The Philippine Export-Import Credit Agency (PhilEXIM) has cash on hand amounting to over P1.05 billion, and it has the ability to tap from international sources another $1.65 billion either as a borrower or as a guarantor.
PhilEXIM is a line agency of the Department of Finance (DOF) which is empowered to identify funding sources as well as guarantee the same. It was formerly known as the Trade and Investment Corporation of the Philippines (Tidcorp).
"We are the only shop in town that could provide a sovereign guarantee with a triple A credit rating," PhilEXIM president and chief executive officer Joel C.
Valdes said, "And that is our mandate. To lend and to guarantee."
The Bangko Sentral ng Pilipinas (BSP) issued Circular 280, which ranked PhilEXIM as zero risk weighted. That means the borrower need not have to worry about capital adequacy ratio (CAR) requirements. "It gave teeth to what we were marketing," Valdes pointed out.
He however admitted that there remains a lack of awareness in the part of the market of PhilEXIM financial muscle much less its ability to extend or find funds. When he took over the helm, PhilEXIM was not exactly in the pink of health albeit most of its debts were assumed by the national government.
"Because of the sins of the past, we had to address a lot of structural infirmities."
Other than the huge debts incurred over the years, the line agency of the Department of Finance (DOF) did not practice risk management, and it lacked systems and procedures to process loans and guarantees.
Thus, the new management had to put in place a reform-oriented business plan meaning a lot of restructuring, retooling and reengineering which entailed a lot of expenditures including automation.
At the start of 2002, the computer ratio was five persons per unit. By the end of the year, it rose to 2:1, and the plan for 2003 is a ratio of 1:1. Presently, its staff and personnel compliment stood at 140 and PhilEXIM is looking at expanding to 250 in the next four year. – TPT