THE Land Bank of the Philippines (LBP) supported the Cebu City government’s plan to preterminate its loan for the South Road Properties (SRP).
In a letter dated November 9, LBP president Gilda Pico told Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco Jr. about their agreement.
“Landbank interposes no objection on the attached letter request of the Cebu City government to prepay the Metro Cebu Development Project III (MCDP III) which the Bank funded through a subsidiary loan agreement last March 1996,” Pico said.
A copy of the letter was obtained by Mayor Michael Rama who distributed copies to reporters yesterday.
He said what the city lacks among the needed requirements for the loan pretermination is the concurrence of the BSP and the Japan International Cooperation Agency (JICA).
Aside from LBP’s concurrence, Rama wrote the bank to waive the P43 million prepayment penalty for the SRP loan which currently stands at P2.4 billion.
“JICA will have to wait for the BSP (concurrence). But I don’t find any reason why they would not concur. It’s also under the loan contract that there should be no pretermination penalty,” Rama told reporters.