THE LAND BANK of the Philippines (LANDBANK) said it was the leading member of a loan syndicate providing P110 billion to the Power Sector Assets and Liabilities Management (PSALM) Corp.
“We will continue to support PSALM in addressing the energy needs of the country today and in the future,” LANDBANK President and Chief Executive Officer (CEO) Lynette V. Ortiz said in a statement on Thursday.
LANDBANK said it will be supplying P60 billion of the syndicated loan, which PSALM will use to augment its working capital, refinance liabilities, and settle domestic contractual obligations.
PSALM President and CEO Dennis Edward A. Dela Serna signed the loan facility with LANDBANK and the Development Bank of the Philippines (DBP) on July 30.
“PSALM’s liability management program has presented significant challenges as we strive to fulfill our mandate of liquidating the financial obligations we have assumed. This syndicated loan provides additional financial support to PSALM, ensuring our continued progress and assist our asset management and privatization strategies,” Mr. Dela Serna said.
“With this loan, we are projecting a net reduction of P12.9 billion in our financial obligations for calendar year 2024,” he added.
LANDBANK and DBP were the joint lead arrangers for the syndicated loan, with the DBP Trust Banking Group as the facility and paying agent, and the Office of the Government Corporate Counsel as the transaction counsel.
PSALM is a wholly owned government entity authorized under the Electric Power Industry Reform Act (EPIRA) to take over all generation assets of the National Power Corp. (NPC), independent power producer contracts, real estate, and all other disposable assets, including the transmission business of the National Transmission Corp.
PSALM also manages the sale and privatization of these assets with the objective of liquidating all of NPC’s financial obligations.
LANDBANK has been financing PSALM since 2008 in compliance with the terms of the EPIRA law. — Aaron Michael C. Sy
