Unilab at 80: Staying the Course, Shaping the Future of Filipino Healthcare
The country’s leading healthcare company sets its sights on innovation, local growth, and broader impact in the years ahead
Unilab Group, the country’s most-trusted pharmaceutical and healthcare conglomerate, marked its 80th year with a bold signal to the market: it is accelerating its transformation from a humble corner drugstore into a future-ready, innovation-driven healthcare leader.
Celebrating its founding anniversary at the PhilSports Arena, the milestone event gathered over 4,000 employees and partners across the Philippines and Southeast Asia. While the program featured a retrospective of Unilab’s growth and milestones, its main message focused squarely on accelerating momentum for the next 20 years as the company approaches its 100th year.
Founded in 1945 during the post-war recovery period, Unilab began as a small drugstore along Sto. Cristo Street in Binondo. Its founder, Jose Y. Campos, and his business partner, Mariano K. Tan, operated with limited capital, a borrowed corner space, and a single shelf for inventory. From those early days, the company grew steadily through hard work, resourcefulness, and a deep understanding of community needs.
That same entrepreneurial mindset continues to guide the organization today. From its origins in pharmaceutical distribution, Unilab Group invested strategically in building robust manufacturing capabilities to ensure quality, accessibility, and self-reliance in its product supply. Unilab has since evolved into a healthcare conglomerate with capabilities in branded and generic pharmaceuticals, personal care, health services, and animal health.
Clinton Campos Hess, who formally assumed the role of Group Chairman, outlined the company’s strategic vision for the next decade. This includes deepening its role as a key healthcare player in the region. He emphasized the need to align business growth with social responsibility, particularly in reaching underserved communities.
“We must ensure that in pursuing our mission, no one gets left behind,” Campos Hess said during his speech.
Campos Hess also outlined Unilab’s three key strategic pillars: Product Solutions, Health Services, and Education, which are expected to drive new business models, enhance consumer access to healthcare, and hold up broader societal goals.
Infrastructure investments have played a critical role in sustaining Unilab’s competitive edge. Over the past decade, the company established several advanced facilities such as the Amherst and Belmont plants, Beaute Et Sante Laboratories, Inc. (BESLI), South-Unilab Material Management Office (SUMMO), and First Pioneer Distribution, Inc. II (FPDI). These facilities enable high-volume production, quality assurance and control, and industry-compliant storage for specialized therapies including vaccines, oncology, and central nervous system treatments, a testament to Unilab’s commitment to deliver no less than high-quality medicines for the Filipinos.
In addition to business expansion, Unilab has pursued programs that reflect its community-oriented culture. Its 8,000 Hours of Bayanihan campaign encourages employees to collectively log volunteer hours that support health and wellness initiatives nationwide. The campaign reinforces a long-standing principle within the organization: that success is measured not only by financial performance, but by the lives touched along the way.
The group also reaffirmed its role in policy advocacy through the Unilab Center for Health Policy (UCHP). Formally launched last year, UCHP serves as a platform for research, dialogue, and multi-sectoral collaboration aimed at addressing systemic gaps in Philippine healthcare.
Much of Unilab’s progress over the past decades was credited to the leadership of Jocelyn Campos Hess, who formally stepped down and assumed the title of Chairman Emeritus. During her tenure, Unilab expanded its business lines, broadened manufacturing capabilities, and launched initiatives under the Unilab Foundation to support health education, inclusive employment, and therapeutic care for children.
Despite rising competition in both local and regional markets, Unilab has expressed confidence in the company’s direction. The challenge now, it said, is to scale operations while retaining the core values of husay, malasakit, and bayanihan that have long shaped its culture.
As Unilab looks ahead to its 100th year, the company is determined to balance growth with purpose. With its foundations firmly in place and leadership looking outward, Unilab is poised to reinforce its standing not only as an industry leader, but as a partner in working towards healthier Filipinos, one health solution at a time.
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Nvidia says US export controls on AI chips to China were ‘a failure’
TAIPEI – U.S. export controls on artificial intelligence chips to China were “a failure”, Nvidia Chief Executive Jensen Huang said on Wednesday.
The U.S. Commerce Department issued guidance last week alerting businesses to the risk of violating U.S. export controls by using Chinese chips.
