May 23, 2017
We are writing in reference to a news article published in the May 16, 2017 edition of InterAksyon Online News, titled “Behest Loans: Alvarez Eyes Privileged DBP Loan Borrowers,” written by Ms. Lira Dalangin Fernandez.
Said article pertained to a “Commission on Audit report, which observed that the loans were released even when it could results in ‘possible loss of government funds’ and ‘higher credit risks.’”
May we clarify that DBP strictly follows and observes stringent credit policies and guidelines to ensure that loan transactions are aboveboard and compliant with relevant regulatory requirements. DBP continually applies a credit risk strategy that provides for safeguards to manage credit concentration risk that may be brought about by exposure to single name/ group borrowers and industry sectors, among others. Credit risk mitigation measures are also employed through the acceptance of eligible collaterals and guarantees, among other safeguards. Furthermore, said loans are no longer included in the audit observations of COA for 2016 given the foregoing.
May we, thus, assure the public that no behest loans were granted as alleged in the abovementioned news article. DBP continues to uphold the highest standards of banking practice, while serving the best interest of the public and the nation. The bank shall continue to direct its lending activities to developmental projects that will bring about the greatest benefit to more Filipinos countrywide.
In the interest of truth and fairness, and to safeguard the integrity of DBP as a development financial institution, we hope that our statement regarding this issue will merit space in your widely-read online news platform.
Marianne P. Garcia
Senior Assistant Vice President
Corporate Affairs Department
