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Friday, March 29, 2024

Court sheriff begins to garnish LBC assets

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A Makati court sheriff garnished six bank accounts of courier company LBC Express Inc. in a bid to collect P1.8 billion from the LBC Group in favor of state-run Philippine Deposit Insurance Corp.

LBC Express Inc., one of the country’s leading courier and freight forwarding services companies owned by the Araneta family, said in a disclosure to the stock exchange the court sheriff had attached six peso current bank accounts with a combined balance of P9.976 million as of Jan. 6.

The Makati regional trial court branch 143 in December issued a preliminary attachment against LBC Development Corp. and LBC Express Inc., after PDIC filed civil cases to collect P1.8 billion worth of “unpaid services fee.”

PDIC is seeking payment from the LBC Group of the Araneta family following the closure of LBC Development Bank in September 2011. PDIC, the appointed receiver and liquidator of LBC Development Bank, said the defendants owed P1.8 billion.

LBC Development is the parent company of the listed company LBC Express Holdings, which in turn owns LBC Express Inc.

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LBC Express said while the initial garnishment had no immediate material impact on business operations, further garnishments of its bank accounts could pose some administrative and operational challenges in terms of payment to suppliers and business partners.

LBC Express said to address the situation, it advised its customers, suppliers, lessors and other counter-parties to coordinate with the company to ensure continued payments and services. 

LBC Express said it would continue to exert utmost effort to fully attend to the needs of customers and ensure regular ongoing operations. 

The company said it also commenced the process of communicating with its bankers. 

“Further, LBC Express Inc. is thoroughly assessing the situation through the assistance of legal counsel, and will exhaust all legal remedies to resolve this matter as soon as possible,” LBC Express said.

The company said the writ was a provisional remedy and the assets or cash of LBC Express should be made to answer only upon final judgment being rendered against LBC Express.

“We are very much aware, however, that whether or not the claims against LBC Express are successfully proven, there can be no assurance that these claims will not cause business interruptions or reputational harm to LBC Express Holdings Inc. and may ultimately have a material adverse effect on its financial performance and prospects,” the company said.

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