Union Bank to get P52.8-M extraordinary income due to SC ruling

The Aboitiz-controlled Union Bank of the Philippines will book some P52.8 million in extraordinary income this year as a result of the favorable Supreme Court ruling granting the bank the right to collect the amount from the Development Bank of the Philippines.

UBP first vice president and general counsel Fe Macalino informed the Philippine Stock Exchange that the SC upheld a 1984 decision by the Makati Regional Trial Court (RTC) but was appealed by the DBP to the Court of Appeals and then to the SC.

"The case took 17 years before Union Bank was finally awarded by the Supreme Court the right to collect from DBP such amount based on the obligation of Foodmaster Inc. which was directly assumed by DBP in favor of UBP," Macalino said.

Foodmaster’s original obligation was P17 million but has gone up to P52.8 million to date. Its debt was directly assumed by the DBP to UBP’s predecessor-in-interest as of July 17, 1978 but has not been paid since, forcing UBP to sue DBP.

"Now on its execution stage before the Regional Trial Court of Makati Branch 58, the Makati Court issued a writ of execution against DBP to satisfy the judgement award to Union Bank," Macalino added. – Conrado Diaz Jr.