Mr. Huang’s comments came after China on Monday urged the United States to “immediately correct its wrongdoings” and stop “discriminatory” measures following the U.S. guidance warning companies not to use advanced computer chips from China, including Huawei’s Ascend AI chips.
The U.S. action seriously undermined consensus reached at the high-level bilateral trade talks in Geneva, a statement from China’s commerce ministry said, vowing resolute measures if the U.S. continues to “substantially” harm China’s interests.
Mr. Huang, speaking at the annual Computex event in Taipei, said Nvidia’s market share in China dropped to 50% from 95% at the start of former U.S. President Joe Biden’s administration. – Reuters
Canada says G7 finance ministers to focus on restoring stability, growth
BANFF, Alberta – Finance ministers from the Group of Seven industrial democracies will try to agree on policies to restore global growth and stability, Canadian Finance Minister Francois-Philippe Champagne said on Tuesday, acknowledging that tensions over new U.S. tariffs would continue.
The meetings over the next two days in the mountain resort town of Banff, Alberta, will be about “back to basics” and will include discussions about excess manufacturing capacity, non-market practices and financial crimes, Champagne told a news conference. “I think to deliver for the citizens that we represent, our mission is really about restoring stability and growth,” Mr. Champagne said
He said discussions would take place within the G7 and bilaterally with U.S. Treasury Secretary Scott Bessent about the impact of President Donald Trump’s new tariffs on trading partners, and that there would always be tension around such issues.
“But at the same time, there’s a lot we can achieve together,” Champagne said. “There’s a lot that we are looking to coordinate, our actions, and really tackle some of the big issues around over-capacity, non-market practices and financial crimes.”
Mr. Bessent has sought to push G7 allies to more effectively confront China’s state-led, export-driven economic policies, arguing that this has led to excess manufacturing capacity that is flooding the world with cheap goods and threatening G7 and other market economies.
But G7 members Japan, Germany, France and Italy all face a potential doubling of reciprocal U.S. duties to 20% or more in early July. Britain negotiated a limited trade deal that leaves it saddled with 10% U.S. tariffs on most goods, and host Canada is still struggling with Trump’s separate 25% duty on many exports.
Champagne also said that the G7 group would discuss ways to better police low-value package shipments from China to combat smuggling. The Trump administration has ended a duty-free exemption for Chinese shipments valued under $800, which it has blamed for the trafficking of fentanyl and its precursor chemicals.
Reducing fentanyl trafficking is critical to lifting Trump’s 25% duties on some Canadian and Mexican goods, as well as a 20% duty on Chinese goods.
Champagne appeared with Ukrainian Finance Minister Serhii Marchenko and pledged to continue Canada’s support for Ukraine in its struggle against Russia’s invasion. He also said Canada is considering helping Ukraine build a Canadian-style pension system.
Marchenko told reporters that he would seek to reiterate Ukraine’s arguments for strengthening sanctions against Russia, including through lowering the level of the G7-led $60-per-barrel price cap imposed on Russian crude oil exports. – Reuters
Fed officials expect tariffs to boost prices; White House downplays risk
AMELIA ISLAND, Florida – Federal Reserve officials said on Tuesday that higher prices are coming on the back of rising U.S. import tariffs and counseled patience before making any interest rate decisions before it is clear whether the inflation shock will be fleeting or more persistent.
“One thing that we’ve heard is that a lot of the tariff impact to date has actually not shown up in the numbers yet. There’s been a lot of front-running, building inventories and all those sorts of things. And we are hearing from an increasing number of businesses that those strategies … are starting to run their course,” Atlanta Fed President Raphael Bostic said on the sidelines of a conference in Florida.
“If these pre-tariff strategies have run their course, we’re about to see some changes in prices, and then we’re going to learn how consumers are going to respond to that,” said Bostic, who now expects the U.S. central bank will have to wait longer for clarity about the economy’s direction and make any changes to interest rates.
“We should wait and see where the economy is going before we do anything definitive,” said Mr. Bostic, who anticipates only a single quarter-percentage-point cut in the Fed’s policy rate this year and several months on the sidelines waiting for the effect of Trump administration policies to become clear.
