Postcript

The Philippine Star

Thursday, December 10, 1998

By FEDERICO D. PASCUAL

Unless President Estrada cracks the whip, most government financial institutions can be expected to sit on proposals for them to contribute to a bailout fund for Philippine Airlines.

The flag carrier, while deserving of aid, looks like a high risk with its built-in costly inefficiencies.

Philippine National Bank, for one, will not be able to live it down if after its infusion of P750 million in PR Holdings Inc. and its giving big loans to PAL for the purchase of aircraft, it will still plunk in good money after the earlier investments had gone sour.

Other possible sources of bridge financing, such as the Development Bank of the Philippines, the Land Bank and the Social Security System, will have to study very well how they can justify further exposure in PAL.

One slim alternative left is for the President to press for the PAL-Cathay Pacific deal to jell. But that would mean giving in to the Hong Kong-based airline's demands regarding management and valuation.

Well, we can't win them all.