PNB proposes loan swap with gov’t

The Philippine National Bank (PNB) wants to collect on some P800 million in loans which the government to finance its various public projects. Otherwise, the bank is asking government to write off an equivalent amount from its P25-billion emergency loan in some kind of an offsetting or loan swapping scheme.

Bank sources said PNB wants the government to pay for a P300-million loan used in the Smokey Mountain Rehabilitation project which was launched during the Ramos Administration.

The project was supposed to provide homes and livelihood for thousands of scavengers and their families who were dislocated when the Smokey Mountain dump site was shut down.

The lead proponent was RII Builders, a company owned by businessman Reghis Romero who figured in the controversial hostage-taking incident at Dos Palmas Resort.

According to the source, the PNB has already billed the Home Guarantee Corp. for the P300 million because it was the agency that issued a guarantee on the project.

The source said the bill was forwarded in March but PNB officials do not expect the government to pay up since this is likely to upset its P130-billion budget deficit target for the year.

According to the source, the PNB wants the government to either pay up or include all P800 million in the ongoing talks for the rehabilitation of the bank. – Des Ferriols