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NEWS IN BRIEF
P/$ rate closed at P55.805 to $1
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The peso rate closed at P55.805 to the US dollar last Friday at the Philippine Dealing System of the Bankers Association of the Philippines. The weighted average rate stands at P55.858.
Thrift banks hike loans
The Bangko Sentral ng Pilipinas said that as of end-June this year, the total loan portfolio of the thrift banking industry increased to P184 billion from P160 billion the same period in 2004. The central bank reported that the sector’s loan quality also improved based on the 8.86 percent non-performing loan ratio, lower from last month’s 9.51 percent. The favorable development was due to the 4.3 percent decline in NPLs of P16.34 billion from P19.46 billion the same period in 2004. The real and other properties owned or acquired or ROPOA to gross assets ratio in the meantime declined to 10.36 percent from last year’s 11.44 percent. This is because of the 0.1 percent contraction in ROPOA to P34.69 billion from P34.73 billion last month. The ROPOA, net of performing sales contract receivables, was also down to P31.23 billion from P31.29 billion.
BoI okays Phinma housing
The Board of Investments (BoI) has approved on a non-pioneer status the P246.853 million mass housing project of Phinma Property Holdings Corp. (PPHC) in Novaliches, Quezon City. The project of PPHC, a wholly owned subsidiary of lead conglomerate of PHINMA Inc., is composed of 957 mass housing units on a 1.6- hectare site in Barangay Sauyo, Bagbag, Novaliches. It is called Spazio Bernardo and is being promoted as an Italian inspired project. It will offer a private, secure enclave in Quezon City, an environment fit for young families, self-employed individuals and overseas Filipino workers. It is accessible to major malls, schools, hospitals, government institutions, parks and other commercial centers. There will be 11 villas, walk-up five-storey building, with prices ranging from P575,000 up to P930,000 per unit. There will be 29 units per 5-storey cluster with one unit serving as the lobby on the ground floor. Commercial operations is expected to start this month. The project is expected to hire a total of 660 workers. The project will be financed through 40 percent equity and 60 percent loan. The Philippine Investment Management (Phinma) Inc. owns 59.49 percent of the company, the Bacnotan Consolidated Industries Inc. with 34.94 percent, TransAsia Oil & Mineral Development Corp. with 3.38 percent and others, 2.19 percent.
Sunlife, PNB ink agreement
Sun Life Financial-Philippines and Philippine National Bank have agreed to use the bank’s networks abroad to allow the insurer’s clients to pay premiums through the branches. It would allow Sun Life clients overseas to pay their premiums through any of PNB’s 99 Overseas Remittance Centers. "We view the OFW market as a growing middle class market," Sun Life President and CEO Lorenzo Tan said. OFWs bring in an average of $8 billion every year and Tan said Sun Life would like to provide alternatives for creating wealth and managing risks through life policies, investments in mutual funds or pre-need. Starting this month Expressnet and Express Payment System depositors of Bank of the Philippine Islands, Banco de Oro and Land Bank of the Philippines may also use their ATM cards in selected Sun Life customer centers nationwide to pay for their premiums.The collection agreement with PNB in the meantime stipulates that Sun Life’s OFW clients can pay their insurance premiums, pre-need plan installments or subsequent mutual fund investments at any PNB overseas branch or remittance centers."
