DBP LOAN TO ONGPIN LACKS FEATURE OF BEHEST MONEY - LAWMAKER
MANILA, OCTOBER 19, 2011 (TRIBUNE) By Angie M. Rosales - Senators probing the P660-million alleged behest loan extended by the state-owned Development Bank of the Philippines (DBP) under the Arroyo administration are at loggerheads over the existence of supposed insider trading involving businessman Roberto V. Ongpin who made pur-chases of Philex Mining Corp. shares through the use of the borrowings.
"No, that has not been established. That's just an in-dividual opinion of senators," Sen. Francis Escudero said in reference to Ongpin's acquisition of shares of Philex Mining Corp. (Philex) in 2009 through two loans secured from DBP.
"A behest loan, as what we have seen during the incumbency of former Pres. (Ferdinand) Marcos, is that the loan has not been serviced, unpaid or unsettled and the bank was taken advantaged of and such seems to be not the case here," he said.
Escudero also negated the contention made by Sen. Sergio Osmeña III and Senate President Juan Ponce Enrile on supposed insider trading Ongpin supposedly engaged in, in trying to get ahead of other investors in Philex' shares of stocks, pointing out that in the proceedings, it was obviously known to other players that the businessman was trying to accummulate additional shares prior to the bulk sale to tycoon Manuel V. Pangilinan.
"Osmeña said everybody knew (that Pangilinan is buying Philex shares) and then Enrile is claiming it was only Ongpin who
knew about it at that time, which is which? Because if everybody's aware of it, then it's not insider trading," he pointed out.
Both Escudero and Santiago, in separate interviews, also said that Ongpin's claims that he has been prejudged by senators is a valid concern.
Santiago said that at the rate the Senate is conducting hearing on the alleged behest loan, it appears that there is basis on statement of Ongpin that he is already prejudged by the Senate.
"Politicians like senators are not supposed to judge but to legislate." It is not the function of the Senators to find who is guilty or not but to craft good laws," she said.
Likewise, Sen Santiago said the purpose of any investigation is to find the loopholes of the law and then make necessary remedy to avoid confusion.
"So that's what I wanted to know on my fellow Senators, do they want be investigators or senators, said Santiago.
While she is not against any Senate inquiry currently jointly undertaken by the blue ribbon and banks committees, Santiago said she wonders why some senators are so eager beaver in probing the Mr Ongpin when the Senate can only do recommendation.
"All the findings of the Senate inquiry are not binding but recommendatory in nature. It is the Ombudsman that will ultimately look into the case of anyone being probed by the Senate," she said.
Escudero said Ongpin can not be faulted if such is his impression on the manner that senators are handling the investigation.
"There are some senators (who may have prejudged him) but not most of us. I'm just wondering why the current DBP officials are now engaged in investigating the transaction where the bank earned profit by almost a billion and yet they have not acted upon other transactions where they lost more than P2 billion.
"Those in DBP seems to be at each other's neck, slapping each other with cases. I'm wondering why this is happening, which even led to the suicide of one of its executives," he said.
The matter of the more than P400 million that could have been earned from the transaction, had the Philex shares were sold by DBP and not by Ongpin to Pangilinan, was speculative, Escudero said.
"That's what they were claiming as due to insider trading which means that at the time, you knew that the stocks would shoot up from P12.75 to P21 per share. But nobody knew then. Since these instruments were in the form of stocks, Ongpin can not be faulted for showing interest in acquiring them and others should have been curious then and engaged in the same because there was demand, the reason why the price increased," he said.
Escudero said the matter of supposed insider trading will likely be clarified when Ongpin returns to the country and submit himself before the Senate panels.
"If he will be able to attend, he can shed light on the whole issue and we're hoping he will be able to give his side of the story.
"Whatever judgement we will make, it should come after we have heard the person being accused in this case. We should await the testimony of Ongpin and I trust that he will face the issue soon," said Escudero.
"The problem now is how can you prove that he knew then what would happen next? We should hear it straight from Ongpin, I suggest," he added.
Also yesterday, Senate probers are gearing towards investigating the other huge loans extended by government financial institutions to bankroll other takeover bids, including Petron and Meralco.
"We have several more loans to talk about at the next hearing," Osmeña, banks committee chairman said over the weekend.
The senator said they are likewise interested in finding out what were the "other loan exposures" aside from the P660 million that DBP extended to Ongpin.
"I just wanted to know what are the other loan exposures," Osmena told former DBP president Rey David at a Senate hearing last Friday.
For instance, Osmeña reminded David of "the Ashmore deal for the Petron shares and then you sold your Meralco shares to Global 5000 (which) you mentioned in the last hearing and it was a company also controlled by Bobby Ongpin, Iñigo Zobel and Butch Campos. And you gave them a four-year loan."
