PSALM cuts debts by P40 billion, improves collection efficiency

By Lorenz S. Marasigan – January 21, 2021
from Business Mirror

The Power Sector Assets and Liabilities Management Corp. (PSALM) said on Tuesday it was able to reduce its obligations last year, while cutting interest rates and improving collections.

In a statement, the state-controlled corporation said it has reported to the Department of Finance (DOF) that its principal obligations at end-December stood at P381.91 billion, a P40.10-billion reduction from the P422.01-billion obligation the year prior.

“PSALM adjusted its currency mix by borrowing in peso while paying foreign currency obligations, thereby, lowering the ratio of foreign currency obligations and mitigating foreign exchange risks,” the statement read.

It also paid all interests and borrowing costs that matured in 2020 totaling P11.56 billion.

Likewise, it was able to cut the average interest rate of its borrowings from 5.07 percent per annum in 2019 to 4.17 percent in 2020.

The agency also reported that it has successfully collected deferred privatization proceeds amounting to P38.656 billion. These are composed of payments from Independent Power Producer Administrators and from the concession payments from the transmission business.

“PSALM was able to achieve a collection efficiency rate of 93.94 percent for power sales equivalent to P12.895 billion from its power customers,” the statement read.

It was able to collect P2.61 billion from overdue and delinquent accounts of power customers, which were absorbed from the National Power Corp.

PSALM also collected P16.69 billion in Universal Charge, achieving a 98-percent collection efficiency, and has likewise hit 100 percent in disbursement efficiency from UC-Missionary Electrification Charge and the Renewable Energy Developers, disbursing a total of P3.55 billion.

The state-owned corporation also disposed 10 real estate assets for P51.65 million, and raised another P26.45 million from retiring equipment and selling its scrap materials.

“To generate additional income, PSALM entered into short term lease agreements with government offices over certain assets that are not yet scheduled for privatization, raising additional revenues of P29.50 million,” the statement read.

Last year, PSALM also saved P861.49 million from its real property tax liability by reducing the said levy from P1.06 billion to P198.81 million.

Currently, PSALM is finalizing a study with the Asian Development Bank (ADB) for the privatization of the Caliraya-Botocan-Kalayaan (CBK) Hydroelectric Power Plants (HEPPs) and the Casecnan HEPP. The results of the study are expected to be released within the month.