BSP keeps rates unchanged

The Bangko Sentral ng Pilipinas said yesterday it was keeping its policy interest rates unchanged, as the market expected, due to the strong peso and easing inflation risks. The BSP raised rates three times in 2005 by a total of 75 basis points. Its overnight borrowing rate is 7.50 percent and its lending rate is 9.75 percent, the highest in four years. "The Monetary Board noted that recent evidence of easing inflation pressure supports an unchanged policy setting," BSP Governor Amando Tetangco said.. "Easing energy prices, favorable food prices and the appreciation of the peso should help keep price pressures at bay in the near-term," he said. "There has also been relatively limited indication thus far of secondround effects from ongoing supply shocks." The peso was Asia’s best performing currency in 2005, rising about 6 percent against the dollar, and has carried the momentum into this year. In December, consumer prices rose 6.6 percent from a year earlier, below government forecasts. Average inflation in 2005 was 7.6 percent, at the low end of the central bank’s forecast but above the 2004 rate of 6 percent. The central bank expects inflation of 7.5 to 8.2 percent in 2006.

GSIS gets offer for EPCIB bloc

Two groups of foreign investors, represented by a Manila-based lawyer, have offered to buy all the shares of the Government Service Insurance System (GSIS) in Equitable-PCI Bank at P92 per share, GSIS President and General Manager Winston Garcia revealed yesterday. He said he received a letter from the lawyer, whom he declined to identify for the moment, shortly before 4 p.m. yesterday. "On behalf of our two groups of clients, we hereby register their intention/interest to buy all the shares of stock of the GSIS in Equitable PCI Bank at the price of R92 per share, subject to adjustment depending on the result of the due diligence examination of the records of the bank and the terms and conditions that may be mutually agreed upon," the letter to Garcia stated.

CAB freezes airline license

The Civil Aeronautics Board (CAB) decided not to renew the provisional authority of Singapore budget airline Tiger Airways Ltd to operate Clark-bound flights from Singapore via Macau after the permit expired on Dec. 31, 2005, CAB executive director Eduardo Mañalac said yesterday. CAB, however, added that it has allowed Tiger Airways to continue its Singapore-Macau-Clark flights for 10 more days until January 20 to accommodate passengers who have bought their tickets. "We don’t want their passengers to be inconvenienced," Mañalac said. He said the aviation board found Tiger Airways guilty of three violations, including advertising and selling of seats even before lodging an application with the Philippine industry regulator. Mañalac said Tiger Airways was also found to be charging rates that have not been approved by CAB and falsely claiming that its services have obtained the regulator’s approval. Tiger Airways is 49 percent owned by Singapore Airlines, while the Singapore government’s investment arm, Temasek Holdings, owns 11 percent. Tony Ryan, the founder of European low-cost airline Ryanair, and US private investors Indigo Partners are the other partners in the venture.Tiger Airways began its Macau stopover flights on Oct 30, 2005. But Manalac said CAB learned that Tiger Airways had been selling Macau tickets as early as July last year.

Quedancor issues P50-M notes

The Quedan and Rural Credit Guarantee Corporation (Quedancor), a government financial institution tasked to promote rural productivity and generate livelihood and income opportunities, announced that it has issued P750 million worth of corporate notes. The issue represents the first of two equal tranches that will raise a total of R1.5 billion for Quedancor. Proceeds of the fund-raising will be used for re-lending under Quedancor’s loan programs. First Metro Investment Corporation (FMIC) and United Coconut Planters Bank (UCPB) have been tapped once more by Quedancor to act as Joint Issue Managers and Lead Arrangers for this corporate notes offering. The second P750-million tranche is targeted for issuance within 60 days from the issue date of the first tranche last December 21, 2005. In June of 2005, Quedancor successfully floated a R1.5-billion multi-series bond offering to banks and insurance companies.

NFA tenders new rice import

National Food Authority (NFA) said yesterday it had set a tender for Feb. 7 to buy 400,000 tonnes of rice for arrival between February and May. The fresh grain requirement would bring to 750,000 tonnes the total volume of rice the government will import in the first half. The Philippines bought 350,000 tonnes of rice, mostly from Vietnamese companies, in December. The shipment is scheduled for delivery between January and March. "For 2006, we expect rice imports not to exceed the total 1.8 million tonnes that we bought in 2005," NFA Administrator Gregorio Tan told Reuters by telephone. He said the Philippine rice harvest in the first six months of the year was expected to be higher by 5 to 6 percent from the same period a year earlier because of better weather conditions. Most of the rice crop in the first half of 2005 was damaged by a drought caused by the El Nino dry weather pattern. The NFA, the rice-importing arm of the government, said in a noticer that rice in the February tender should be sourced from Thailand, Vietnam, China, Pakistan, Australia or the United States.

