Home Guaranty Corp., a government-owned corporation, is set to borrow P10 billion from the debt market this year, its top official yesterday said.
“Our borrowing program for the year is P10 billion. It’s mainly for our refinancing debts,” HGC president Gonzalo Benjamin Bongolan told reporters yesterday.
He said the funds that would be raised would be used mainly for the refinan-cing needs of the agency.
HGC is still waiting for advice from the Department of Finance (DOF) on when it could tap the debt market as well as the final debt instrument that it would issue.
“We will likely do it in the second quarter of the year,” Bongolan said.
Bongolan is optimistic that the agency would continue to improve operations this year on the back of prudent strategies and continuous disposal of assets.
Home Guaranty is a government-owned and controlled corporation mandated by law to extend guarantee cover to all bond issuances of other state-run firms. Through the years, the company has acquired various properties including residential villas at the Triboa Bay in Subic Freeport Zone in Olongapo City and 42 units in Forest Hills Village Resort, also in Subic.
Last year, HGC sold P1.17 billion in assets comprising of real estate and other properties acquired by the agency from borrowers who failed to pay their dues to banks.
For this year, HGC expects to raise P900 million in revenues, mainly from its guarantee fees, income from asset sale and income generated from its investments in the fixed-income instruments.
Last year, the agency raised P414 million in guarantee fees, up from P374 million recorded in 2006. HGC charges its clients a guarantee fee ranging from 0.5 to P1.5 percent of the guaranteed amount.
Total guarantees of HGC last year stood at P64 billion, higher than the P63 billion recorded in 2006.