INSURANCE Commissioner Emmanuel F. Dooc said the interim governance board pursuing the financial rehabilitation of the National Life Insurance Co. of the Philippines (NLIC) recommended the sale of its headquarters along Ayala Avenue in Makati City to raise part of the capital needed to put the insurer back on its feet again.
The rehabilitating insurer also continues to seek the entry of white knights whose participation helps determine whether its financial future is assured or whether or not it was time to throw in the proverbial towel and accept dissolution. The insurer’s Ayala headquarters has been assessed as worth more than P1 billion and should go far in the drive to erase a capital deficiency exceeding P2 billion.
Dooc refused to identify the strategic investor but said the potential white knight was a local investor.
He said the interim governance board was also open to entertaining other offers and is, in fact, looking at other measures to put the insurer back to its normal operations.
Such measures include the sale of NLIC’s real properties, including the National Life Building along Ayala Avenue in Makati City, which, according to the proposal of the appointed conservator, could be sold for at least P1.6 billion, net of value-added tax.
Dooc said the interim governance board will study all of these proposals for possible capital infusion and sale of real properties as a whole, to determine the best possible way to go about the rehabilitation of NLIC.
The Insurance Commission (IC) had earlier ordered the implementation of a rehabilitation plan for NLIC that involves the conversion of its unsecured debts to equity, which was supposed to have brought the company’s capital from a negative net worth of P2.1 billion to a positive net worth of P134 million. However, despite the approval of the debt-to-equity conversion, NLIC would still be suffering from a P116-million capital deficiency. Hence, the need to sell some of the insurer’s real properties and the need quickly to find a new investor, Dooc said.
The rehabilitation of NLIC was ordered by the IC last November 2013.
The appointed conservator was originally given a six-month period to complete the rehabilitation, but Dooc had granted several extensions to give potential investors more time to conduct the necessary due diligence, and for the interim governance board to study the proposals. The latest of such extensions was granted last August 12, 2014, for a period of 120 days.