“I think the best action we can take is to sit on our hands and really carefully go through the data, engage with our communities, hear what they’re thinking about, hear about the choices that they’re making, and see how that all comes together,” Cleveland Fed President Beth Hammack said at an Atlanta Fed event. Her comments were echoed by San Francisco Fed President Mary Daly in a joint appearance.
So far the main impact appears to be in sentiment surveys showing households and businesses are less confident about the economic horizon and expect higher inflation.
In an interview on Bloomberg Television on Tuesday, Stephen Miran, who chairs the White House’s Council of Economic Advisers, pushed back on the idea that the tariffs imposed by the administration so far and potentially added in coming weeks would result in meaningful inflation.
“We have been introducing tariffs since day one of this administration,” Mr. Miran said, yet there has “been no real meaningful effect on inflation,” with recent consumer price index reports coming in weaker than expected.
But Fed officials and analysts say they expect the impact has just not filtered through yet to the economy.
Walmart WMT, the world’s largest retailer and a major importer of goods from China, said last week that price increases were on the way, comments that drew a rebuff from President Donald Trump.
“We can control what we can control,” Walmart CEO Doug McMillon said during the company’s quarterly earnings call. Even trimming the tariffs on Chinese goods to 30%, as the administration recently did in backing off a more exorbitant 145% levy, “will result in higher prices,” he said.
INFLATION EXPECTATIONS
The waiting game for Fed officials may prove a long one. The central bank has kept its policy rate in the current 4.25%-4.50% range since December, but says it will remain difficult to anticipate where the economy is heading until the tariff issue and other policies are settled for good – and enough time lapses after that to gauge the impact.
In comments to the Economic Club of Minnesota on Tuesday, St. Louis Fed President Alberto Musalem said the central bank needed to guard first and foremost against a rise in inflation expectations, and key to that effort will be assessing if coming price hikes seem like one-time increases or risk turning into something more persistent.
The tariff plans may have been scaled back, but still “seem likely to have a significant impact on the near-term economic outlook,” Mr. Musalem said, with “direct one-off effects on the prices of imported final goods, indirect effects on the prices of domestically produced goods and services, and possibly second-round effects on inflation.”
Deciding in advance that the effects will fade on their own, “runs the risk of underestimating the level and persistence,” and creating more inflation trouble in the future, he said. – Reuters
US intel suggests Israel preparing strike on Iran’s nuclear facilities, CNN reports
New intelligence obtained by the United States suggests that Israel is making preparations to strike Iranian nuclear facilities, CNN reported on Tuesday, citing multiple U.S. officials familiar with the intelligence.
It was not clear whether Israeli leaders have made a final decision and there was disagreement within the U.S. government about whether they would ultimately decide to carry out strikes, CNN added, citing the officials.
Reuters could not immediately confirm the report. The National Security Council did not immediately respond to a request for comment.
The Israeli Embassy in Washington did not immediately respond, nor did the Israeli Prime Minister’s Office, which was contacted after hours.
One source familiar with the intelligence told CNN the likelihood of an Israeli strike on an Iranian nuclear facility “has gone up significantly in recent months.”
The person added that the chance of a strike would be more likely if the U.S. reached a deal with Iran that did not remove all of the country’s uranium, CNN added.
President Donald Trump‘s administration has been conducting negotiations with Iran aimed at achieving a diplomatic deal over its nuclear program.
The new intelligence was based on the public and private communications from senior Israeli officials as well as intercepted Israeli communications and observations of Israeli military movements that could suggest an imminent strike, CNN reported.
CNN cited two sources saying that among the military preparations the U.S. had observed were the movement of air munitions and the completion of an air exercise.
Earlier on Tuesday, Iran’s Supreme Leader Ayatollah Ali Khamenei said U.S. demands that Tehran stop enriching uranium are “excessive and outrageous,” state media reported, voicing doubts over whether talks on a new nuclear deal will succeed. – Reuters
Philippines, U.S. hold joint maritime drills in South China Sea
MANILA – Coast Guard vessels of the Philippines and the United States have taken part for the first time in joint maritime exercises with naval and air force units in the contested South China Sea, Manila’s armed forces said on Wednesday.
