Lucio Tan defends stand on PNB

The camp of taipan Lucio Tan defended yesterday their stand on the Bangko Sentral ng Pilipinas Monetary Board approving the rehabilitation program for Philippine National Bank (PNB) together with the infusion of P10 billion.

An officer of Starbuck Equities explained that Tan is not asking that the rehabilitation plan be approved first before he makes the capital infusion.

Rather, the official said, Tan is asking that the BSP approve the rehab plan "subject to the infusion of P10 billion." He said Tan merely wants to be assured that the rehab program is approved without new conditionalities being attached.

The official pointed out that the contrary to government’s claim that Tan is trying to change the terms of an earlier memorandum of agreement (MOA), it is the other way around.

The official said that if Tan puts in the P10 billion ahead of BSP approval, the government can still withhold approval of the rehabilitation plan by requiring Tan to make some other infusion or fulfill some new requirement.

The Starbuck official said Tan only wants to ensure that a rehab program is approved without any new surprises.

The official argued that the BSP has already checked that the P10 billion is available in Allied Bank even though it has not been transferred to PNB.

Tan was the sole bidder for government’s 30.4 percent stake in PNB. The sale of the 30.4 percent stake was supposed to have been concluded before a stock rights offering which would effectively dilute the government’s 30.4 percent stake if it does not exercise its rights.

The BSP is asking PNB to submit a five-year financial projection and program on how it plans to reduce its non-performing loan, with and without the P10 billion infusion.