Senators grill UCPB head over P30-B loss

Senate President Juan Ponce Enrile and Sen. Ralph Recto on Tuesday grilled the head of the United Coconut Planters Bank (UCPB) for the bank's losses in 11 consecutive years amounting to about P30 billion. "The bank was run to the ground," said Recto during the joint hearing of the Senate committees on government corporations and public enterprises, and on agriculture and food. UCPB president and CEO Ramon Sy revealed that from 1998 to 2008, their bank suffered successive losses worth P30 billion due to bad loans and the 1997 financial crisis. Enrile was incredulous over the amount involved. "How come that UCPB, which was first to become a universal bank before the EDSA Revolution, was not able to anticipate the problems whereas other banks in the Philippines succeeded in retaining their position?" he said. Sy said other banks were able to recapitalize because, unlike UCPB, their stockholders were known personalities and businessmen. He said there are around 1,400,000 coconut farmers who are minor stockholders in UCPB, and that he does not know how many of these farmers are still alive. Enrile said the farmers should have been consulted about the bank's transactions. The UCPB was bought by businessman Eduardo "Danding" Cojuangco and other Marcos-era officials using coco levy funds, a tax exacted from coconut farmers from 1973 to 1982. The Philippine Deposit Insurance Corporation said they have "pumped in" around P20 billion to UCPB to help it recover from its losses. Sy said that by the end of the second year of his term in UCPB, the bank supposedly reversed its losses and ended up with a net operating profit of P604 million, followed by a net operating profit of P1.53 billion in 2010. CIIF The revelations about UCPB were made during the Senate panel's second hearing on the chamber's inquiry on the P1.5-billion net operating loss incurred by the sequestered Coconut Industry Investment Fund Oil Mills Group (CIIF-OMG) from 2005 to 2007. The CIIF-OMG is a conglomerate composed of the Legaspi Oil Company Inc., San Pablo Manufacturing Corporation, Cagayan de Oro Oil Co. Inc., Southern Luzon Coconut Oil Mill Inc., Granexport Manufacturing Corp. and lIigan Coconut Industries, Inc. The companies were acquired using a portion of the Coconut Industry Development Fund Levy (CIDF), which is supposed to finance various coconut planting and replanting programs, coconut research and extension services programs, establishment of model plantations, and acquisition of coconut-related industries for the benefit of coconut farmers and the coconut industry in general. The CIIF-OMG companies and its subsidiaries were sequestered by the PCGG on suspicion that it was part of the supposed ill-gotten wealth of Marcos and his cronies. - KBK, GMA News