The exercises, held on Tuesday in waters off Palawan and Occidental Mindoro, involved the Philippine Navy, Air Force, and Coast Guard, alongside the U.S. Coast Guard Cutter Stratton and a U.S. Navy P-8A Poseidon maritime patrol aircraft.
The “maritime cooperative activity,” which was the second for the year and sixth overall since the allies launched the joint activities in 2023, included communication drills and search-and-rescue scenarios, the military said in a statement.
“Joint activities like the MCA reaffirm the Armed Forces of the Philippines’ commitment to modernizing its capabilities and strengthening defense partnerships to secure our national and regional maritime interests,” AFP Chief Romeo Brawner said.
Relations between the Philippines and China have been strained by disputes over sovereignty in the South China Sea, a conduit for more than $3 trillion of annual ship-borne commerce.
China claims most of the strategic waterway despite a 2016 ruling by an international arbitral tribunal that found Beijing’s claims have no basis under international law. China does not recognize the decision. – Reuters
Real estate risks need closer scrutiny
EVEN as the Philippine banking system has remained resilient, the International Monetary Fund (IMF) said risks in the real estate sector and consumer credit still require closer monitoring and could prompt the central bank to intervene.
“Financial stability risks remain contained. The banking system has sufficient liquidity and capital buffers, and nonperforming loans (NPL) are low,” an IMF spokesperson told BusinessWorld in an e-mail.
Latest data from the Bangko Sentral ng Pilipinas (BSP) showed the banking industry’s NPL ratio eased to a three-month low of 3.3% in March.
“However, parts of the commercial real estate sector have seen persistently high vacancies and falling rents, and NPLs for housing loans remain elevated,” the IMF said.
Property consultant Colliers Philippines expects the vacancy rate for residential property in Metro Manila to hit 26% by yearend, while office vacancies are projected at 22% this year amid condominium oversupply and slow take-up of unsold units.
The BSP in its latest Financial Stability Report noted the “rising NPLs in the real estate sector.”
The NPL ratio for residential real estate was at 6.82%, while commercial real estate NPLs were 2.18% as of September 2024. The bulk (62.5%) of the real estate loan portfolio consists mostly of commercial loans.
The BSP also earlier said the mid- and low-cost housing segments, which account for a large part of residential real estate loans, have driven the rise in NPLs.
Consumer loans are also another area that the BSP needs to keep an eye on, the IMF said.
“The rapid growth in consumer credit, though a relatively small portion of banking assets, warrants close monitoring,” it said.
BSP data showed outstanding loans of universal and commercial banks rose by 11.8% to P13.19 trillion in March from a year ago.
Consumer loans to residents increased by 23.6% in March to P1.64 trillion, mainly due to the 28.8% jump in credit card loans to P959.43 billion.
The central bank must also be prepared to step in, when necessary, the multilateral institution said.
“The BSP should be ready to adjust macroprudential policy in line with developments in the financial cycle to preempt the buildup of vulnerabilities,” the IMF said.
In the same Financial Stability Report, the BSP said that the financial system’s real estate loan exposure will require “closer monitoring amid evolving market conditions.”
Banks’ real estate exposure ratio rose to 19.75% as of end-December from 19.55% at end-September.
This as total investments and loans extended by Philippine banks and trust departments to the real estate sector grew by 5% to P3.31 trillion as of end-December from P3.15 trillion in 2023.
The BSP monitors lenders’ exposure to the real estate industry as part of its mandate to maintain financial stability. — Luisa Maria Jacinta C. Jocson
DoF eyes at least $200M from CBK privatization
By Aubrey Rose A. Inosante, Reporter
THE DEPARTMENT of Finance (DoF) is looking to generate at least $200 million from the privatization of the Caliraya-Botocan-Kalayaan (CBK) hydroelectric power plant (HEPP) complex in Laguna.
“Pricing of CBK is anywhere from $200 million to $600 million (P11.14 billion to P33.43 billion) or higher depending on whether (Energy Regulatory Commission) will issue a price for the Kalayaan offtake,” Finance Undersecretary Catherine L. Fong told BusinessWorld in a Viber message.
