Philippine National Bank’s board of directors meets with urgency today. Agenda seems but a speck of PNB’s P1.15-trillion assets, P11.4-billion profit, 8,550 personnel and 670 branches.
But the speck can inflame crisis. It concerns the suspension since March of PNB’s administrative staff. They allegedly were not informed of their offenses or afforded a chance to explain.
Their suspension came right after they reported an irregular, overpriced aircraft repair. An officer linked to the $3-million expense supposedly instigated their punishment.
Top management is in disarray. Initially supportive, superiors of the admin staff purportedly have abandoned them. Two board directors were cited in a March 8 pseudonymous complaint as aware of the events.
The suspended staff decried the sudden black mark on their employment records. They may be unable to transfer to other financial institutions. Some have been with the 107-year-old bank before tycoon Lucio Tan bought it from government in 2005. They worry about the suspension’s effect on their retirement.
If not resolved fast, the Bangko Sentral, Department of Labor, Philippine Stock Exchange and Bureau of Internal Revenue will swoop in.
Already the punishment of the investigators is affecting PNB affiliates Philippine Airlines and Basic Holdings Aviation of the Lucio Tan Group. Mr. Tan, 88, chairs the three firms and the group.
Repeated efforts were exerted over two days to contact bank EVP Aida Padilla and corporate fleet VP Clive Kian on their known mobiles – to no avail. Known as a straight-shooter but downed by Covid-19, president Florido Casuela declined an interview.
On Oct. 28, 2020 Mr. Tan approved the overhaul of PNB’s King Air executive jet’s two engines. Price: $230,000. Local offeror was Manila Aerospace Products Trading for overhauler Pratt & Whitney of Canada.
June 18, 2021 MAPTRA billed PNB $2,958,800.30, including 12-percent VAT for the overhaul.
Next day Kian, on a Basic Holdings form, signed the purchase order and payment request. Also on June 19 Kian, on PNB stock requisition form, signed for the same. He is executive assistant to chairman & CEO Mr. Tan, who reportedly is now frail and forgetful from age.
Stunned, PNB bosses sought the help of PAL, the country’s largest airline, to check the technicals and possibly haggle down the price.
Oct. 25, 2021 PAL specialist officers wrote Kian: “We cannot help but raise our earnest concern about the costly repair to MAPTRA.”
An online check showed that a brand-new King Air engine costs only $845,169, or $1,690,338 for two. After it was questioned for not offering such alternative, MAPTRA asked P&W to send a quotation for brand-new.
On top of P&W’s $1,690,338, MAPTRA tacked on a non-negotiable 15-percent administrative cost of $293,945.58. Add import costs, VAT and supposed “work in progress,” total for brand-new was $3,086,142.24.
Overhaul of $2,958,800.30 looked cheaper. Still PAL probers stuck to the $230,000 “duly signed by our beloved Chairman Dr. Lucio C. Tan.”
Receiving PAL’s investigation report, PNB’s board deferred payment. Told to probe on its own, the bank admin staff prepared their own report to Casuela for relay to the board.
Instead they were investigated by PNB internal auditors. Supposed findings: Habitual tardiness, improper uniform, sharing of passwords, missing furniture and collusion with scrap buyers.
The staff decried lack of due process: “If only our beloved Kapitan is made aware of this illegal act, he will not agree to us being insulted and treated this way. Sir Kapitan will surely admonish our officers for failing to protect the interest of the bank and rights of the employees.”
PNB doesn’t punish without hearing all sides, Senior VP Claro Fernandez said. Too, it encourages whistle-blowing, even if anonymous, for sustainability and as part of compliance with BSP rules.
Though unaware of the issue, Fernandez said “preventive suspension is done to avert purloining of documents. It is obligatory for the president and Human Resources to act on such cases.”
Sinovac safety efficacy and price still need clarifying
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