Slow but sure: Here’s how Treasury is settling court case on PEACE bonds
The Bureau of the Treasury has given in after the long legal battle.
Eight banks who had pending claims from the government over the highly-controversial Poverty Eradication and Alleviation Certificates (PEACE) bonds, which date back to the Arroyo administration.
As part of its 2016 annual report, China Banking Corporation said it has received the withheld amount and 4% interest per annum from October 19, 2011 to April 10, 2017 from the Treasury, following the Supreme Court’s final decision that rendereed the so-called development bonds as tax-free instruments, versus the Bureau of Internal Revenue’s view that these should be slapped with taxes. The high court ordered the government to pay an aggregate P5 billion to the eight banks holding PEACE bonds.
Apart from China Bank, the other lenders got their share were BDO, Bank of Commerce, Metropolitan Bank & Trust Company, Philippine Bank of Communications, Philippine National Bank, Philippine Veterans bank, and Planters Development Bank.
But the plot twist was that the Treasury also paid their dues through the one thing it knows: bonds.
“Total settlement amount are paid in the form of 3-year Retail Treasury Bonds in minimum denominations of P5,000.00 with interest of 4.25% per annum,” China Bank disclosed.
It’s going to be an even longer story!