The bidding price estimate came from the Asian Development Bank, the transaction advisor that helps the Power Sector Assets and Liabilities Management Corp. (PSALM) to monetize its asset.
Finance Secretary Ralph G. Recto earlier said CBK would likely generate at least P50 billion ($897.99 million).
PSALM is conducting a new bidding process for the 796.64-megawatt (MW) hydroelectric power plant complex, although it has yet to set a minimum bid price. The date for proposal submission is set for June 16.
Experts said the sale of the county’s only operational pumped-storage hydroelectric facility could depend on market appetite.
“Now for what the market is willing to pay is a different story and the beauty of open competition. NAIA (Ninoy Aquino International Airport) was a good example of the market willing to give more revenue share to government than expected,” Finance Assistant Secretary Michael Peter A. Alejandro said in a Viber message.
Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce said market appetite for renewable energy assets, regional energy demands, and interest rate environments will decide the feasibility of the bidding price.
“The $200 million to $600 million range appears reasonable if the plant offers solid financial performance, a favorable market outlook, and strategic value to potential buyers. However, these factors must align to achieve a price at the higher end of the estimate,” he said in a Viber message.
Meanwhile, John Paolo R. Rivera, a senior research fellow at the Philippine Institute for Development Studies, said the proceeds from the potential sale of CBK can help ease the National Government’s fiscal pressures amid a widening deficit.
The National Government’s budget deficit ballooned to P478.8 billion in the first quarter, higher by 75.62% from the P272.6-billion gap in the same period in 2024.
Mr. Rivera said proceeds from the sale of CBK plants would help generate much-needed revenues for the government’s infrastructure projects and social programs.
“Ultimately, the sale should balance three objectives: fiscal relief, operational efficiency, and alignment with the country’s clean energy roadmap,” he said in a Viber message on Tuesday.
Mr. Arce also noted firms that are looking to expand their renewable energy offerings could be interested in making a bid for the CBK complex. Investors seeking long-term results could also be keen on participating in the rebidding.
San Miguel Global Power Holdings Corp., Prime Infrastructure Capital, Inc. and Hexa Philippines Holdings, Inc. have earlier expressed interest in participating in the rebidding for the CBK plants.
CBK is currently under a 25-year build-rehabilitate-operate-transfer contract and power purchase agreement between CBK Power Co. Ltd. and National Power Corp. that ends in February 2026.
The facility includes the 39.37-MW Caliraya in Lumban, 22.91-MW Botocan HEPP in Majayjay, and 366-MW Kalayaan I and 368.36-MW Kalayaan II pump storage power plants in Laguna.
BusinessWorld reached out to the Energy Regulatory Commission for comment, but no reply has been received so far.
PRIVATIZATION EFFORTS
Separately, Ms. Fong said the DoF’s Privatization and Management Office (PMO) office supports the planned P45.8-billion initial public offering of the Pangilinan-led water concessionaire Maynilad Water Services, Inc.
“We’re supporting that because it has the potential to bring in foreign direct investment, and of course, we always support the capital market,” she said.
In addition, Ms. Fong said the PMO is currently in the process of selling the Ecology Villages in Makati City to the occupants.
“There’s no closed sale yet because we’re dealing with the homeowners as a group. It’s still a long process. We’re determining the metes and bounds, we need to subdivide the title, negotiate on the common areas, etc. But it’s an ongoing process. We’re closely focused on this,” Ms. Fong said in mixed English and Filipino.
In February, the privatization office published its revised guidelines for auctioning government assets which allows unsolicited bids, particularly for small properties.
Ms. Fong earlier told reporters that there are 28,000 titles in the database, which include properties as small as 200 square meters, making the acquisition process attractive to ordinary citizens.
Asked if the privatization goal is still pegged at P101 billion, she said the this is a “fluid number.”
“We’ll have more clarity later when the other revenues come in. I always just try to sell as much as I can,” she said.
She also noted that these idle assets incur maintenance costs without generating economic value for the government.
Philippines falls in global startup index for 4th year in a row
By Beatriz Marie D. Cruz, Reporter
THE PHILIPPINES dropped four spots in the 2025 Global Startup Ecosystem Index amid persistent gaps in infrastructure and regulations, according to global research firm StartupBlink.
