Friday, October 20, 2017

Source: Cossec cannot disclose fiscal plan details under oversight board orders

By on February 10, 2017

SAN JUAN – Sergio Ortíz Quiñones, President of the Cooperatives Supervision & Insurance Corp. (Cossec by its Spanish initials), said Friday that the fiscal plan, which the entity should submit this month to the Fiscal Oversight & Management Board, proposes strategies to stabilize the system but he did not offer any more details.

Ortíz Quiñones made his statements after a request was made by Caribbean Business. However, the paper learned from other sources that the Fiscal Board has instructed Cossec to avoid making statements about its Fiscal Stability Plan, which has been outlined since 2016.

“This document proposes strategies to stabilize the Puerto Rican cooperative system and its more than 900,000 members. The Fiscal Stability Plan will also include the insurance of funds and other transactions that must be considered for the sector’s stability, in a plan of this nature,” Ortíz Quiñones said.

Cooperatives Supervision & Insurance Corp. President Sergio Ortiz Quiñones

Cooperatives Supervision & Insurance Corp. President Sergio Ortiz Quiñones

The Public Corporation Fiscal Stability Plan, as requested by the Puerto Rico Oversight, Management & Economic Stability Act (Promesa), must be approved by the Cossec board of directors. “To that end, among other considerations, we are joining forces with representatives of the cooperative movement,” Ortíz Quiñones said.

Noting that the document is still being drafted, Ortíz Quiñonez stated that “the transaction will be processed by the proper channels as indicated, and provided within the time established by said petition.”

Cossec is one of the entities placed under the supervision of the Fiscal Oversight & Management Board due to the government’s poor credit. It is estimated that the exposure of cooperatives to Puerto Rico bonds is approximately $ 1.1 billion, according to the group called G-25, which is composed of savings and credit institutions.

Last year, Cossec’s board of directors approved a transaction in which tax-hungry cooperatives transferred up to $ 400 million in junk bonds from the Puerto Rico government to the corporation. However, the Fiscal Oversight & Management Board paralyzed it.

 

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