Members assured: Pag-IBIG savings are safe; blacklist proceedings vs Globe Asiatique starts


The Home Development Mutual Fund (Pag-IBIG Fund) today assured its members that their savings are safe and that added safeguards to protect the integrity of the Fund are being put in place upon the directive of Vice President and Housing and Urban Development Coordinating Council (HUDCC) Chair Jejomar C. Binay.

“The Pag-IBIG Fund remains firm in its commitment to protect its members’ hard-earned savings. Our members need not worry about the safety of their savings. Their funds are intact, and will remain under their names and will be lent or, at maturity, released only to them for their benefit,” Emma Linda B. Faria, officer in charge of the Pag-IBIG Fund, said.

Faria said the agency’s budget for services and lending operations, both for housing and short-term loans, as well as funds allocated for claims, remain unaffected by the discovery of spurious transactions involving Property developer Globe Asiatique.

“Pag-IBIG is still on track in meeting its income/dividend targets for the year 2010,” she said, adding that the Fund will continuously review existing Pag-IBIG guidelines and policies “to further strengthen internal audit processes and enhance risk management measures. “

At the same time, Faria said the Agency has started proceedings to blacklist Globe Asiatique. She also revealed that as of August 31 2010, the company racked up notices of buyback totaling P1.1 billion for Xevera housing loans.

“While this amount is by no means small, this represents only half of one percent of the total assets of the Fund and is fully collateralized. We would like to assure our members that this will not affect the agency’s financial stability and capability in providing the necessary services to them,” she said.

The Vice President had ordered a thorough probe into the Xevera case during his first week as chair of HUDCC. Binay is also the chair of the Pag-IBIG Board of Trustees.

“We are ready to file the appropriate charges to protect the Fund. I have also directed the Pag-IBIG management to take the necessary steps to prevent a repeat of the Xevera case and to assure the members that their savings are being managed professionally,” he said.

Faria explained that as a condition for accreditation, developers guarantee against ineligible or fraudulent borrowers, non-completion of projects, and fraudulent transactions.

They also issue guarantees on loans against default within a period of two years. Developers also commit to buy back faulty accounts.

A breach of any of these guarantees is ground for blacklisting developers, aside from failing to remit collections under a Collection Service Agreement (CSA).

“In the case of Globe Asiatique, we have initiated the blacklist proceedings based on the results of our investigation,” she said. Earlier this year, the Fund was alarmed with its discovery of spurious transactions in the developer’s Xevera housing projects in Pampanga involving fake borrowers.

These findings were discovered through Pag-IBIG’s own validation and internal control mechanisms.

The Fund immediately implemented protective measures, including suspension of Globe Asiatique’s access to the HDMF housing program express lane facility.

The Fund also issued notices of buyback for accounts with confirmed breach of warranties. Likewise, Pag-BIG terminated GA’s Collection Servicing Agreements given the latter’s failure to remit payments to the Fund.

A full audit of all Xevera accounts was also ordered. The Pag-IBIG Fund is also speeding up the conduct of a thorough investigation on the matter to determine the administrative, civil and criminal liabilities, as may be appropriate, of concerned parties, she added.

Faria also assured accredited developers and borrowers that the Fund will continue to take out qualified housing loan applications.

“The Fund’s housing program has not just made us the biggest provider of housing loans; it showed that we are one of the more stable and viable government institutions in the country today.

Our institutional strength and our financial stability have enabled us to not just continuously honor our obligations to our members, but also allow the Fund to meet its mandates,” she said.  Source : www.pagibigfund.gov.ph

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