President Rodrigo Duterte has signed an executive order (EO) adjusting the dividend rate of the Philippine Guarantee Corporation (PHILGUARANTEE).
EO No. 153, signed by Duterte on Monday, adjusts the dividend rate of PHILGUARANTEE to zero percent of its annual net earnings from 50 percent following the recommendation of Finance Secretary Carlos Dominguez.
“Pursuant to Section 5 of RA [Republic Act] No. 7656, the percentage of net earnings to be declared and remitted by the PHILGUARANTEE to the National Government for CYs [calendar years] 2019 and 2020 is adjusted from 50 percent of its annual net earnings to zero percent,” the EO read.
The adjusted dividend rate set forth in Section 1 of this Order is only applicable to PHILGUARANTEE for calendar years 2019 and 2020.
RA No. 7656 requires all government-owned or -controlled corporations (GOCCs) to declare and remit at least 50 percent of their annual net earnings as cash, stock, or property dividends to the National Government.
It also provides that the President of the Philippines, upon the recommendation of the Secretary of Finance, may adjust the percentage of annual net earnings to be declared by a GOCC in the interest of national economy and general welfare.
Pursuant to RA No. 7656, the Secretary of Finance has recommended the downtrend adjustment of the percentage of the net earnings that shall be declared by the PHILGUARANTEE as dividends to the National Government for CYs 2019 and 2020, to support PHILGUARANTEE’s role in facilitating and promoting socio-economic development through the provision of credit guarantees to the priority sectors of the economy as well as support its capital position and allow it to comply with the Bangko Sentral ng Pilipinas regulations.
The PHILGUARANTE is a GOCC created under EO No. 58, Series of 2018.
It is mandated to perform development financing through the provision of credit guarantees in support of trade and investments, exports, infrastructure, energy, tourism, agricultural business/modernization, housing, micro, small and medium enterprises and other priority sectors of the economy, with the end in view of facilitating and promoting socio-economic and regional development.
EO No. 153 takes effect immediately.
Source: Philippines News Agency
