CA reverses order allowing Bangko Sentral to sell Banco Filipino assets

MANILA, Philippines — The Court of Appeals (CA) has reversed its earlier ruling allowing the Bangko Sentral ng Pilipinas (BSP) to sell assets of the foreclosed Banco Filipino Savings and Mortgage Bank.

In a six-page resolution released earlier this week, the former 15th Division of the appellate court reconsidered and set aside its decision in November last year that lifted the writ of preliminary injunction (WPI) issued by a Makati court against the disposition of Banco Filipino’s seized assets after its closure in 2011.

The CA granted the appeal filed by Ekistics Philippines Inc., a stockholder of Banco Filipino, and reinstated the WPI issued by the Makati City regional trial court in 2016.

It agreed with Ekistics that the BSP should be enjoined from disposing of Banco Filipino’s assets until the question on the propriety of its closure and liquidation has been resolved with finality.

Citing judicial courtesy, the court explained that the validity of the BSP resolution, which placed Banco Filipino under receivership, is still pending appeal before the Supreme Court.

It further cited a pending case before another CA division involving the legality of the resolution, which ordered the liquidation of Banco Filipino.

“Based on these circumstances, it is not difficult to see that the implementation of our assailed decision might put to naught the appeal thus filed since it would effectively render a favorable resolution in these cases moot and academic,” read the ruling penned by Associate Justice Edwin Sorongon.

“It is significant to note that public respondent granted private respondent motion to suspend proceedings pending resolution of its appeal before the higher courts. This was the obtaining factual milieu when BSP posted its Invitation to Bid for sale of certain properties, which included those of Banco Filipino,” the CA explained.

“Certainly, we cannot countenance the said act of BSP as it not only interfered with but also undermined the exclusive jurisdiction of the liquidation court to adjudicate claims against Banco Filipino… Considering the aforesaid reasons, we deem that the most prudent course of action is to reverse our assailed decision in order not to render the proceedings before the SC and this court moot and academic,” it pointed out.

Associate Justices Ricardo Rosario and Maria Filomena Singh concurred with this ruling.

The Monetary Board of the BSP placed Banco Filipino under receivership of the Philippine Deposit Insurance Corp. (PDIC) in March 2011 and then ordered its liquidation in October 2011 after determining that it cannot continue its business without involving probable losses to its depositors and creditors.

But the Makati RTC suspended the bank’s liquidation proceedings upon the petition filed by some of its stockholders.

While the liquidation proceedings were suspended, BSP published in its website an invitation to bid for the sale of certain properties, which included those of Banco Filipino. Ekistics then sought relief from the courts to stop the sale of Banco Filipino’s assets.