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Philippine Interest Rate Protested

March 2, 1998

MANILA, Philippines (AP) _ Hundreds of businesses in a southern Philippine town were closed Monday as their owners protested high interest rates charged by local banks.

Protest leader Augusto Velarde said 90 percent of shops, hotels and offices in Koronadal in South Cotabato were paralyzed as about 1,000 people joined a protest march.

Velarde, leader of the Koronadal business association, said they were demonstrating against what they consider excessive interest rates charged by local banks, which had left many local companies unable to repay their loans.

``We got the loan at only 15 percent but when we woke up the next morning it reached 35 to 40 percent. We did not agree to that,″ said Velarde. ``We did not foresee that interest will go up that high so now we cannot pay.″

Deogracias Vistan, head of the Bankers Association of the Philippines, said banks across the Philippines were directed by the association on Feb. 2 to lower interest rates by one percentage point every week until they reach around 21 percent.

Vistan said banks violating the agreement should be immediately reported to the association for proper action.

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