LGU GUARANTEE CORPORATION

Your link to progress

CORPORATE PROFILE

VISION

• To be the recognized private sector link in public-

private partnerships for local development financing

MISSIONS

• Advocate for reforms that will mobilize resources of

the private sector toward financing local development

projects;

• Continue to advocate for policy reforms for local

government unit (LGU) debts, whether bond floatation

or direct loans, and

• Instill value of good governance to enhance the

borrower’s enterprise management and

creditworthiness, especially local government and

utility companies

RELATIONSHIP MANAGEMENT WITH FINANCIAL INSTITUTIONS

CREDIT RATING

CREDIT GUARANTEE

GUARANTEE PROGRAM

MANAGEMENT

COLLABORATION WITH NATIONALGOVERNMENT

Financial Institutions

• Pays loans / bond amortization

• Calls on guarantee if borrower defaults

BORROWER

AAA Due Diligence / Credit Rating

• Provides loans

• Underwrites bond issues

• Guarantees FIs against borrower default

• Pays FIs in case of default according to original

amortization schedule

Republic of the Philippines

DOF and DOE

Guarantee Program

Implementation Agreement

ROP Grant Agreement

US$12MM

Guarantee Program Manager

Guarantee Reserve Escrow

Agreement

Escrow Agent

As Implementing Agency of GEF

World Bank

Project Agreement & LGUGC Grant Agreement

Republic of the Philippines

DOF and DOE

Guarantee Program

Implementation

Agreement

ROP

Grant

Agreemen

t

Guarantee Program Manager

Guarantee Reserve Escrow

Agreement

Project Agreement & LGUGC Grant

Agreement

Global

Environment

Facility

United

Nations

Developme

nt

Programme

ESCROW

AGENT

Implementing Agency Grant

Provider

US$1.6MM

REGULAR ECPCG CBRED-LGF

Lender Any LGUGC partner

financial institution

(PFI)

Any LGUGC PFI Any LGUGC PFI

Loan Term Cash flow-based Up to 10 years Up to 10 years

Grace Period Depending on project

requirement

At least 1 year grace

period, but not to exceed

the PFI loan term

Maximum 2 years

grace period, but not to

exceed the PFI loan

term

Single Guarantee

Limit

25% of LGUGC Net

Worth

USD2.5 Million PhP50 Million

Guarantee

Coverage

Up to 85% of the debt

service to the PFI; up to

80% for ECs

Up to 80% of the loan

principal amount and 3

months interests, subject

to LGUGC interest rate

cap

• Up to 85% of the

principal

amortization

• To be determined

based on PFI

request and

Borrower Risk

Rating results

Guarantee Fee • Risk-based

• Ranges from 0.25%

to 2% per annum

0.25% per annum 0.25 per annum

• United States Agency for International Development (USAID) – Development Credit Authority (DCA): Co-Guarantee for Water Projects

• World Bank – Global Environment Facility Electric Cooperative System Loss Reduction Project – Partial Credit Guarantee Program (ECPCG): Program Management

• Department of Energy – Loan Guarantee Fund (DOE-LGF) for Renewable Energy Proponents: Program Management

• European Union (EU)/Global Partnership on Output-Based Aid (GPOBA)/World Bank – Access to Sustainable Energy Project (ASEP): Program Management

Banco de Oro Unibank, Inc Philippine Veterans Bank

Bank of the Philippine Islands Rizal Commercial Banking

Corporation

Development Bank of the

Philippines

Robinsons Banking Corporation

EastWest Banking Corporation Security Bank Corporation

Land Bank of the Philippines Union Bank of the Philippines

Metropolitan Bank & Trust

Company

United Coconut Planters Bank

Philippine National Bank

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

ROE 2.5% 2.4% 4.7% 4.7% 6.2% 9.5% 6.5% 13.5% 5.5% 5.4% 6.1% 6.8% 7.6% 8.0% 15.2% 5.6% 3.5% 2.7% 2.8%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

Axi

s Ti

tle

Return on Equity

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

ROA 2.6% 2.3% 4.2% 4.2% 5.5% 8.3% 6.0% 12.8% 5.3% 5.2% 5.9% 6.5% 7.2% 7.5% 12.9% 4.4% 2.9% 2.3% 2.5%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

Axi

s Ti

tleReturn on Assets

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Profit Margin 28% 24% 34% 33% 41% 49% 45% 69% 52% 50% 54% 50% 59% 60% 64% 38% 28% 29% 28%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Net Profit Margin

