A group of PH banks tried to ease market fears about their loan exposures to ABS-CBN.
The industry was large enough to weather the possible impact of shutdown from the network.
In a statement, the Philippine Bankers Association expressed trust in local players’ ability. It aims to control their portfolios following the rejection of ABS-CBN, the country’s largest media network, a legislative franchise.
“The Bankers Association of the Philippines expresses its confidence in the capacity of banks. It aims to manage their credit portfolio in relation to the non-renewal of the ABS-CBN broadcast franchise,” the group said on Tuesday.
According to September 2019 financial statements, ABS-CBN had outstanding loans worth ₱27.1 billion, which are owed to multiple institutions.
After that, the network borrowed from the following firms, as listed in the quarterly report of PH banks.
They are BDO Unibank, BDO Unibank – Trust and Investment Group, Bank of the Philippine Islands, and Insular Life Assurance Company.
Then, there are Philippine National Bank, PNB Life Insurance, and Security Bank.
Those extended a ₱10-billion syndicated loan in 2010; the Philippine American Life and General Insurance Company; and the Union Bank of the Philippines.
The Settlement of the Debt was in 2014
Insular Life said in a statement on Wednesday that it currently does not have any loan exposure to ABS-CBN. In addition, the debt was already settled in 2014.
Then, as of the end of September, ABS-CBN was in line with the terms of their loan agreements.
In addition, the BAP for its part said the industry remains liquid and armed with sufficient capital to manage credit risks. To emphasize this point, the central bank’s regulatory caps provide ample buffers during possible episodes of a crisis.
“In the midst of today’s pandemic and concerns on the non-renewal of the ABS-CBN broadcast franchise, we strongly believe that banks will continue to be steadfast. The support goes for strong financial conditions, robust risk management systems, and good corporate governance,” the BAP added.
“Most importantly, we are confident that our member banks are prudent and take the welfare of their depositors at paramount importance. Your deposits are safe.”
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