In this year’s index, the Philippines slipped to 64th place out of 100 countries with a score of 2.237.
This was the fourth straight year of decline for the Philippines, which ranked 52nd in 2021, 57th in 2022, 59th in 2023 and 60th in 2024.
“The ecosystem growth of the Philippines is around 0.56% this year, and it’s being overtaken even by locations that are also decreasing in the rankings,” StartupBlink Head of Data & Consulting Ghers Fisman said in a virtual briefing on Tuesday.
The Philippines’ annual ecosystem growth rate was the lowest in Southeast Asia.
To increase the Philippines’ score, Mr. Fisman said the process of establishing a startup at the business level should be easier. He also noted the importance of faster and wider internet access for Philippine entrepreneurs.
The Global Startup Ecosystem Index evaluates startup ecosystems across 100 countries and 1,000 cities, using scores that assess the quantity and quality of startups and their existing business environment.
“The Philippines is making progress toward becoming a formidable startup ecosystem in the Asia-Pacific region,” StartupBlink said in the report.
The Philippines received total funding of $273.6 million (around P15.22 billion) last year, according to the report.
“The Philippines’ startup ecosystem is anchored by robust sectors such as fintech (financial technology), e-commerce, healthtech, edtech, and software-as-a-service. This diversification is propelled by a large digital consumer base and increasing regional demand,” it said.
StartupBlink noted the Philippines’ attractiveness to foreign entrepreneurs and digital nomads “should allow for successful ecosystem growth — provided more of the local population embraces entrepreneurship.”
The Philippines has six cities in the global top 1,000, led by Manila.
Manila ranked 112th globally, dropping 11 spots from the previous year. It also dropped to 6th place in Southeast Asia rankings and was the only city to see a decline.
“The Philippines’ startup scene remains centralized in Manila, whose ecosystem is twelve times larger than Cebu City’s. This gap has more than doubled since 2020,” StartupBlink said.
However, Manila had the lowest ecosystem annual growth rate among cities in the Philippines at 2.6%.
Cebu City fell 10 spots globally to rank 469th, with an annual growth rate of 9%.
Davao City rose 163 spots to 580th spot globally, as its startup ecosystem grew by 97.7% last year.
Cagayan de Oro and Naga climbed the global rankings at 693rd and 767th, respectively.
New entrants to the global rankings include Iloilo City (744th), Cauayan City, Isabela (1,040th), and Solana City in Cagayan (1,170th).
“The Philippines stands as Southeast Asia’s fastest-growing digital economy, reflecting a dynamic consumer market ripe for innovative startups,” StartupBlink said.
However, the Philippines faces several challenges that are hampering its development as a mature startup ecosystem.
“The lack of infrastructure is a limiting factor to the country’s economic growth, and entrepreneurs struggle with slow regulatory support for their startups,” it added.
John Paolo R. Rivera, senior research fellow at the Philippine Institute for Development Studies, said the country’s continued decline in the global startup rankings reflect structural gaps in the ecosystem.
“Improving our rank will depend not on isolated programs but on building a dynamic innovation ecosystem with strong interlinkages across the government, academe, industry, and startup founders themselves,” he said in a Viber message.
Key gaps in the local startup scene include poor early-stage funding support, uneven regional startup development, regulatory bottlenecks, and a “brain drain” of digital and entrepreneurial talent, Mr. Rivera said.
To address this, the Philippine government must adequately fund and fully implement the Philippine Startup Development Program, reduce bureaucratic red tape, and harmonize startup registrations and incentives, he added.
Venture capitalists and the private sector should also expand early-stage funding, mentorship, and link Filipino startups to global markets. Academic institutions can support student-founded ventures through incubation, intellectual property protection, and seed grants, Mr. Rivera said.
PHL banks’ profit up nearly 11% in first quarter
By Luisa Maria Jacinta C. Jocson, Senior Reporter
THE PHILIPPINE BANKING industry’s combined net earnings jumped by 10.6% in the first quarter as both interest and non-interest income rose, data from the Bangko Sentral ng Pilipinas (BSP) showed.
Central bank data showed the banking industry’s net profits climbed to P101.9 billion at end-March from P92.11 billion in the same period a year ago.
