SOMETHING is wrong with the press releases issued by the Development Bank of the Philippines (DBP).
Probably, DBP officials are boasting of its role in nation building that it made known thru press releases its loans to two hospitals and a company, which is building a mini-hydro power plant. But in their rush to land in the news, they either forgot or intentionally omitted the outstanding capital of the borrowers and their owners or stockholders for reasons that would never be known.
Apparently, all this shows DBP based a corporate’s ability to pay on its paid-up capital. If this is right, then only the bankers would know.
Well, DBP’s 21 officials, including the members of the board, who received P63.407 million in 2012 in pays and perks, could, if they want to, justify the omissions by attributing them to lack of space.
If DBP is really being strict in going over the qualifications of corporate borrowers, its officials should have been transparent by including the outstanding capital of DBP borrowers in their press releases. Had they done this, taxpayers would be able to judge if their taxes end up financing under-capitalized companies that eventually make profits on their money.
Outstanding capital as used here should be computed based on par value and should not be bloated by the inclusion of additional paid-in capital, which represents the amount paid per share by stockholders in excess of par value. In this way, it would be easy for the public to draw their conclusion if DBP has not been selective in going by this policy in dealing with every borrower.
To illustrate: DBP lent P280 million to Global Medical Center of Laguna Inc. and P250 million to Pasig Medical Doctor Inc. Since both hospitals were still under construction when DBP issued the news in July, how certain is DBP of collecting the amortization on the loans?
To DBP officials, the terms of the loans did not matter at all in press releases to the public, particularly DBP depositors. Really? Doesn’t anybody care at all about the number of years government bank loans should be paid, and the interest rates it is charging the two companies that own the hospital? Has it been furnished projection on future profits of these borrowers to assure it of collection?
In the case of Global Medical Center, its stockholders expect residents of Cabuyao, Santa Rosa City and Calamba would patronize their hospital when they get sick or ill, and worse when they are about to die by which time their families are billed more for hospital services. What if they don’t, and instead avail themselves of the services of other hospitals?
Taxpayers would also be curious to know the numbers, and the people behind their computations, submitted by Global Medical Center and Pasig Medical Doctor that justify DBP’s P280-million and P250-million loan to them.
Perhaps, DBP officials would say since the bank is owned by the government, it is engaged in a mission to help the poor—via conduit—by financing “health care delivery services” provided by hospitals and won’t mind if financing hospitals, unfortunately, would be at the expense of people’s money and depositors.
If DBP lent to the two hospitals because of their missionary zeal, then it also granted Ormin Power Inc. P1.1 billion for the same reason. After all, a mini-hydro power plant would provide electricity to the population of San Teodoro, Oriental Mindoro, from which the company got its name.
Again, the disclosure via a press release suffered from omission. DBP officials did not tell the tax payers who are the stockholders of Ormin and their individual investments. Will they make public the list of the company’s owners?
In case Ormin’s stockholders are also companies, then DBP officials, who are all multimillionaires by the salaries they are getting every month, should make the proper disclosure of the ultimate stockholders. They should not hide the stockholders’ identities in layers and layers of corporate ownerships.
If Global Medical Center, Pasig Medical Doctor and Ormin are new companies, how come they deserve such huge loans from DBP? Please don’t tell Duediligencer, just tell the public.