Roberto Vergara, GSIS president and general manager (Photo from gsis.gov.ph)
The Government Service Insurance System will push through with its asset disposal program, where it plans to sell several pieces of property worth an estimated P30 billion in an auction it hopes to hold before the end of the year.
Roberto Vergara, GSIS president and general manager, said the state firm would sell off several assets located in key cities in Metro Manila to boost the pension fund.
The GSIS was supposed to bid out the assets in the first quarter, but was delayed by administrative matters, Vergara said.
“We want to monetize some of our assets, including parcels of land in various cities,” Vergara told the Inquirer last week.
The GSIS will hold on to the property that are essential to its operations and sell the rest of its assets, Vergara said.
One key asset up for sale is the former Jai Alai property in Manila, he said. Spanning 6,470 square meters, the property was previously valued at around P450 million.
In February, the Inquirer identified other GSIS assets to be sold. These include an 821-square-meter property near the US Embassy in Manila, two pieces of property on Commonwealth Avenue in Quezon City—each measuring a little over 1,000 square meters—and two lots in Mandaluyong City measuring 495 and 300 square meters, respectively.
Proceeds from the sale will be used to boost the fund of GSIS. The state firm is now exploring other opportunities in the capital market to generate more income.
Vergara said the GSIS had P770 billion in gross assets as of the end of September. Of the total, about P120 billion are in various forms of investments like equities and fixed income instruments.
He said the GSIS recently held off plans to invest abroad. It decided that, for the moment, it would be prudent to concentrate its investments on the domestic market.
Vergara said that when the GSIS made the decision, it took into account the continuing uncertainties in the world economy and the favorable growth performance of the Philippines.
“The Philippines is on good ground. Many foreign funds are going here. And so it may be difficult to justify bringing GSIS funds out of the country,” he said.
Vergara said that, with the Philippine economy on a robust growth track, corporate profits are expected to rise. This, in turn, will result in an increase in stock prices.
With these developments, the GSIS stands to gain much in terms of earnings from its equity investments, he said.
Of its P120-billion investment fund, Vergara said, 17 percent are currently in stocks.
The GSIS may consider increasing its exposure to the stock market to as much as 20 percent, Vergara added.