CB-BOL folded up this year; assets transferred to Treasury

The Central Bank-Board of Liquidators (CB-BOL), the administrator and liquidator of the old Central Bank of the Philippines’ (CBP) assets and liabilities, will be shut down on July 2 this year, its acting chairman Finance undersecretary Gil S. Beltran said over the weekend.

The CB-BOL’s debt to the National Government (NG) still amounts to R413.45 billion at the end of 2016, based on a Commission on Audit report. The CB-BOL is tasked to dispose all assets and liabilities not transferred or assumed by the Bangko Sentral ng Pilipinas (BSP) when it was reestablished in 1993.

Basically, all bad assets were left behind with the CB-BOL while the BSP took the “good ones,” according to Beltran.

“We will close our doors on July 2, 2018. We have been transferring assets to the National Treasury. As of end-December 2017, assets transferred amount to R3.2 billion,” he said.

The outstanding liabilities of CBBOL will be transferred to the NG as well. “Those are liabilities to the NG,” added Beltran. The government Treasury and its accountants “will know what to do with it.”

Between now and until end-June this year, Beltran said they will finalize sorting out the remaining assets for transfer, and updating real property taxes and completing deeds of assignment to the NG. Some, he noted, will be up for litigation.

Under the law, CB-BOL has 25 years or until 2018 to dispose of and liquidate the assets and liabilities of the old central bank.

As an institution under liquidation, CB-BOL continues to post deficits until abolished. All accounts due to the NG represent the liabilities of the old central bank, including advances made by the government in paying its matured obligations.

Dues to the NG are accounts that represents “all liabilities of the CBP retained with CB-BOL at the time of the split of assets and liabilities of the former central bank between BSP and CB-BOL on July 3, 1993 and subsequent advances made by the NG in servicing the matured retained foreign obligations, partically reduced by CB-BOL remittances from various collections.”

Based on the audit report at the end of 2016, out of the total R413.45-billion liabilities to NG, R279.30 billion were NG servicing of CB-BOL liabilities, while R137 billion were retained deposits of the Treasury of the Philippines. The rest were accrued interests on the BoT.

There were no more government advance payments on the Brady Bond exchange with RP bonds by 2016 compared to 2015 when it was still charged with R26.48 billion.

The government considers CB-BOL liabilities as part of consolidated public sector financial deficit which included the old central bank restructuring.