City to pay P182 million for 1995 SRP loan

CEBU, Philippines — The Cebu City government is set to settle P182 million to pay off the principal and interest of its first amortization of the South Road Properties (SRP) loan.

This week, Acting City Treasurer Arlene Rentuza said the office received the billing from LBP since the city is expected to pay twice a year for the loan incurred in 1995 when the city reclaimed the 300-hectare SRP.

“Mo-due ni siya on February 19, which is payable on the 20th. Ila ra ning i-debit sa Land Bank sa atong account didto,” she told reporters.

In the billing statement, the city will be paying ¥299,800,000 for the principal amount and ¥87,894,700.50 for the interest amounting to ¥387,694,700.50 for the amortization this month.

Rentuza said the LBP will convert the amount to the value of Philippine peso on February 20.

As of 4:30 p.m. yesterday, a Japanese yen is equal to P0.47.

The city government is mandated to pay twice a year; February 20 and August 20.

For this year, Rentuza said the city has allocated P448 million under its annual budget to finance the amortization.

Rentuza said the city has an outstanding balance of P2 billion to the Overseas Economic Cooperation Fund (OECF) and LBP.

She said the city incurred Y12.3 billing loan or about P3.1 billion for the reclamation of the SRP in 1995.

Last year, City Councilor Jocelyn Pesquera reiterated the request to the executive department to pay off the outstanding balance of the loan to avoid foreign exchange loss.

Pesquera said the city has incurred P1 billion net foreign exchange loss, as of 2018, after 22 years since the inception of the loan.

Last year, Pesquera said the total amount paid by the city government after 22 years of paying off amortization of the loan is at P6.558 billion which includes P3.7 billion principal amount, P2.8 billion interest, P26 million document stamps, P51,968 bank charges, P1 billion forex loss, and excluding the one percent guarantee fee of the Department of Finance up to 2016.

Asked for her comment on the paying off the total loan, Rentuza said she is still amenable to pay off the loan through amortization every year instead of wiping off the whole balance.

“I would rather not pay it off lang kay it’s so cheap man ang pagkuha ana nga loan. Although mo-fluctuate because of the currency exchange.  But, kon kinahanglan ta og kwarta, so, it’s kuan nga naay magamit,” she said, adding that paying off the loan should be done if there’s too much money from the city’s coffers.

The outstanding balance is yet to be settled in 2025, if the city will not pay it off now.  — GAN (FREEMAN)