Exec linked to Cojuangco takes control of UCPB again

ABS-CBN News

Posted at Nov 15 2011 10:52 PM | Updated as of Nov 16 2011 06:52 AM

MANILA, Philippines - Jeronimo Kilayko, a former head of government bank United Coconut Planters Bank (UCPB) who is closely linked to businessman Eduardo "Danding" Cojuangco, is back at the helm of the bank.

Kilayko was elected as the new president and CEO of UCPB by the bank's board of directors. He assumed the post effective Tuesday.

Kilayko replaced Ramon Sy, who resigned amid controversy over P30 billion losses the bank incurred in the last 11 years.

Kilayko is an old hand at UCPB, having served as chairman and CEO during the time of former President Joseph Estrada from 1998 to 2002.

Immediately after leaving UCPB, he became president of San Miguel Properties Inc., the real estate arm of Cojuangco-led conglomerate San Miguel Corp.

Kilayko's new appointment, reportedly backed by Malacañang, has raised concerns among coconut farmers, the sector UCPB is supposed to serve.

During his previous stint as UCPB chief, Kilayko was accused of granting billions of pesos worth of loans to Cojuangco's companies.

Cojuangco is the uncle of President Benigno Aquino. He was a major financial supporter of Aquino's campaign in the 2010 national elections.

Back in martial law years, Cojuangco, a close associate of late dictator Ferdinand Marcos, purchased shares in San Miguel using money from UCPB, the depository bank of the coco levy fund. The coco levy was the tax imposed on copra sold by coconut farmers during the Marcos regime. Cojuangco was chairman of UCPB, director of the Philippine Coconut Authority and director of the main coconut industry conglomerate CIIF Oil Mills at the time of the San Miguel purchase.

Cojuangco battled with government over ownership of the San Miguel shares, which were sequestered along with other ill-gotten wealth of Marcos and his cronies after the Marcoses fell from power.

However, this year, the Supreme Court declared Cojuangco the legitimate owner of a 20% block of shares in San Miguel.

Another sequestered 24% stake in San Miguel is still being contested by coconut farmers today. In February 2010, the Supreme Court allowed the conversion of these shares from common to preferred shares, which have no voting rights.