Congressmen hit Philippine central bank governor for Estrada withdrawals

After having the unenviable job of steering the monetary policy and the weakening peso during the impeachment trial of Estrada, Buenaventura faces another unenviable job of steering his own career.

Philippine central bank governor Rafael Buenaventura is taking hits from all sides. The former high school classmate of ousted President Joseph Estrada has a fixed term until July 2005, but clamor for his resignation is getting noisier.

When bank records revealed this week that Estrada withdrew Ps143 million ($2.86 million) on 24 April 2000 from UrbanBank just two days before the Monetary Board shut it down, congressmen accused Buenaventura of tipping off the former President. 

(How Estrada amassed huge amounts that allegedly reached Ps1.3 billion ($26 million) in one savings account alone, among others, was the subject of his impeachment case.)

Howls of “incredible” were heard when Buenaventura declared that at the time the withdrawals were made the Monetary Board has not yet decided to close down UrbanBank.

On Thursday, Buenaventura maintained his innocence, citing the strict provisions of the deposit secrecy law. He said he was not in a position to know who the depositors were or the amount of their deposits.

Then another broadside hit him when letters arrived in the Malacanang - the presidential palace - questioning Buenaventura’s assumption of office. This time the complaint is Buenaventura was appointed Bangko Sentral ng Pilipinas (BSP) governor without observing the one-year cooling off period before a private sector individual can be appointed as BSP governor.

Buenaventura defended his appointment by saying the cooling off period only referred to prior connections with multi-lateral agencies such as the IMF or World Bank.

Another complaint is that as governor of the BSP, the Commission on Appointments of the Philippine legislature never confirmed Buenaventura’s appointment. This would mean that Buenaventura has not perfected the security of tenure under the Central Banking law. Forthwith, newly installed Philippine President Gloria Macapagal-Arroyo has legal grounds to withdraw Buenaventura’s appointment.

Buenaventura’s banking career included stints as CEO of Citibank Philippines and as CEO of PCIBank, one of Manila’s biggest banks.

UrbanBank officers, including founder Arsenio Bartolome and Teodoro Borlongan, are filing charges against Buenaventura and former Philippine Deposit Insurance President Norberto Nazareno in connection with the hasty closure of the bank.

In the meantime, the peso rose against the dollar for the fifth straight day, closing Thursday at Ps48.250 at the Philippine Dealing System (PDS).