Mass housing developer 8990 Holdings Inc. said Wednesday it is in talks to sell P2 billion worth of receivables to Security Bank Corp.
8990 Holdings president and chief executive Januario Jesus Atencio III said the company planned to sell P2 billion worth of contract to sell or CTS receivables in April.
Under the proposed deal, the purchase value would be based on outstanding principal balance. The receivables must be seasoned for at least 12 months, with no past due experience.
Atencio said last month 8990 aimed to sell P11 billion worth of receivables out of its nearly P19 billion CTS receivables to four local banks this year.
CTS is the company’s in-house financing program for potential homebuyers.
The company said as of end-2015, at least 76 percent of CTS receivables were under the CTS 11 Program, which yielded 11 percent per annum and enjoyed rebate of 1.5 percent for the first five years as long as buyers paid on time.
About 57 percent of the CTS receivables portfolio were seasoned for at least one year, as home buyers were able to pay on time for a period of one year and thus were less likely to default.
8990 Holdings also signed an agreement to sell P1 billion worth of receivables to BPI Family Bank last year.
The CTS portfolio of 8990 jumped 35 percent in terms of value to P18.99 billion in 2015 from P14.11 billion in 2014. It also increased 30 percent in terms of housing units to 20,330 from 15,597.
Interest income from CTS went up by 34 percent to P1.2 billion last year from 901 million in 2014.
8990 earlier said it expected net income to grow 20 percent in 2016 to P4.8 billion, as it planned to unveil 14 new house and lot and mid-rise developments across the country.
Revenues are also projected to increase 24 percent to P12 billion.