[ Malaya.com.ph ] September 23, 2008
By JIMMY CALAPATI
Metropolitan Bank and Trust Co. yesterday said that it has sought court protection for two affiliates-partners of Lehman Brothers South East Asia Pte Ltd.
Metrobank’s pre-emptive action is the first blood drawn among local financial intermediaries with exposure to bankrupt Lehman Brothers.
Metrobank said the two companies, Philippine Investment One, Inc. and Philippine Investment Two, Inc., owe it P2.4 billion.
The two companies used the Metrobank loan to buy foreclosed properties and non-performing loans of the Development Bank of the Philippines and the United Coconut Planters Bank.
Metrobank said it has submitted to the Regional Trial Court of Makati petitions to put the two companies under corporate rehabilitation.
In a disclosure to the Philippine Stock Exchange, Metrobank said it filed a petition for rehabilitation with prayer for staying all claims, actions and proceedings for both companies.
Court protection will ensure the continued normal operations of the companies and defer all claims, actions, and proceedings against them.
"This creditor-led rehabilitation is a preemptive move to protect the bank against possible dissipation of assets by foreign claimants," Metrobank executive vice president, Vicente R. Cuna said.
To date, Metrobank said the loan is current and both companies are operating normally.
In its petition, Metrobank said that unless a stay order is issued by the Court, the companies will suffer setbacks in meeting their financial obligations while they are being beleaguered by the attempts of some creditors to enforce payment of their claims to the detriment of other creditors, especially with the recent act of default by Lehman Brothers.
The other banks with exposure to Lehman are Banco de Oro Unibank, f$134 million, RCBC with $30 million, Metrobank with $20.4 million—all with Lehman— and Security Bank, which has exposure worth $10 million to Merrill.
Metrobank said the filing is necessary to prevent any undue preference to certain creditors, and to ensure that the assets of both companies are properly preserved for the benefit of all the creditors during the period of rehabilitation.
Philippine Investment One and Two are in the business of investing in non-performing assets of financial institutions under the terms of the Special Purpose Vehicle Act of 2002.