No write-off, no condonation: DBP officials belie claims Lopez firms have unpaid debt

ABS-CBN News

Posted at Feb 17 2021 08:57 PM

No write-off, no condonation: DBP officials belie claims Lopez firms have unpaid debt 1
The House of Representatives' Committee on Legislative Franchises and Good Government resume the hearing on ABS-CBN's franchise renewal on June 15, 2020. Mark Demayo, ABS-CBN News/File

MANILA - Companies under the Lopez Group and its former unit Maynilad Water Services have no unpaid loans with the state-run Development Bank of the Philippines (DBP), bank officials said Wednesday.

President Rodrigo Duterte earlier lashed out against Lopez-owned ABS-CBN Corp, saying he won't allow the network to resume broadcast operations until the company settles its obligations with the government.

But during Wednesday's hearing at the House of Representatives, a DBP official belied allegations that there was any write-off or condonation of the DBP loans of the Lopez-controlled companies.

Officials from Lopez Holdings and Maynilad also asserted that their companies had already settled their obligations with the financial institutions that bought DBP’s non-performing loans under the Special Purpose Vehicle Act (SPV). 

The SPV law was passed in the wake of the Asian Financial Crisis to enable banks to dispose of non-performing loans and assets, so that they could resume lending to businesses and consumers at pre-crisis levels.

Duterte has signed a similar law called Financial Institutions Strategic Transfer (FIST) Act meant to help lenders dispose of bad loans accumulated due to the COVID-19 crisis.

Lawmakers allied with the Duterte administration insisted during the House hearing that the Lopez firms had their debts to DBP written off, but bank officials belied this. 

“Sinasabi niya walang write off, walang condonation (He said there was no write off, no condonation?” Anak Kalusugan Rep. Mike Defensor asked Adiong, quoting DBP President Emmanuel Herbosa’s statement during an earlier hearing. 

“There was none, Sir,” replied DBP Chief Legal Counsel Soraya Adiong. 

Bank officials said that when its non-performing assets and loans, or so-called bad loans, were sold to other financial institutions, the buyer of the bad loans then became the lender. DBP said the bad loans were sold to Lehman Brothers.

ABS-CBN Corp subsidiary SKY Cable said it has paid its loans in full.

“The loans was paid by SKY Cable in full...Yes, it's been paid, in 2011, January 2011," said SKY Cable president Antonio Ventosa.

Maynilad, which was taken over by the Metro Pacific Group, has since also paid all its debts, its CEO Randolph Estrellado said.

"Bayad na ho lahat. In total ho, parang total $241 million ang binayaran namin... doon ho sa mga creditors na kasama sa rehab package," Estrellado said.

(Everything has been paid. I think we paid $241 million in total to creditors including the rehab package.)

Lopez Holdings president Salvador Tirona also refuted Presidential Spokesperson Harry Roque's claims that the group re-acquired some non-performing assets again.

Roque's claim could be a "misunderstanding" since the loans were sold to a SPV (Special Purpose Vehicle), Tirona said.

"After that, we negotiated with the SPV together with the other creditors of our different companies and settled our loans with the SPV and the other banks. There was really no repurchase by the Lopezes of what they termed as the assets. It’s a settlement of the loans with the new holder of the loans that came from DBP," Tirona said.

DBP has also said there was nothing irregular in the disposal of non-performing loans and non-performing assets by the companies under the Lopez group.

news.abs-cbn.com is the official news website of ABS-CBN Corp. 

-- with reports from RG Cruz, ABS-CBN News

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