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STATE-OWNED Land Bank of the
Philippines
is putting up for sale, via public bidding, some P4
billion worth of acquired assets in two to three weeks,
its asset sale manager said on Tuesday.
The
local unit of California-headquartered real estate
services firm CB Richard Ellis made the announcement in
a statement e-mailed to financial reporters.
Up for
grabs are foreclosed condominium units, stand-alone
residences, office space and idle residential and
commercial lots located mostly in Metro Manila.
These
assets represent about a third of Land Bank’s real and
other properties acquired, or ROPAs, as of end-December
2006.
This
much real estate forms part of a huge portfolio of
nonperforming loans of some P100 billion that lenders
like Land Bank will try to dispose of within the year.
“We are
optimistic we can dispose of a sizeable chunk of our
ROPAs through this auction,” Land Bank special assets
department head Maria Cecilia Sacay said on Tuesday.
Of the
estimated P51 billion worth of nonperforming loans the
banks vowed earlier to sell this year, some P31 billion
worth have actually been sold to so-called special
purpose vehicles, Bangko Sentral governor Amando
Tetangco Jr. said.
The
banks originally intended to sell a total P62.7 billion.
There
are tax and registry privileges involved in selling
foreclosed property but none more important to them than
the one allowing banks to book the loss over a fixed
number of years.
Nonperforming assets are sold at deep discounts, a
painful exercise for banks compelled to reflect their
loss in their books of accounts and making capital
provisions for them taken out of their earnings.
Fortunately for them, the Special Purpose Vehicle Act
allows banks to distribute losses resulting from such
asset sales over a number of years to soften their
impact on profits, which are zealously guarded by bank
shareholders.
Land
Bank itself has nonperforming loans equal to 7.26
percent of total loan portfolio as of end-September
2006, its latest.
This was
more or less within industry norms as aggregate NPLs in
the banking system totaled 6.96 percent or P140.98
billion as at end-November last year. |