ALI sees 15% net profit rise

Ayala Land Inc. will likely see its net profit grow 15 percent this year, with a subsidiary that builds low-cost houses contributing to the improvement, JP Morgan said. In a note to clients, JP Morgan said it is keeping its "overweight" rating for Ayala Land as the stock trades close to a 15 percent discount to its 2006 net asset value estimate. A unit of the property firm, Avida Land Corp, has said it plans to start two to three new projects every year to address demand for affordable housing. Its prices range from P500,000 to P2.5 million per home. The subsidiary also intends to open more offices overseas to boost sales to Filipinos working abroad. Sales to such people accounted for 25 percent of Avida’s sales last year. "We see the secular trend of growing overseas Filipino workers’ remittances as particularly beneficial to the property sector," JP Morgan said. Remittances this year are expected to reach a record high of .5 billion, 10 percent more than last year, the central bank has said. "The growing efficiency of remittance centers abroad also bodes well for property sales in the country as remittances can now be streamed directly towards the purchase of homes," JP Morgan added. Ayala Land has yet to report its net profit for last year. In the first nine months of the past year, its net profit rose 46 percent year-onyear to P2.6 billion on the back of 35 percent growth in revenues to P16.5 billion. Its nine-months earnings also included a one-time gain from the sale of its interest in preferred redeemable shares of Astoria Investment Ventures Inc.

Cocoplans trust fund hits P-B mark

Cocoplans, two-time awardee for Most Outstanding Pre-Need Plans ProviderCompany, reaches the 1 billion mark for its accumulated Pension and Education Plans trust fund amounts. In a report from the company’s trustee bank, United Coconut Planters Bank (UCPB), Cocoplans posted a total trust fund balance of P1,054,687,194.77 in its Trust Fund Account as of November 30, 2005. For which, P875,286,999.23 is for Pension and P179,400,195.54 is for Education. The report further stated that the funds are free from lien, restriction, condition or holdout. Planholders also gets the advantage of Cocoplans’ triple protection with Cocolife as its insurance underwriter, the UCPB as its trustee bank, and of course, Cocoplans itself. Cocoplans has 150 million unimpaired capital stock, double the amount that the Securities and Exchange Commission requires. Cocoplans President Caesar T. Michelena said that the company’s growing trust fund is a clear indication that indeed, the company’s planholders are 100 percent assured that they will be given their due benefits on the day promised. "Our company regards the investments of our planholders very seriously. That is why we prepare three months in advance for the maturing plans," he said.

PSB notes rated PRS Aa

Philippine Savings Bank’s proposed P2 billion Tier 2 issue has been rated PRS Aa plus by the Philippine Ratings Services Corporation. The unsecured subordinated debt or Tier-2 issue will have a maximum term of 10 years with a call provision after five years. In assigning the rating, Philratings considered PS Bank’s market position as one of the leading players in the attractive consumer banking sector, solid support from parent Metropolitan Bank and Trust Company, synergies realized from being part of the Metrobank group, and management’s focused vision and coherent strategy. Philratings also took into account PSBank’s strong core earnings, its good asset quality, sound funding base, and acceptable capitalization level. prevailing market and economic conditions.

Colgate sells detergent business

SAN FRANCISCO (XFN-Asia) — Colgate-Palmolive Co said it has sold its Southeast Asian heavy-duty laundry detergent brands to Procter & Gamble Co. Colgate said the Procter & Gamble transaction, touching brands marketed in Thailand, Malaysia, Singapore and Hong Kong, includes the sale of Fab, Trojan, Dynamo and Paic. Because of the sale, two detergent dedicated factories will be closed or modified, Colgate said. Colgate said it expects the one-time net gain resulting from the Dec 31 transaction will be fully offset by fourth-quarter restructuring charges under the company’s 2004 plan. Further financial terms were not disclosed. "This sale is part of Colgate’s ongoing strategy to de-emphasize and eliminate low-margin portions of the business while focusing on our high-margin, fast-growing oral, personal and pet care businesses," Reuben Mark, Colgate’s chairman and chief executive, said in a statement. Simplifying the company’s portfolio will increase gross profit margin in the Asia/African division and will enable increased focus on the other businesses, he said.

ADB okays 0-M China loan

BEIJING (XFN-Asia) — The Asian Development Bank (ADB) said it has approved a 0 million loan for wastewater treatment and water quality improvement in the Hai river basin in central China’s province of Henan. The loan will fund construction of facilities to collect and treat wastewater and to deliver clean water to 15 cities around the highly polluted Hai river basin, the ADB said in a statement. The project will also promote institutional and financial reforms and enhanced management, the ADB added. The Hai river basin, one of the three most polluted river systems in China, has been severely affected by domestic and industrial wastewater, the ADB said. Environmental infrastructure has failed to keep up with the region’s rapidly growing economy, and only 34 percent of urban wastewater in the area is being treated, despite water shortages. The project will build sewers, pump stations and treatment centers to increase collection and treatment of urban wastewater to more than 70 percent, the ADB said. The total project cost is about 0 million, half of which will be met by the ADB loan. Local bank co-financing will provide .2 million and central and local government funds will be used for the remaining .8 million. The project should be finished by the end of 2010, the bank said.

TAIPEI (XFN-Asia) — Over eighty percent of Taiwan’s manufacturers that invested abroad last year put their money in China, a government survey shows. Of all manufacturers who invested overseas in 2005, 81.18 percent chose China as a destination, up from 72.90 percent in 2002, according to a survey conducted by the Ministry of Economic Affairs (MoEA). Respondents were allowed to make multiple choices in the survey as their investments might be in more than one location, the MoEA said. In 2005, some 17.01 percent of outbound manufacturers invested in the US, little changed from 17.14 percent in 2002. Another 15.42 percent invested in the ASEAN (Association of Southeast Asian Nations) region, down from 18.62 percent three years earlier.