachers in Cebu province, mainly to rebuild their homes which have been hit hard by typhoon Odette (Rai) in December 2021.

“There is a huge demand now to repair their homes, and we want to support this effort because we believe teachers deserve decent housing… There are also other needs, such as school fees for their children and medical costs. But I would say 90% of their needs are for building, repairing and renovating housing,” said Francisco Dizon, President and CEO of Sun Savings, at the loan signing ceremony. between Sun Savings Bank and DBP on Thursday March 24, 2022.

Dizon said the Department of Education (DepEd) has mandated banks to provide loans to teachers for terms of up to five years from the previous three-year schedule.

“The implication of this is that teachers can borrow up to 750,000 to 800,000 pesos compared to 500,000 pesos before and still pay the same monthly amortization,” Dizon said. “In terms of cash flow, they can borrow more without having to put in more money on a monthly basis. This is made possible by the longer repayment terms of three to five years.

A teacher applying for a loan of 800,000 pesos would pay a monthly amortization of 15,000 pesos.

Last year, the government increased the salaries of public school teachers in accordance with Republic Act 11466 or the Salary Normalization Act of 2019. The increases are planned in four installments from the year 2020 to 2023 and will be by salary grade (SG) and step. corresponding to the position.

The salary of Teacher I (SG 11), for example, was increased to P22,316 in 2020, then to P23,877 in 2021. Their salary will be further increased to P25,439 in 2022 and then to P27,000 in 2023. .

Dizon says Sun Savings is at the forefront of this market segment and is offering teachers this extended loan term of up to five years starting this month.

“The demand has been super strong. If there’s a storm surge, then that’s it, when it comes to teacher loans,” Dizon said. “We’re unlocking levels that we’ve never seen before, really huge amounts of money just because they really need funds to fix their housing.”

Money borrowed by teachers will be deducted by the DepEd from their pay stubs through the department’s automatic payroll deduction system, where Sun Savings Bank has been one of the accredited banks for more than 10 years.

Augusto Gonzalez, treasurer of Sun Savings Bank, said the bank will pay DBP in three years, with interest on the loan to be paid quarterly and the principal loan amount to be paid at the end of the term.

Since March 1, Sun Savings has been able to lend to 2,000 teacher borrowers in the province of Cebu.

The bank counts about 10,000 of the province’s 40,000 teachers among its customers, making it the third largest lender to public school teachers in Cebu. (KOC)

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