Cebu City to pay P960-M loan balance for South Road Properties in August

After the bank loan is entirely compensated the metropolis will be ‘officially credit card debt-no cost,’ states Jerome Castillo, the metropolis marketing consultant for finance and unique assistant to Cebu City Mayor Mike Rama

CEBU, Philippines – The Cebu Town govt will pay back its P960-million personal loan balance for the development of the South Road Homes (SRP) by August.

The SRP is previous city mayor Tomas Osmeña’s blended-use advancement venture. Proceeds from the job had been applied to fund the city’s pandemic response in 2021.

Attorney Jerome Castillo, the town expert for finance and particular assistant to Cebu Metropolis Mayor Mike Rama, informed Rappler on Tuesday, June 7, that the town now has the necessary paperwork and spending plan for the total payment of its P4.5-billion mortgage from the Japan Global Cooperation Company (JICA) that it contracted in 1995.

“The focus on day is August 19 as we have previously consulted with the Landbank of the Philippines for the total payment,” he explained.

In accordance to Castillo, the metropolis secured cash for the financial loan payment from the city’s 2022 finances and a supplemental finances accredited by the Metropolis Council.

“The initially is the provision from the yearly budget really worth P200 million and the supplemental spending plan, which is another P800 million, to address the remaining harmony,” Castillo stated.

The remainder of the secured spending budget following shelling out off the SRP bank loan will be returned to the town for potential use, he explained.

Castillo claimed that after the financial loan is entirely paid out, the town could be regarded as “officially credit card debt-totally free.”

Cost savings

In 2015, Rama pursued the payment for the 30-calendar year SRP loan and negotiated its prepayment with Landbank.

According to Castillo, Rama’s major aim for the prepayment was to assure that the city would have more than enough discounts to use in the long term.

“When we computed it in 2015, it would have been several hundreds of tens of millions we could have saved experienced we pushed by means of with the prepayment,” Castillo said.

The strategy did not force through thanks to a improve in administration in 2016 and the deficiency of specifications and authorization from Bangko Sentral ng Pilipinas and the Town Council, Castillo additional.

“Now, we are nonetheless saving considerably less than a hundred million,” he added.

Castillo recommended a ceremonial payment for transparency needs.

Previously in April, Cebu City Mayor Mike Rama vowed that the town would shell out off its remaining personal debt for the South Street Homes (SRP) prior to the close of his time period. 

Rama was reelected in Might, successful above previous City councilor Margot Osmeña.– Rappler.com