Ex-DBP chief denies knowing Philex shares prices about to surge

Former Development Bank of the Philippines (DBP) president and CEO Reynaldo David denied he had prior knowledge that the price of Philex Mining Corp. shares under the name of the state-owned bank would surge after the stocks were sold to another company. "I did not know that. I would not know that," David told senators Friday's during a Senate blue ribbon hearing on the alleged behest loans the bank extended to another company. David, who was the DBP president and CEO from 2004 to 2010, issued a statement after Senate President Juan Ponce Enrile asked him how he could not have known that the stock value of Philex would shoot up when he was a member of its board. Another Philex director at that time was businessman and former Trade Minister Roberto Ongpin, whose company bought the shares and then sold them at a higher price to mogul Manuel V. Pangilinan. Pangilinan was also a member of the Philex board of directors. "Are you saying Ongpin is smarter than you?" Enrile asked. "Of course, he is older than me," David replied. In 2009, the DBP released P660 million in loans to Delta Venture Resources Inc. (DVRI) to buy DBP's 50 million Philex shares at P12.75 apiece. The shares were registered to Golden Media, Ongpin’s company which later sold the Philex shares at P21 per share to the firm Two Rivers which was affiliated with Pangilinan. Opportunity for DBP Sen. Sergio Osmeña III, chair of the Senate banks committee, asked whether not those involved in the transaction expressed any concern that the DBP might miss the opportunity to gain a higher return from those Philex shares. "That's a potential earning of another P412 million," Osmeña said at the same hearing. The transaction was given the green light because the market price of those shares was “"being driven by a lot of speculation," David said, noting that at P12.75 the DBP profited from the deal. "We didn't want to take anymore speculative risk... We said it was time to cash in," he said. Enrile also wanted to find out how David could not have known that Pangilinan planned to buy more Philex shares. "You do not know what was going on in your own board? " he said. David said that only operational matters were discussed during board meetings. The Commission on Audit (COA) earlier said there might be possible fraud and insider trading in the transaction. —VS, GMA News