Special Purpose Vehicles and Insolvency Reforms in the Philippines
This paper focuses on the legal environment, particularly the insolvency system, that would influence the success of Philippine Special Purpose Vehicles (SPVs), also known as asset management companies (AMCs) in other countries. Since SPVs will have to operate under a given insolvency regime after they acquire the bad assets, existing bankruptcy procedures have an impact on SPV behavior, ex-ante. In particular, it influences the price that SPVs offer for the NPAs that, in turn, affects the banks’ willingness to sell, and thus the achievement of the government goal of banks’ bad loans clean-up. The paper discusses the features of the SPV Act, the pace of bad asset transfers to SPVs, the current rehabilitation procedures, and the proposed legal bankruptcy reforms that would affect the effectiveness of SPVs.
|Date of creation:||2005|
|Date of revision:|
|Contact details of provider:|| Postal: NEDA sa Makati Building, 106 Amorsolo St., Legaspi Village, Makati City,|
Web page: http://www.pids.gov.ph/
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- Qaizar Hussain & Clas Wihlborg, 1999. "Corporate Insolvency Procedures and Bank Behavior: A Study of Selected Asian Economies," IMF Working Papers 99/135, International Monetary Fund.
- Per Strömberg, 2000.
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- Lucian Arye Bebchuk, 1998. "Chapter 11," NBER Working Papers 6473, National Bureau of Economic Research, Inc.
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- Clas Wihlborg & Shubhashis Gangopadhyay, 2001. "Infrastructure Requirements in the Area of Bankruptcy Law," Center for Financial Institutions Working Papers 01-09, Wharton School Center for Financial Institutions, University of Pennsylvania.
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