The state-owned Home Guaranty Corp. (HGC) announced on Thursday that it has remitted P86 million cash dividends to the national government.
In a press statement, HGC said it has remitted the cash dividends through the Bureau of the Treasury after overcoming the financial difficulties it encountered in the past.
“This is a milestone for the shelter agency, which suffered financial setbacks in the early 2000s as a consequence of providing guaranty coverage to the various projects of the national government in the early ‘90s,” the HGC said.
Among these projects were: the Smokey Mountain Development and Reclamation Project; Sariling Pabahay sa Riles; Subic Bay APEC Project; Commonwealth Enterprise Zone Project; and the Bilibid Viejo Urban Renewal Project.
HGC said most of these projects had liquidity problems in the late ‘90s, which resulted in the housing agency not having enough funds to service all obligations to the investors.
To raise funds, the previous HGC Board of Directors approved the flotation of zero-coupon bonds.
In 2011, HGC was able to settle its P3 billion zero-coupon bonds from its creditors.
In 2013, it was relieved from paying its annual P1 billion financial charges, as it was able to settle its maturing P12 billion zeroes with the help of the national government.
The firm registered a net income of P173.48 million in 2014 and projects to have even higher net income in the coming years, as it was able to settle its huge debt.
“Having settled its huge debt and with a better, more robust guaranty business, HGC projects higher net income in 2015 and onwards,” the agency’s statement said. “This follows that HGC will be giving back more to the national treasury next year and in the years to come.”