Firm bids for shipping line
National Marine Corporation is making a tender offer for the 51.32 percent or 300.75 million shares of Lorenzo Shipping Corporation at P1.20 per share or a total of P185.22 million. LSC corporate secretary Arsenio Cabrera Jr. informed the Philippine Stock Exchange (PSE) that the tender offer comes after NMC bought out Neptune Orient Lines’ entire stake in LSC. It also comes after NMC entered into a voting trust agreement with Pioneer Insurance and Surety Corporation with respect to Pioneer’s 60.16 million common shares in LSC, which constitutes 20 percent of LSC’s outstanding shares. The Singapore-owned NOL’s stake acquired by NMC amounted to 28.69 percent of outstanding common stock of LSC and 82.19 percent of LSC’s redeemable preferred shares. NOL also had two nominees in the LSC board of directors. The Singapore government owns a third of container shipping and logistic company NOL. The stake acquired by National Marine totaled to 86,246,243 common shares and 86,246, 231 preferred shares of Neptune Orient Lines in Lorenzo Shipping. National Marine is a joint venture between Magsaysay Maritime Corporation and Fenwick Shipping Services Limited. It has extensive interests and operations in petroleum tankering and barging, LPG sea transport, container shipping and ship agency. Lorenzo Shipping, on the other hand is a publicly-listed container shipping company in the Philippines. (JAL)
China gets $4.5-B ADB pledge
The Asian Development Bank said that its board has approved a $4.5 billion three-year loan assistance program to help reduce poverty in China. The program will start 2006 and will end 2008. The ADB said the Country Strategy and Program update for China includes projects that support road and railway infrastructure, strengthen agriculture development, provide electricity to rural areas, and support integrated water resource management to minimize damage from droughts and floods in poor provinces. The Manilabased regional development bank said around 85 percent of the projects under the CSP will be located in the relatively deprived central and western provinces of China. The bank said China has made remarkable progress in poverty alleviation, reducing the number of rural poor to 26 million in 2004 from 250 million in 1978. It said China is also making progress on several non-income aspects of poverty, and is poised to achieve the Millennium Development Goals on maternal health and primary education. Toru Shibuichi, ADB Country Director for China, said the project’s target provinces have more than 80 percent of China’s poor. He said the projects will also focus on environmental protection, fighting corruption and improving regional cooperation. The ADB said the lending program will be complemented by grants amounting to about $11 million annually over the three-year period. The grants will focus on operational support and policy-related and knowledgebased products. (Dow Jones)
Manila Electric Co (Meralco) said residential consumers here and in neighboring provinces will pay more for their power, while commercial and industrial consumers will pay less once the interclass subsidy among its customers is reduced next month. However, the country’s largest power distributor said the higher charges for residential users should be partially offset by the complete removal of intra-grid subsidies in transmission charges, also scheduled next month. In a statement, Meralco vice-president Ivanna de la Pena said the net effect on residential consumers of the cuts in these two subsidies will be an additional P0.15 per kilowatt-hour on their bills. But her statement gave no details of the overall effect on the bills of commercial and industrial consumers. She said the Energy Regulatory Commission (ERC) has ordered the removal of the inter-class subsidy among Meralco’s commercial, industrial and residential customers in two stages — the first next month and the second in November next year. De la Pena said said the two-stage removal of the inter-class subsidy will mitigate the impact on the currently subsidized residential sector. Residential consumers who use little electricity will continue to enjoy the subsidies, she added. She said getting rid of the intra-grid subsidy will reduce transmission charges for residential customers by P0.06 per kilowatt-hour and for commercial and industrial users by P20.42 per kilowatt-hour next month.
Shell IPO tied to refinery move
Pilipinas Shell Petroleum Corp., a unit of the Royal/Dutch Shell group , said its planned initial public offering would hinge on the review of its refinery operations in the Philippines. Pilipinas Shell, the Philippines’ second largest oil refiner, said it hoped to finish by the end of next year the review on whether to shut down or expand its 110,000 barrels-per-day (bpd) refinery. "We are in the midst of conducting a comprehensive review of our refinery operations here," Shell external affairs general manager Roberto Kanapi told reporters. "The study may indicate if we will expand or shut down our refinery business so we cannot decide on the IPO yet," he added. Under the oil deregulation law passed in 1998, an oil refiner is required to list 10 percent of its shares in the local stock exchange. Pilipinas Shell has repeatedly asked the government to allow it to defer its IPO, partly due to poor market conditions. Under the law, Shell should have gone public in 2001.
