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Puerto Rico’s Government Development Bank president resigns

Outgoing GDB President Javier Ferrer.

Outgoing GDB President Javier Ferrer.

Gov. Alejandro García-Padilla’s administration confirmed Tuesday that Puerto Rico Government Development Bank President Javier Ferrer tendered his resignation effective July 19.

Since his appointment in January, Ferrer, along with several other cabinet members, had been instrumental in addressing the government’s dire fiscal situation and dealing with credit ratings agencies to prevent a downgrade to junk status.

Word of Ferrer’s intended departure from the GDB had been swirling for several months, with sources suggesting clashes between cabinet members over how to handle the government’s finances. Ferrer was allegedly unhappy about “not being heard,” a source that spoke on the condition of anonymity told this media outlet.

In a press release issued late Tuesday, García-Padilla thanked Ferrer for his work, and announced the attorney would be reassigned as finance affairs advisor at La Fortaleza.

“Javier Ferrer came to resolve and address the critical fiscal situation in which we found the [GDB] and public finances,” the governor said. “He served a mission to prevent a credit downgrade and the GDB’s bankruptcy. Both actions seemed imminent given the fiscal picture we found in January. Therefore, both the people of Puerto Rico and I are very grateful.”

Meanwhile, Ferrer — who was not available for interviews late in the day — was quoted in the release as saying: “these have been months of hard work dedicated to addressing complex issues of the island’s finances. I have been fortunate to have had a great team in the GDB, including members of its board directed by David Chafey and my coworkers.”

“Much has been achieved in a short time and we’ve stabilized the fiscal situation thanks to the team and the governor’s leadership, who has always been focused on attacking head-on the sensitive fiscal challenges, protecting those who have less,” Ferrer said.

The outgoing GDB chief will be succeded on an interim basis by José V. Pagán, who is currently executive vice president in charge of the GDB’s finance division.

Ferrer’s resignation comes less than a week after he, Treasury Secretary Melba Acosta, and Office of Management and Budget Executive Director Carlos Rivas, headed to New York to meet with credit ratings agencies to outline the details of the budget approved for Fiscal 2014.

A fourth government official, Pagán, was also with them, the source said, as he was being introduced to analysts at Standard & Poors, Fitch and Moody’s, “to guarantee a smooth transition.”

Industry insiders have said Acosta is angling for the GDB position, something she has not openly denied.

Author Details
Author Details
Business reporter with 29 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other segments of Puerto Rico’s economy.

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