sHe still has until June next year to complete his term as president of the Philippine Deposit Insurance Corp. (PDIC) but Jose “Jopot” Nograles opted instead to quit his post to pave the way for the entry of a new PDIC chief.
Reliable sources said Nograles, sworn in to the post by then-Finance secretary Margarito B. Teves on December 21, 2007, sent his letter of resignation on Friday to current Finance Secretary Cesar V. Purisima.
In that letter, Nograles told Purisima, who chairs the 15-man board of directors at PDIC, he was willing to stay on till May 31 this year when his resignation become effective.
The layover period should be enough time for Purisima to find Nograles’s replacement and give the agency sufficient space to do what it must to ensure the least disruption during the transition period.
Nograles took over from Michael Osmeña, who died of cancer in September 2007 after only about a year in office.
Among regulators, it was common knowledge that Nograles did not see eye to eye with his boss at the Department of Finance over principally policy issues.
Sources revealed while both started their careers at the accounting firm SGV & Co., they held widely diverging views on how the PDIC assistance to such banks as the United Coconut Planters Bank , the Philippine Bank of Communications and the Export Import Bank should be handled, for instance.
Their differences have to do with how to handle the closure of these problematic accounts, the same having been dropped on their laps before they even assumed their respective posts.
UCPB obtained a P20-billion loan from PDIC in 2003, when the Supreme Court inadvertently destabilized the bank when it ruled the coconut-levy funds partook of the nature of public funds and sent shivers down the spine of depositor who ran away with their money.
UCPB has since paid back P8 billion but negotiated to have the balance of P12 billion converted into equity in exchange for eight of the bank’s 15-man board seats.
How that board representation is utilized is a matter of public conjecture, according to sources.
PDIC also extended the Philippine Bank of Communications or PBComm financial assistance worth P7.6 billion in March 2004 when the lender had liquidity problems.
The assistance was in the form of a 20-year loan requiring the Luy, Nubla and Chung families as majority shareholders to sell 67 percent of their combined equity stake five years later or by 2009. That mandate to sell 67 percent of PBComm had been twice extended already and a clear outcome has yet to materialize.
Also a point of supposed contention between them was the recent sale of the Export Import Bank (EIB), which received P10 billion from PDIC.
PDIC actually gave EIB P3 billion in cash to provide the bank with immediate liquidity it sorely needed in 2004. This cash portion was used for the purchase of government securities which interest earnings kept the bank afloat.
That same transaction allowed PDIC to acquire P7 billion EIB nonperforming assets actually worth P10 billion.
