Bloomberg News

Philippine Banks Seek Funds Withheld From Bonds Amid Court Order

October 26, 2011

Oct. 26 (Bloomberg) -- Eight Philippine banks asked the Bureau of the Treasury to pay them the amount withheld as 20 percent tax on interest earnings on bonds that matured last week after the Supreme Court directed the government on Oct. 18 not to impose and collect the levy.

The banks demand that the government follow the court order, said Francis Lim, a lawyer for the eight lenders, confirming that an Oct. 21 letter was sent to the Treasury and that the Treasury said the government would reply to the court order through the Office of the Solicitor General. Failure to comply with the court order will compel the banks “to undertake the necessary legal remedies,” according to its Oct. 21 letter sent by the law office representing Banco de Oro Unibank Inc., Metropolitan Bank & Trust Co. and six other lenders.

--With assistance from Clarissa Batino in Manila.

To contact the reporter on this story: Karl Lester M. Yap in Manila at kyap5@bloomberg.net

To contact the editor responsible for this story: Clarissa Batino at cbatino@bloomberg.net


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