Government Reportedly Threatening To Ban Citibank From Country
MANILA, Philippines (AP) _ The government is threatening to suspend Citibank’s operations here because the bank allegedly is delaying talks on rescheduling the country’s debts, the Philippine News Agency reported Monday.
The government agency quoted an unnamed ″senior official″ as saying such a move was being considered in the event the bank did not soften its position on restructuring $3.6 billion in Philippine debts.
Citibank, the largest U.S. bank, operates three branches in the Philippines. There was no immediate comment on the report from bank officials.
Officials here blame Citibank for the collapse of talks last year in New York with foreign creditor banks. They say Citibank refused to accept a government proposal to a repayment scheme similar to one granted Mexico last year.
Mexico was allowed a 20-year repayment period at 13-16 percentage point over the London interbank offered rate, currently 6 1/8 percent annually.
Economic Planning Minister Solita Monsod said the Philippines sought interest of 5/8 point over LIBOR.
The Communist-dominated National Democratic Front has demanded repudiation of some foreign debts in peace talks with the government.
Government officials say the country’s overall foreign debt is expected to rise to $28.7 billion in 1987 because of current accounts difficulties.
The government of Brazil recently expelled Mellon Bank of Pittsburgh because of what it called the bank’s reluctance to go along with a restructuring of a portion of that nation’s $103 billion foreign debt.