The United Coconut Planters Bank (UCPB), the country’s 12th-largest lender in terms of assets, has extended a P997-million term loan to Occidental Mindoro Consolidated Power Corp. (OMCPC) to finance the construction of a 20-megawatt (MW) diesel-fired power plant.
Set in San Jose, Occidental Mindoro, OMCPC’s first power plant is seen completed within the month, while the commissioning of the plant is scheduled in December.
UCPB Executive Vice President and Corporate and Consumer Banking Group Head Higinio O. Macadaeg Jr. signed the loan agreement with OMCPC officials in September. He said the bank sees high value in projects within the energy sector.
“The bank sees a lot of value in projects, such as this. When the power plant becomes online, the province will have a more stable supply, which will benefit residents and enterprises in the province,” Macadaeg said.
OMCPC President Luis Manuel T. Banzon explained that so-called rotating brownouts in the area lasts from to 12 hours a day: “For a time, San Jose was known as the blackout capital of the country because it lacked supply to cover the province’s requirement and was disconnected from the main grid.”
Banzon added that the lack of a stable energy supply in the province also hampered the economic growth of the province.
The new power plant is expected to energize not only Occidental Mindoro but also some parts of neighboring Oriental Mindoro.
Earlier this year, UCPB also granted P167.73-million worth of loans to Misamis Occidental Electric Cooperative I (MOELCI I) to ensure the steady supply of electricity in the rural areas and in support of power distributors as a whole.
MOELCI I is pursuing capital expenditure projects, such as the upgrade of its power distribution facilities and replacement of its electrification system.
The additional substation capacity will reduce system losses in the communities they serve by 2.45 percentage points from 13.15 percent in 2011 to 10.70 percent in 2016. Currently, MOELCI I is the main distributor of electricity to the northern part of Misamis Occidental consisting of one city and six municipalities with 227 barangays.
The UCPB 10-year term loan is guaranteed by the LGU Guarantee Corp. (LGUGC) up to 80 percent of the total amount through its regular guarantee program, as well as the World Bank’s Electric Cooperative-Partial Credit Guarantee (EC-PCG) Program.
UCPB’s net income expanded by 42 percent to P1.8 billion, from P1.3 billion in the first semester of 2016. The bank posted a loan-portfolio surge of 21 percent to P138.6 billion. Its consumer loans, which comprise 43 percent of the total loan portfolio, rose 29 percent.
Operating income reached P6.1 billion in the first half of 2016, 15 percent higher than the P5.3 billion the bank posted in the same period in 2015.