Power Sector Assets and Liabilities Management Corp. (PSALM) has secured the go-signal from the central bank to purchase $463.39 million from the local foreign exchange market to pay for National Power Corp.’s dollar-denominated loans maturing in March and July.

The Monetary Board of the Bangko Sentral ng Pilipinas (BSP) approved the proposed purchase in advance of the dollars from the spot market last Friday.

“PSALM wants to buy the dollars now while the rates are favorable,” said a BSP source. The peso dropped 0.67 percent week-on-week to P46.50 against the US dollar.

The Monetary Board in January raised the external debt ceiling for public and private sector borrowings to $12.7 billion this year. The old ceiling was $10 billion. The central bank constantly monitors the country’s foreign debt levels, including those do not bother to register. Companies that do not register their dollar and other foreign currency denominated loans with the central bank are not allowed to buy their dollar requirements from the domestic banking system to service the unregistered loans and usually have overseas operations from which they get foreign currency.

Unregistered dollar and other foreign currency denominated loans tapped by non-banks totaled $6.26 billion at the end of September last year, higher than the $4.8 billion in outstanding loans extended by the country’s foreign currency deposit unit system. PSALM has been prepaying Napocor loans. It has reduced the power firm’s debt level by $1.2 billion to $5.8 billion in the last three years. PSALM is planning to float $400 million this quarter.