Financial Assistance to Local Government Units

The Financial Assistance to Local Government Units (FALGU) was developed to finance the Local Government Units' (LGUs) local infrastructure and other socio-economic development projects in support to the government's thrust towards accelerating countryside economic growth and development.

PPSB shall finance the following projects:

  • Construction of public market / slaughterhouse, sports complex.
  • Purchase of heavy equipment.
  • Water system project such as improvements / expansion of the LGU Borrower's water distribution system.
  • Low cost housing project.
  • Health sector project including construction of public hospitals, barangay health / daycare centers and purchase of medical equipment.

Product Features

Loan Amount The maximum amount for loan availment shall not exceed the Single Borrower's Limit (SBL) of the Bank.
Loan term Up to a maximum term of 7 years.
Repayment terms Equal monthly amortization thru postdated checks.
Interest rate The interest rate shall be the Bank's prevailing rate at the time of availment subject to periodic repricing. If funded via Special Lending Program, the rates allowed under the program shall be followed, if any.


  • LGU with no past due obligations and adverse findings based on checkings to be conducted by the Bank.
  • LGU with satisfactory profitable track record of at least two (2) consecutive years per COA audited financial statement and not operating on a budgetary deficit for the past 3 years as certified by the Department of Finance.
  • The project must have approval of the Sangguniang Bayan / Panglunsod / Panlalawigan.


  • Assists the government especially LGUs in countryside development.

Documentary Requirements

  • Processing Requirements
    • An application for the loan in the form of a Sanggunian Bayan / Panglungsod / Panlalawigan Resolution which shall serve as the Formal application of the LGU-Borrower and to mortgage its assets and assign its IRA. The said Resolution must be signed by the members of the Sanggunian Bayan / Panglungsod / Panlalawigan (whichever is applicable) present at its adoption. Said Resolution must designate the person/s authorized to negotiate with PPSB regarding the loan. It shall indicate the authorized amount applied for and purpose of the loan among others.
    • Projects requiring construction: cost estimates, plan and specification, bill of materials, program of works and bar chart/s of the project approved.
    • For acquisition of machinery/ies and equipment: List of the machinery/ies/equipment to be purchased, its description/s and estimated cost/s based on official quotation/s.
    • COA audited financial statements for the past three (3) consecutive years.
    • Certificate of Borrowing and Debt Service Capacities from the Bureau of Local Government Finance of the Department of Finance.
    • Current annual budget.
    • Current Executive and Legislative Agenda.
  • Release Requirements
    • PPSB's standard documents as may be required.
    • Term Loan Agreement / Loan Line Agreement.
    • Deed of Assignment of IRA and other regular sources of income.
    • Deed of Assignment of deposits, if applicable.
    • Promissory note/s.
    • Disclosure Statement.
  • After Release Requirements
    • Certificate of acceptance of the project.
    • Certification from the LGU-Borrower's Treasurer and duly noted by the mayor acknowledging the loan and that the transaction shall be officially entered in the LGU-Borrower's books as contractual obligation to PPSB to ensure that the loan will still be honored by the succeeding administration in case of change in the LGU administration.