"Whimsical, irrational and irresponsible action (on the part of Buenaventura) has no place in the Bangko Sentral," declared Assistant Minority Leader Michael Defensor (LP, Quezon City) in a privilege speech.
He said that for unknown reasons, the BSP governor and the Monetary Board refused to extend P3.5 billion in emergency loans requested in April by Urban Bank when it was encountering cash flow problems due to heavy withdrawals.
In fact, he said the top two officers of the failed bank, Arsenio Bartolome III and Teodoro Borlongan, were in Buenaventura’s office on April 25, the day Urban Bank declared a bank holiday, to follow up on their request.
Defensor claimed that by refusing to extend the requested loans, the BSP head and the Monetary Board violated the BSP law which mandates them to bail out troubled banks by giving them emergency funds.
"They bailed out I-Bank and the Philippine Bank of Communications, received P9 billion and P5 billion, respectively, in emergency loans from the Bangko Sentral," he said.
Why did the same central bankers refuse to extend a P3.5- billion loan requested by Urban Bank? he asked.
Defensor also pointed out that within 12 hours from the time Bartolome and Borlongan declared a bank holiday on April 25, the Monetary Board decided to close the bank without giving it a chance to save itself and without a thorough audit.
The audit would have determined whether the bank was solvent or insolvent, he said.
He said the BSP closed the bank even with Buenaventura’s announcement that other banks were "below par" compared to Urban Bank.
The opposition congressman also accused the BSP governor of conflict of interest arising from his post as vice chairman of Philippine Airlines, which is majority-owned by beer and tobacco tycoon Lucio Tan.
He said Buenaventura should not hold any other position in the government or the private sector, much more so in a company owned by one with substantial interests in the industry that the BSP regulates or supervises.
Defensor is the second congressman, after Makati’s Joker Arroyo, to call for the ouster of the BSP head.
Earlier, Arroyo said Buenaventura should quit his central bank job so he could work full-time as PAL vice chairman, and so that a replacement could focus on stabilizing the peso-dollar exchange rate.
Authorities have recently filed charges against Bartolome, Borlongan and other Urban Bank officers in connection with the failure of the bank.
Bartolome was the chairman and founder of the bank, while Borlongan was its president.
Former President Fidel Ramos, who was honorary chairman and who held a small office at the bank’s Makati headquarters, was not among those charged.– Jess Diaz