This as net interest income went up by 11.6% to P276.23 billion in the first three months from P247.41 billion in the same quarter in 2024.
Interest income increased by 11.1% to P395.99 billion in the first quarter from P356.43 billion a year ago, while interest expense rose by 9.6% to P119.32 billion at end-March from P108.86 billion last year.
Meanwhile, banks’ non-interest income stood at P60.67 billion in the January-March period, higher by 14.5% from P52.98 billion a year earlier.
Earnings from fees and commissions increased by 19.2% to P44.59 billion as of end-March from P37.42 billion a year ago.
However, trading income registered a net loss of P1.17 billion in the first quarter, a reversal of the P1.5-billion gain a year ago.
Lenders’ non-interest expenses rose by 13.1% to P191.01 billion in the period ending March from P168.95 billion year on year.
Meanwhile, the industry’s losses on financial assets widened to P29.83 billion in the first three months of 2025 from P21.81 billion a year ago. Provisions for credit losses likewise grew to P34.89 billion from P25.11 billion last year.
“Faster loan growth this 2025 relative to last year may have driven higher income growth for the banking industry this year,” Reinielle Matt M. Erece, an economist at Oikonomia Research and Advisory, Inc. said in a Viber message.
Latest data from the BSP showed bank lending rose by 11.8% year on year to P13.19 trillion in March.
“This increased the volume of products they were able to sell, i.e. financial products, as interest rates are expected to go down,” he added.
Alfred Benjamin R. Garcia, research head at AP Securities, Inc., said the higher profits are “partly volume-driven,” noting the growth in high-yielding consumer loans.
Earlier BSP data showed consumer loans to residents jumped by an annual 23.6% to P1.64 trillion in March.
“This helped keep net interest margins high even though interest rate levels are lower than where they were at the same time last year,” Mr. Garcia said.
The central bank began its easing cycle in August last year and has reduced borrowing costs by a total of 100 basis points (bps) so far, bringing the key rate to 5.5%.
The Monetary Board has delivered 25-bp rate cuts at each of its policy meetings in August, October, December last year and April this year.
Mr. Erece added that while lower interest rates reduce the margins of banks, it can also spur higher demand for financing services.
BANKING SYSTEM ASSETS
Separate BSP data showed the banking industry’s total assets amounted to P27.64 trillion as of end-March, higher by 7.8% from the P25.65 trillion in the same period in 2024.
Banks’ assets are mainly supported by deposits, loans, and investments. These include cash and due from banks as well as interbank loans receivable (IBL) and reverse repurchase (RRP), net of allowances for credit losses.
The banking sector’s total loan portfolio inclusive of IBL and RRP jumped by 14.5% to P15.14 trillion as of end-March from P13.22 trillion a year ago.
Net investments, or financial assets and equity investments in subsidiaries, increased by 12% year on year to P8.23 trillion.
Net real and other properties acquired stood at P119 billion, up 11.2% year on year.
Banks’ other assets went up by 1.9% to P2.06 trillion as of end-March.
On the other hand, cash and due from banks fell by 29% to P2.1 trillion at the end of the first quarter.
“The continued growth in banks’ total resources may still be largely attributed to the growth in loans and in investments,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
“Also supported by the continued growth in bank deposits that partly helped fund the growth in loans and investments,” he added.
Meanwhile, the total liabilities of the banking system grew by 7.4% to P24.18 trillion at end-March from P22.53 trillion a year earlier.
MGen nears halfway mark in P200-B MTerra solar project
MERALCO POWERGEN CORP. (MGen), the power generation subsidiary of Manila Electric Co. (Meralco), is nearly halfway toward the completion of the P200-billion MTerra Solar Power Project, with 700 megawatts-peak (MWp) of solar panels targeted for installation by end-July, its president said.
“Probably around 44 to 45% completion,” MGen President and Chief Executive Officer Manuel V. Rubio told reporters on the sidelines of Schneider Electric Innovation Day Philippines 2025 on Tuesday.
Mr. Rubio was referring to the status of what is expected to be the world’s largest integrated solar photovoltaic and battery energy storage system (BESS) facility.
