GAPAN City -- The Regional Trial Court here granted the motion of the local government of San Antonio, Nueva Ecija to deposit, as an act of good faith, the amount of over P15 million representing the 2019 payment of its loan from East West Banking Corporation.
The bank loan payment is now the subject of a civil complaint for annulment of bank interest charges sought by the LGU before the RTC Branch 87.
In an order dated February 23, acting presiding judge Maximo Ancheta Jr allowed the plaintiff LGU represented by Mayor Arvin Salonga, through counsel Jennifer Patacsil-Arceo, to deposit the amount of P15,241,164.36 to the defendant-bank.
The amount represents the LGU's yearly installment payment of its loan that was earmarked by the plaintiff in its 2019 annual budget.
The civil case arose when the LGU sought to stop East West Bank from imposing a higher 7.25 percent interest rate instead of six percent on two previous loan agreements worth P106.58 million, which were entered into by the past administration of former mayor Antonino Lustre.
The court said it granted the motion after the defendant-bank failed to comment on the issue despite the opportunity given.
“Without prejudice to the outcome of the instant case, the court finds it equitable to allow the plaintiff to make a deposit of the installment payments that fall due in the year 2019 at the rate of six percent per annum or the amount of P15,241,164.36,” the court said.