By LEE C. CHIPONGIAN
March 4, 2011, 12:12am
MANILA, Philippines – Government financial institution Land Bank of the Philippines is expected to borrow up to $1.3 billion this year for relending to various clients, a document from the central bank said.
Based on pending applications and approvals-in-principles, the Bangko Sentral ng Pilipinas (BSP) estimates that the public sector which includes the GFIs will take out $10.4 billion of total foreign loans this year, either through the sale of bonds or direct loans.
LandBank President and CEO Gilda E. Pico yesterday said through text that the bank has no active applications for bond issuances or loans yet.
One of the bank’s biggest clients this year is the Power Sector Assets and Liabilities Management Corp. (PSALM) which it was preparing a P25-billion short-term loan line to fund budget and loan payment requirements.
Central bank sources said PSALM is looking at a financial deficit of P74 billion this year since there will be no big-ticket privatization of assets lined up in the next months to raise funds. A bulk of the deficit is expected to materialize in the first quarter, including a $200 million or P8.7 billion debt maturing this month.
In the meantime the BSP has already approved-in-principle LandBank’s planned issue of up to $250 million of hybrid tier1 capital global certificates.
The issuance was approved before the BSP capped the banks’ hybrid tier1 and tier2 issuance as foreign borrowings and subject to foreign loan ceilings last November.
LandBank had originally plan to issue the notes – for loan payments and capital – in 2009 but the bank shied away from the bonds market due to high rates and also because there was no urgent need to raise the capital.
Last year the bank, the country’s fourth biggest, earned total income of P8.1 billion, up 20 percent over 2009 results, and exceeding the 2010 target of P7.2 billion.
The higher profitability pushed its Return on Equity or ROE to a high 15 percent at the end of December while its capital adequacy ratio also remained on the high side above 17 percent indicating the bank’s capability to withstand risks.
--
---------------------------------------------
CARLOS ANI - SEEDFINANCE Corporation - http://www.seedfinance.net
Email: carlosani@seedfinance.net
Landline: +63495010127 Cellphone: +639152919580
DEVJOBS - http://www.devjobsmail.com
PHILDEVFINANCE - http://phildevfinance.posterous.com http://phildevfinance.wordpress.com
CONSULTING - http://www.carlosani.com
My Clippings - http://www.myclipps.posterous.com
------------------------------------------
---------------------------------------------
CARLOS ANI - SEEDFINANCE Corporation - http://www.seedfinance.net
Email: carlosani@seedfinance.net
Landline: +63495010127 Cellphone: +639152919580
DEVJOBS - http://www.devjobsmail.com
PHILDEVFINANCE - http://phildevfinance.posterous.com http://phildevfinance.wordpress.com
CONSULTING - http://www.carlosani.com
My Clippings - http://www.myclipps.posterous.com
------------------------------------------