EARLIER NEWS
ROBERTO ONGPIN SAYS 'I need no Mike Arroyo to succeed in business' 'Been doing investment banking deals for 26 years now' By Daxim L. Lucas Philippine Daily Inquirer 2:32 am | Sunday, October 9th, 2011
He does not need the backing of Jose Miguel "Mike" Arroyo to succeed in business or obtain big-ticket loans, said businessman Roberto Ongpin as he defended his three-decades-long track record in investment and business.
In a phone interview on Saturday from Europe, where he is on a business trip, Ongpin objected to the statements that Sen. Sergio Osmeña III made during and after the Senate hearing on Friday into the P660-million loan that the Development Bank of the Philippines extended to Ongpin in 2009, which the businessman used to finance his acquisition of Philex Mining Corp. shares.
Osmeña said, among other things, that for the transaction to have been made possible at all, there must have been a "B"—or Big Man—behind Ongpin, which many have taken to mean as suggesting that the influential backer must be Arroyo.
"I don't need an A, B, C, D, E or even an FG (popular shorthand for former First Gentleman Arroyo) backing me up for me to be successful," said Ongpin.
"I have been doing investment banking deals for 26 years now," he said.
Not bigness or luck
Ongpin also took exception to what he said was Osmeña's remark that he was not "big enough" for the DBP to grant him such a large loan, and that Ongpin was quite "lucky" to have been able to make a large profit from buying and selling Philex Mining Corp. shares.
"It's not a question of bigness. It's a question of diligent research and analysis. In the same manner, it's not a question of luck. It's a question of careful analysis and judgment calls," he said.
"That's how I make money. Not [through] influence," he said.
To Osmeña's claim that he must have been backed by an influential personality, Ongpin said: "I admire Senator Osmeña, but just as he does not require a powerful backer to be a good politician, I, too, do not need a powerful backer to be a good businessman."
"While I admit to being Mike Arroyo's friend, we met no more than five times during the entire Arroyo administration, and only once in Malacañang," Ongpin said.
"Is it a crime now to be his friend?" he asked.
Ongpin pointed out that he had been engaged in large deals since he brought in Malaysian business tycoon Robert Kuok to invest and put up the Edsa Shangri-La Hotel in Mandaluyong City during the administration of President Corazon Aquino.
Since then, the Kuok group has invested an estimated $3 billion in six hotel and high-end residential developments in partnership with him, including a new Shangri-La hotel being built in Fort Bonifacio in Taguig, Ongpin said.
The Philippine investments of his latest partner, the UK-based Ashmore Group investment fund, is worth an additional $2 billion, he said.
'Undue haste'
The controversy stemmed from two loans—P510 million and P150 million—that the DBP extended to Ongpin in 2009 for him to acquire the Philex shares, some of which were bought from the DBP itself.
The DBP's new board of directors has claimed that the loan to Ongpin was "behest" because it was allegedly granted with "undue haste" and without sufficient collateral cover.
The new board also accused the former DBP board and its former president, Reynaldo David, of putting the bank at a disadvantage for selling the DBP's Philex shares at P12.75—itself, already double the DBP's acquisition cost—when Ongpin sold the same shares a few days later to businessman Manuel Pangilinan at P21 per share.
The former leadership of the bank also exposed the DBP to undue risk for allegedly granting the loan with insufficient collateral, the new board claimed.
The controversial deal is being investigated in the Senate by a joint inquiry of the blue ribbon committee chaired by Sen. Teofisto Guingona III and the committee on banks, financial institutions and currencies, chaired by Osmeña.
It is also the subject of at least three court cases.
Not behest
In Saturday's phone interview, Ongpin said the loan cannot be called behest because it was repaid fully ahead of its maturity date, was fully collateralized, and earned for the bank P4 million in interest and P1.3 billion in trading gains.
He stressed that the loan from DBP made up only 17 percent of the total financial package he borrowed from seven banks to be able to acquire a pivotal stake in Philex which, after it was sold to Pangilinan, allowed the latter to take control of the country's largest mining firm.
No Marcos crony
Ongpin admitted to feeling "frustrated" at constantly being called a "Marcos crony" and the loan he acquired being labeled "behest."
"It's annoying, quite frankly. I was one of the technocrats during the Marcos administration, and was certainly never a crony," said Ongpin, who served as trade minister under the late dictator Ferdinand Marcos from 1979 to 1986.
Despite his dismay at the current turn of events, the businessman said he would continue to bring in partners to invest in the Philippines.
"I love this country, and I will continue helping it," he said.
As for his critics and opponents, he said: "I am a battle-scarred man, having fought many wars in the past."
"I'm happy to wage war with them, because I'm certainly no pussycat," Ongpin said.
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Chief News Editor: Sol Jose Vanzi
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