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Monday, September 22, 2008
GSIS, SSS urged to disclose Lehman investment
MANILA -- The Government Service Insurance System (GSIS) and the Social Security System (SSS) were urged to assure their members that they are not affected by the US financial crisis as a result of the collapse of Lehman Brothers.
Education Secretary Jesli Lapus said Sunday that GSIS president Winston Garcia and SSS president Romulo Neri owe their members an explanation in the wake of reports that a number of Philippine banks have investment exposure in troubled US financial firms.
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GSIS is the country's largest state insurance agency for government workers including the almost half a million teachers and non-teaching staff nationwide.
SSS, on the other hand, is the biggest government operated insurance institution that caters to social security of employees and workers in the private sector.
Teachers groups Alliance of Concerned Teachers (ACT) and the Teachers Dignity Coalition (TDC) and the Department of Education-National Employees Union (DepEd-NEU) have earlier expressed belief that the GSIS should issue an official statement on the matter.
The groups said they wanted to be clarified on the extent of the effect, if indeed investment was made, on GSIS.
Antonio Tinio, ACT president, said GSIS members demand transparency on GSIS investments especially in the midst of uncertainty in this global financial crisis.
For his part, DepEd-NEU president Domingo Alidon said they are preparing a letter to Garcia so that union members will have a categorical statement on the GSIS exposure to US financial woes.
The union will take proper legal action if the GSIS was dragged into this mess and should Garcia fail to fully explain satisfactorily why investment was made without the consent of the members or even at least being informed of such undertaking, said Alidon.
Earlier reports said there is no question that countries in Asia, including the Philippines, are feeling the impact of the financial turmoil besetting the US financial players.
At least four banks in the country, Banco de Oro Unibank (BDO), Metropolitan Bank and Trust Company (Metrobank), Rizal Commercial Banking Corporation (RCBC), and state-owned Development Bank of the Philippines (DBP) admitted that they have exposure in the collapsed US bank.
Banco de Oro Unibank (BDO) and Metropolitan Bank and Trust Co. (Metrobank) said they had put up loss provisions totaling US$94 million for their exposures to products sold by Lehman Brothers and its affiliates.
BDO, the second-largest bank by assets, was the first one to file a disclosure with the Philippine Stock Exchange, saying it had set aside P3.8 billion (US$80 million) as a buffer for its investment exposure in Lehman.
Metrobank, with the biggest in assets, also reported that it had put up US$14 million in provisions for its exposure in Lehman bonds in the amount of US$20.4 million.
For its part, RCBC said it was allocating P980 million (about $20.8 million) for its $30-million (P1.4-billion) investment in "structured products" linked to Philippine bonds and issued by Lehman.
The DBP meanwhile said it also has a very small exposure in Lehman's financial products.
Senators have earlier called on GSIS and SSS to disclose their investments in the troubled US financial firms. (AH/Sunnex)
For more Philippine news, visit Sun.Star Pampanga. (September 22, 2008 issue)
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