THE Securities and Exchange Commission has given ailing pre-need firms four to five years to build up their impaired capital and trust funds as a result of the economic slowdown, its top official said yesterday.
The securities watchdog offered the capital-buildup program at the request of the Philippine Federation of Pre-Need Plan Companies, but it would be open only to the 24 firms that were granted a dealer’s license this year, Commission Chairman Fe Barin told reporters.
The 24 were given until April 15 to apply, but a source said other pre-need firms would likely also apply to be included as a result of the hard times.
The poor investment climate was making it difficult for pre-need firms to meet the projected yields on their trust funds, the source said.
The total trust fund deficiency of pre-need firms stood at P46.83 billion at the end of June last year, which has resulted mainly from shrinking investment earnings, industry figures show.
That means pre-need firms will have to increase their capital and put more assets in their trust funds to cover their deficiency, and the capital-buildup program gives them between now and 2013 to do that.
To boost their trust fund, pre-need firms may invest in unlisted companies and plan-holder loans. They may also invest up to 15 percent of that fund in real estate provided the investment generates income.
Pre-need firms applying for the program must submit a five-year projected financial statement and a 15-year financial program.
Those approved to join the program will not be allowed to declare dividends, stock options, warrants or bonuses in the five years that the program is in force. –Jenniffer B. Austria, Manila Standard Today
Invoke Article 33 of the ILO constitution
against the military junta in Myanmar
to carry out the 2021 ILO Commission of Inquiry recommendations
against serious violations of Forced Labour and Freedom of Association protocols.
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