Opposition hits BSP's P20.1-B loans to nat'l gov't

The Bangko Sentral ng Pilipinas (BSP) has violated its own charter by granting loans totaling P20.1 billion to the national government, opposition congressmen said yesterday.

The accusation is contained in Resolution 1322 in which the lawmakers asked the House committee on good government to inquire into the alleged violation by the Bangko Sentral of its own charter, otherwise known as the New Central Bank Act.

The measure is principally authored by Rep. Oscar Moreno (Lakas, Misamis Oriental). Sixteen other opposition lawmakers led by Minority Leader Feliciano Belmonte Jr. (Lakas, Quezon City) co-authored the resolution.

Moreno said the Bangko Sentral granted the national government two loans to pay for the country's subscription or membership in the International Monetary Fund.

The first loan, amounting to P6.8 billion, became due in November 1997 but has remained unpaid. The second loan, granted in February last year, was for P13.3 billion and for a term of five years. Both loans are non-interest bearing.

Moreno said under the New Central Bank Act which Congress enacted in 1993, the Bangko Sentral is prohibited from engaging in development banking or financing and from extending long-term loans to the national government.

He admitted though that the law allows the BSP to lend short-term funds to the government to finance expenditures authorized in the annual budget.

He said Congress provided enough safeguards in the law to prevent a recurrence of the excesses of the old Central Bank which resulted in billion-peso losses.

The New Central Bank Act abolished the old CB and created in its place the Bangko Sentral ng Pilipinas.

Losses of the old Central Bank were absorbed by the national government. The BSP thus started with a clean slate.

Moreno said the Bangko Sentral should not commit the same mistakes that led to the bankruptcy of the old CB. --