Financial Management
Liability Management

The reduction, if not elimination, of NPC’s financial obligations primarily hinges on the success of the privatization of NPC assets, including the efficient collection of the proceeds, and PSALM’s effective implementation of its liability management program. The completion of the privatization program will also help PSALM in avoiding operational losses from expensive power plants and IPP contracts.

Liability Management Transactions

The Department of Finance (DOF), in its letter dated 10 July 2015, gave its concurrence to PSALM’s prepayment of loans from Asian Development Bank (ADB), Nordic Development Fund (NDF) and Instituto de Credito (ICO) amounting to USD39.82 million or PhP1.76 billion. Later on 30 September 2015, PSALM prepaid the loans to NDF and ICO of the Kingdom of Spain amounting to USD3.66 million and PhP450.42 million, respectively. On 15 October 2015, PSALM prepaid the ADB 1984 Philippine loan amounting USD24.84 million.

Fund Management Activities

To date, PSALM has collected PhP23.01 billion from the Department of Public Works and Highways (DPWH), DENR and National Irrigation Administration (NIA) for the reimbursement of advances of PSALM/NPC for the San Roque Multi-Purpose Project Non-Power Component (SRMPP advances), with the following breakdown:

Agency Previous Years 2016 Total (In PhP)
DPWH 160,370,000   160,370,000
DENR 4,887,000,000 596,170,000 5,483,170,000
NIA 14,007,000,000 3,360,582,000 17,367,582,000
Total 19,054,370,000 3,956,752,000 23,011,122,000

On 23 March 2016, PSALM was able to collect from the DENR the amount of PhP596,170,000.00 as partial payment to the advances made by PSALM for the non-power component of the San Roque Multi-Purpose Project. The amount was deposited to PSALM’s Investment Fund under the Fund Management Agreement executed by PSALM and the Bureau of Treasury.

On 26 August 2016, the amount of PhP3,360,582,000.00 was credited to PSALM representing the Special Allotment Release Order (SARO) No. SARO-BMB-C-16-0023622 issued in favor of PSALM to cover payment of NIA’s share in the SRMPP advances.