1999

20

00

2001

20

02

2003

2004

20

05

2006

20

07

2008

2009

20

10

2011

2012

20

13

2014

20

15

2016

2017

0.720.76

0.66 0.67

0.59

0.510.55

0.31

0.480.50

0.460.50

0.41 0.400.36

0.62

0.740.71 0.72

COST TO INCOME RATIO

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Leverage Ratio 0.30 4.10 5.03 4.36 5.03 6.70 3.90 2.12 2.31 3.93 3.93 3.60 5.10 4.01 3.98 4.80 4.50 6.72

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

Leverage Ratio - Net Worth

WDs

LGUsMLEs

ECs

Bonds

PPPs

REPs

• LGUGC was the first to successfully introduce a guarantee

mechanism for LGU borrowings in the Philippines

• Various technical assistance from USAID, AusAid, World Bank

• Selection of LGUGC by DOF and DOE as Program Manager for

various programs

• BSP approval of LGUGC’s proposal to reduce risk weight of

LGUGC-guaranteed debts to 20%

• BSP confirmation of 0% risk weight for EC loans guaranteed under

the ECPCG program

• Appointed as Program Manager of ASEP

• Invited to present LGUGC in various out-of-the-country workshops

and seminars by international donor agencies

• Rated PRS Aa plus (corp) in 2010 by the Philippine Rating Services

which has been maintained as of to date

1. LYDIA N. ORIAL

EDUCATION

• Bachelor of Science in Management & Industrial Engineering (MIE) from

MAPUA Institute of Technology (Magna Cum Laude and Gold Medalist)

• MBPA Candidate (no thesis) from De La Salle Graduate School of

Business & Economics (Gold Medalist)

• MBE Candidate (no thesis)/Certificate in Business Economics Strategic

Business and Economic Planning (SBEP) Program from University of Asia

and the Pacific (formerly CRC)

PROFESSIONAL EXPERIENCE

• LGU Guarantee Corporation (LGUGC)

o President/CEO (April 26, 2007 to present

o Officer-in-Charge/Sr. Vice President/Asst. Treasurer (July 31, 2006 to April 25,

2007)

o Sr. Vice President, Operations Group/Asst. Treasurer (July 1, 2005 to July 30, 2006)

o Sr. Vice President, Operations Group/Asst. Treasurer (March 1998 to June 30, 2005)

• BAP Credit Guaranty Corporation (BCGC)

o Managing Director/Asst. Treasurer (March 1999 to June 2004)

o Sr. Vice President, Operations and Marketing Groups (April 1991 to February 1998)

• Guarantee Fund for Small and Medium Enterprises (GFSME)

o Director, Planning and Management Services Group (July 1989 to March 1991)

o Manager, Corporate Planning Department (January 1985 to June 1989)

o Executive Assistant to the Deputy Managing Director (June 1984 to December

1984)

PROFESSIONAL EXPERIENCE

• Home Development Mutual Fund

o Research and Project Dev’t Officer, Corplan Division (July 1983 to June 1984)

o Research and Project Dev’t Analyst, Corplan Division (October 1981 to June 1983)

• Mapua Institute of Technology

o Instructor (1981 to 1983)

• SGV and Company

o Technical Assistant (December 1978 to September 1981)

OTHER PROFESSIONAL EXPERIENCE

• 1997 Outstanding Mapuan in MIE

• Manila Bulletin Columnist

2. THELMA C. SANSALES

EDUCATION

• Bachelor of Science in Commerce, Major: Accounting (Dean’s Lister)

from University of Sto. Tomas -Manila

• Master’s Degree in Business Administration (Dean’s Lister) from Ateneo

Professional School of Business

PROFESSIONAL EXPERIENCE

• LGU Guarantee Corporation – Operations Department Head (1998 to

Present)

• Pryce Corporation – General Accountant (1993-1997)

• Aboitiz Air Transport Corporation – Staff Accountant (1991 to 1993)

• SGV & Company – Junior Auditor (1990 to 1991)

3. ALLAN D. BELGICA

EDUCATION

• Bachelor of Science in Commerce, Major: Accounting from Mabini

Colleges

• Units in Llb and MBA from University of Nueva Caceres

• Management from Bicol University

PROFESSIONAL EXPERIENCE

• LGU Guarantee Corporation

o Sr. Manager/Head-Relationship Management Department (2013 to

Present)

o Account Officer (October 2006 to 2013)

• Land Bank of the Philippines

o Bookeeper III, Credit Investigator III, Accounts Analyst to Account

Management Specialist (February 1991 to September 2006)

• Development Bank of the Philippines –Service Corporation

o Documents Analyst/Bookeeper (May 1998 to February 11, 1991)

• Development Bank of the Philippines

o Contractual Clerk (October 1987 to May 1988)