Questions are being raised over the governance structure of Land Bank of the Philippines as its chairpersons, typically the country’s finance secretaries, also sit on the Bangko Sentral ng Pilipinas’ (BSP) Monetary Board, which regulates the state-owned lender.
Under the New Central Bank Act, Monetary Board members, including the BSP governor, are barred from holding positions in banks under the central bank’s supervision. But Land Bank chairs — including current Finance Secretary Ralph Recto and former secretaries Benjamin Diokno and Carlos Dominguez — have concurrently held both posts.
The overlap has renewed scrutiny of potential conflicts of interest between the regulator and a regulated institution.
The BSP’s regulations mandate bank boards to uphold corporate governance, prevent misuse of facilities, and manage risks such as money laundering and fraud. They also require heightened monitoring of politically exposed persons and full transparency in decision-making.
The issue highlights challenges in maintaining clear separation between regulatory oversight and political appointments in state financial institutions.
