By Chino S. Leyco
State-run Home Development Mutual Fund, commonly known as Pag-IBIG Fund, said that it will hold a series of public consultations before implementing the increase in monthly savings rate in 2021.
According to Pag-IBIG, the increase in monthly savings from the current total of P200 per month to P400 is just a “proposal” despite being “unanimously” adopted by the agency’s board of trustees.
“The proposal to increase monthly savings shall still undergo consultations with our stakeholders,” Jack Jacinto Jr., Pag-IBIG public relations office head said.
Last week, Eduardo D. Del Rosario, Pag-IBIG chairman discussed in a press briefing the planned increase in monthly savings, where he said “during our special board meeting, we talked about risks and the focal issue that was raised is would it be P150 or P200? And the board unanimously said it will be P200.”
“Making it P200, I think, mukang napaka baba pa nga,” del Rosario, who is also the chairman of the Housing and Urban Development Coordinating Council, noted. “We have a timeframe of reaching out to all stakeholders so that there will be a widespread acceptance of this plan.”
He also said that Pag-IBIG is needing a raise in savings “because we don’t like to increase the interest rate being given by the fund to all our members. This will be a welcome opportunity on the part of the members and I hope the employers will support this stand of Pag-IBIG Fund.”
But Jacinto clarified “the amount of increase, if any, shall depend on the results of such consultations. Pag-IBIG Fund has always been considerate of our stakeholders’ welfare and leans towards their best interest.”
“A consultation will be conducted first before a decision to increase the members’ monthly savings is reached,” Jacinto said.
However, del Rosario pointed out the increase is “very important, that for stability, we increase the mandatory savings in 2021 so that the demands can really make the right projections.”
“And rate of yearly increase of 15 percent to 20 percent, we can only sustain until 2020. By 2021, we have to borrow, if we will borrow, we will increase the interest rate,” he added.
But Jacinto said Del Rosario’s borrowing plan from private banks is just “a possibility” should demand for loans would reach around 20 percent annually. He also said there are other sources of funds aside from private financing to meet the projected demand.
“We are capable of funding all loan releases without having to borrow funds, should growth in loans be less than the above rate,” Jacinto said.
“There is no funding shortfall. The P40 billion (P40.27 billion to be exact) is our Member Savings collection and is merely a portion of our total collections. We were also able to collect P53.21 billion in short term loan amortizations and P55.73 billion in housing loan amortizations in 2018, the latter being the highest in our history,” he added.
In 2018, Pag-IBIG posted its highest ever net income of P33.17 billion.