Spanning over 3,500 hectares across Nueva Ecija and Bulacan, MTerra Solar is developing a 3,500-MWp solar power plant and a 4,500-megawatt-hour (MWh) energy storage system.
Mr. Rubio said the company is on track to complete the first phase of the project by the first quarter of 2026.
MGen has already installed 90-100 MWp of solar panels.
Once operational, MTerra Solar will supply clean electricity to approximately 2.4 million households and displace an estimated 4.3 million tons of carbon dioxide per year.
For the planned MTerra Solar 2, Mr. Rubio said the company will execute the project once it secures the necessary land.
Mr. Rubio said MGen is also looking to develop up to a 40-MWh BESS in Cardona, Cebu.
The project is targeted to be operational by the third quarter of 2026.
With MGen’s pipeline projects, the company is expected to surpass its goal of 1,500 MW of renewable energy capacity by 2030.
Meanwhile, Mr. Rubio said MGen has held initial talks with energy solutions company Schneider Electric to integrate predictive analytics and distributed control systems into its coal plant units that are more than 10 years old.
“But I think one of the major opportunities is to actually use AI (artificial intelligence) in how we operate the Terra Solar 1,” he said.
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera
Innovative financing seen to boost PHL just energy transition
By Ashley Erika O. Jose, Reporter
CLIMATE SMART VENTURES Pte. Ltd. is optimistic that the Philippines can meet — and potentially exceed — its just energy transition goals through innovative financing mechanisms and stronger corporate commitments to sustainability.
“We were founded at the height of the pandemic, basically as a response to figure out ways to accelerate the shift from fossil fuels to renewables,” Climate Smart Ventures Founder and Managing Partner Lawrence Ang said in an interview with BusinessWorld.
Established in 2020, Climate Smart Ventures is a transition and transaction advisory firm assisting energy companies in Asia in decarbonizing their operations. It provides strategic guidance on financial mechanisms and transition pathways, including the development of environmental, social, and governance (ESG) policies and decarbonization roadmaps.
The firm currently operates in the Philippines, Vietnam, Singapore, Indonesia, and India.
“In emerging markets like Asia, coal is something you love to hate and hate to love. We realized that we need to do this in a just, managed, but also commercially viable way,” Mr. Ang said.
He said Climate Smart Ventures supports companies in designing business models that enable a transition from coal to renewable sources, while taking into account prevailing market conditions and regulatory structures.
“Particularly, how power purchase agreements are structured. You still have to find ways to work with that. Understanding increasing demand for power in these different jurisdictions and also understanding how financing can be used as a tool and other capital market solutions,” he said.
Some local energy firms are also exploring opportunities under a memorandum of understanding signed by the Philippines and Singapore in 2023, which seeks to jointly develop carbon credit mechanisms under Article 6 of the Paris Agreement.
The accord aims to help both countries meet their climate goals by promoting carbon markets and exchanging best practices.
The Paris Agreement commits signatories to limit the rise in global temperatures to well below 2°C from pre-industrial levels, with efforts to keep the increase below 1.5°C.
Transition credits are one example of financing mechanisms being considered. These instruments leverage carbon finance to accelerate the retirement of fossil-fuel assets and their replacement with clean energy, while promoting a just transition.
The Philippines aims to raise the share of renewable energy in its power generation mix to 35% by 2030 and to 50% by 2040. Fossil fuels continue to dominate the current energy mix.
“It is also worth recognizing that these power plant owners have ambitions to decarbonize,” Mr. Ang said. “The target is probably achievable and can even be surpassed with the right mechanism in place.”
“We help them execute a transaction that is feasible. We then come up with the correct financing structure and frameworks,” he added.
Mr. Ang said Philippine energy companies are showing greater willingness to adopt transition tools and shift to clean energy technologies.
“I think you’d be hard-pressed to find companies who aren’t committing to some kind of decarbonization. If you look at all the big companies in the Philippines, at least the big ones, the ones that are driving the power market, everyone is committed to some kind of a net-zero or a clean energy target,” he said.
He also cited the Philippines’ move to open the renewable energy sector to full foreign ownership as a major draw for global investors.
“This kind of policy openness is crucial to attracting capital and technology that will help the country meet its clean energy goals,” he said.