PETPlans appoints CEO
PETPlans announced recently the appointment of Lorenzo T. Ocampo as chief executive officer (CEO). Ocampo is currently the president of PETPlans where he has been chief operating officer since 1992. As CEO, Ocampo will be responsible for setting the overall strategic direction of PETPlans. As chief executive, he takes over the post of his late father, Adrian V. Ocampo who was also chairman from 2003 until his death in August of this year. The company also announced the election of Rev. Edmundo M. Martinez, S.J., as Chairman of its Board of Directors. Fr. Martinez is a member of the faculty of the Asian Institute of Management (AIM) and will be assuming his position as Associate Dean of the Center for Development beginning October, 2005. He has been a Director of the PETPlans’ Board since 1988. He replaces the late Adrian V. Ocampo who served as Chairman from 2003 until his death in August of this year. As president of PETPlans, the young Ocampo continues to serve PETPlans in various capacities. He is also the president of PETNET, a money transfer agent of Western Union with the largest network in the Philippines of over 3,000 outlets. Prior to PETPlans, Ocampo was a product manager of Unilever Philippines, where he stayed for close to five years. Ocampo attended Georgetown University in Washington, D.C. where he obtained a Bachelor of Science degree in Business Administration majoring in Finance. He also attended the Strategic Business Education Program of the University of Asia and Pacific in 1995. He is a registered internal quality auditor. Outside of his official functions, Ocampo is a director of the Philippine Federation of Pre-Need Plan Companies, Inc. (PFPPCI) and was the president of the Rotary Club of Makati West.
C&P restructures FRNs
The board of home developer C&P Homes Inc. has approved a plan to restructure $150 million of floating rate notes that were issued by its unit C&P Homes International Ltd., a company report submitted to the local stock exchange said Monday. The board also approved a capital restructuring plan that will involve a reduction in authorized capital, intended to reduce the company’s deficit, C&P said. Under the capital restructuring plan, C&P will reduce its authorized capital to P500 million from P5 billion, and its subscribed and paidup capital stock to 479.61 million shares from 4.796 billion shares. "The application of the reduction surplus resulting from the ...capital decrease (will) partially wipe out the accumulated deficit of the company," C& P said. C&P will issue new shares to bring its capital back to P5 billion. The new shares will be issued to investors who have agreed to convert their holdings of C&P longterm commercial papers into C& P shares. C& P will present the plan for shareholders’ approval in a special meeting scheduled for Nov. 14. Shareholders on record as of Oct. 10 are qualified to vote on the plan.
SYDNEY, (XFN Asia) — Philippine conglomerate San Miguel Corp is believed to be in talks to buy the remaining 49 percent of Australia’s largest fruit juice company, Berri, in a transaction worth A$160 million plus, The Australian Financial Review reported. It said a San Miguel spokesman, Ramon Santiago, who is based in Manila, said on Friday that the company was "studying the purchase of the remaining 49 percent it does not already own" from Australian businessman Doug Shears. San Miguel is midway through merging the Berri group with its other large Australia asset, National Foods Ltd, which it acquired this year for A$1.9 billion. The group bought 50 percent of Berri in August 2004 for 165.7 million and acquired a further 1.0 percent from Shears a few months later to give it control.
Tycoon Alfonso Yuchengco’s group is willing to trim its stake in Rizal Commercial Banking Corp. (RCBC), one of the largest commercial banks in the Philippines. In a statement issued to the Philippine Stock Exchange, the bank confirmed a report that cited RCBC Vice-Chairman Cesar Virata as saying that the Yuchengco family is willing to have its shares diluted to raise additional capital for the bank. Virata went on to say that the Yuchengco group is open to whittling its stake in the bank to 51 percent from 60 percent. "Worldwide, the regulatory framework of the banking industry is changing and all banks must adapt to new international standards linked with it," said RCBC in its disclosure. "One necessity is capital build-up, specifically fresh infusion from foreign banks. Understandably, this translates into some dilution from the shareholdings of the Yuchengcos but ensures maintenance of majority holdings at 51 percent," said the bank. RCBC, which ranks as the ninth largest commercial bank by assets in the Philippines, didn’t provide further details on the matter. Earlier this month, the bank said it was in talks with unnamed foreign financial firms over a possible capital infusion. At the time, RCBC also said it plans to expand by buying branches of local thrift banks. Last month, the bank reported an unaudited consolidated net profit of P327.6 million for the first half, down from P1.2 billion in the same period last year. RCBC shares last traded Sept. 22 at P15 each.
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