Thursday, October 18, 2007 Psalm to pay Napocor’s foreign debts
THE Power Sector Assets and Liabilities Management (Psalm) announced that it will pay at least US$2.4 billion out of the US$7 billion debts of the state-run National Power Corporation (Napocor).
Psalm president Jose Ibazeta said they might use either the proceeds from Napocor assets sold this year to settle part of the agency’s loans or from borrowings.
“Napocor has around US$7 billion debts. In the past, Napocor has been exposed with the peso depreciation during the Asian crisis from P26 to P56. Now, Napocor's exposure has been mitigated when the peso appreciated from P55 to P45. And that plan of refinancing is to change the profile of the debt of Napocor because we're actually 92-percent forex debt, and we want to shift that to peso to almost 42 percent,” Ibazeta said.
He said they are studying to settle their Yen debts or initially US$1.3 billion of the US$2.4 billion loans.
“Primarily our debt now is in Yen and in Dollars and some in Peso. We want to shift our debt to primarily peso and dollars. But the yen, it's our objective to take it out, because the yen is getting stronger,” he explained.
According to Ibazeta, about 32 percent of their debt portfolio is in Yen, 55 percent in Dollars, nine percent in Peso, three percent in Euro and less than one percent is in Korean Won.
Ibazeta hoped that they would pay the initial US$1.3 billion loan in the next six months.
He pointed out that the refinancing plan was primarily geared towards taking advantage of the peso appreciation. He said the refinancing plan would address three things such as foreign exchange rate, liquidity rate of Napocor, and interest rate exposure of Napocor. (MSN/Sunnex)
