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Good food, good company, and good times

WHEN catching up with family and friends, most prefer to go out and dine to reminisce about past experiences and talk about how things are going. Nothing beats heart-to-heart talks paired with delightful meals.

In 2015, The Menu Group opened Sobremesa’s first branch at the Sapphire Block in Ortigas Center, Pasig City. The restaurant then served South American cuisine. With the opening of its third branch at the Edsa Shangri-la Plaza, Sobremesa — which means “conversations over meals” in Spanish — rebranded and now offers mainly Spanish and European dishes.

“We used to offer South American dishes. We shifted with a Spanish menu. At the same time, we centered [our concept for] the titos and titas (of the ’90s),” The Menu Group President Harvard Uy de Baron told BusinessWorld prior to the launch on April 24, referring to “uncles” and “aunts” as those born from 1975 to 1990. “These are the people who embraced the ’90s,” he said.

Mr. Uy de Baron added that their team ran a survey targeted at that demographic, asking what dishes they preferred when dining out and catching up with friends. He said that most preferred Spanish dishes.

The team decided to reestablish the restaurant as a place where people can enjoy each other’s company while reminiscing over equally loved dishes and timeless favorites. So the new branch, with its brick walls, hanging yellow lights, and posters of TV shows, boy bands, and old gadgets, exudes a cozy 1990s vibe. It seats 80 customers.

DIG IN
During the press launch, the signature dishes were served — some of which were named after the restaurant’s founders.

We had Sobremesa sangria bread and prosciutto and melon salad to start. It was followed by main courses: the arroz negra (black rice) which had a pinch of pleasant sourness (the downside is that the squid ink stains your teeth black); Tito Harvard’s osso buco, the Sobremesa chicken and steak combo, and Tito Lance’s crusted salmon. For dessert, Tito Augusto’s mango coconut and almond cheesecake and salted caramel and banana cheesecake were served.

To complete the meal, we had a glass of sangria (available in alcoholic and virgin variety). At 5 p.m. onwards daily, the restaurant offers unlimited sangria for free with complimentary homemade bread.

“Here at Sobremesa, we embrace the value of preparing a warm atmosphere that leads you to hang out with ease over classic, heart-warming, and well-cooked Spanish and European dishes,” chef Benjo Tuason was quoted as saying in a press release.

The restaurant also offers a variety of promos. Happy Hour, Every Hour begins daily at 5 p.m. onwards, except on Wednesdays which is Titos and Titas Day, with a 16% discount given to customers who were born between 1975 and 1990. The Shangri-la branch also offers Unlimited Tapas every Saturday for P450.

“Our food is Spanish with Filipino favors. We’re not claiming to be [an] authentic Spanish [restaurant], but it’s aligned to the Filipino palate,” Mr. Uy de Baron said.

Sobremesa is located at Level 4, East Atrium at Edsa Shangri-la Plaza (958-6452, 0917-125-3169) and at the ground floor, Sapphire Bloc, at Sapphire Road, Ortigas Center, Pasig City (534-5821, 0917-624-5470). For more information, visit www.themenugroup.com/sobremesa. — Michelle Anne P. Soliman

Bubble tea fuels Grab’s food delivery business

THE craving for bubble tea is fueling Grab’s food delivery business as it said the number of orders for the sugary drink in the Philippines grew 3,500% from June to December last year.

GrabFood said in a statement the demand for bubble tea is not unique to the Philippines, as the trend is observed in the rest of its operations in Southeast Asia, namely in Indonesia, Thailand, Vietnam, Singapore and Malaysia.

“On average, Southeast Asians drink four cups of bubble tea per person per month on GrabFood. Thai consumers top the regional average by two cups, consuming about six cups of bubble tea per person per month. This is closely followed by Filipino consumers who drink an average of five cups per person per month,” it said.

It noted the food delivery service already has almost 4,000 bubble tea outlets linked to its platform, which includes more than 1,5000 brands in Southeast Asia. Among its top merchants, it said, are Chatime, Coco Fresh Tea & Juice, Macao Imperial Tea, Cafe Amazon, Gong Cha and Serenitea.

The data also found that most of the orders for bubble tea on GrabFood were made during lunch time, or at around 12 p.m. to 2 p.m. The second most popular time of day for a bubble tea fix is in the afternoon, or between 3 p.m. to 4 p.m.

“Across Southeast Asia, GrabFood’s data reveals that most people order bubble tea to accompany their meals at lunch, or as a perfect midday energizer,” it said.

In terms of flavors, Filipinos mostly order cheese-flavored bubble tea, followed by milk tea with pearl, winter-melon, pandan and chocolate. These drinks are usually paired with pearls, which landed the top spot in the list of most popular bubble tea toppings across GrabFood’s Southeast Asia operations, except in Vietnam.

GrabFood started its operations in the Philippines in June last year. — Denise A. Valdez

PAGCOR income up in Q1

THE PHILIPPINE Amusement and Gaming Corp. (PAGCOR) booked a higher net income in the first quarter as earnings from gaming operations increased despite higher expenses, its income statement showed.

PAGCOR’s net income rose 9.51% to P1.55 billion in the first three months from P1.42 billion in the same quarter of the previous year and well above its P1.25-billion goal.

Total income from gaming operations went up 15.62% year on year to P18.27 billion in the period from P15.8 billion the previous year. This is also 10.11% higher than the P16.29-billion target for the quarter.

Net of gaming taxes and contributions which rose 15.62% year on year to P9.59 billion, PAGCOR’s total gaming income for the quarter was at P8.68 billion, higher than the previous year’s P7.88 billion.

Meanwhile, total income net of gaming taxes and contributions, which includes earnings from other sources and related services, reached P9.69 billion during the first three months of the year, higher by 14.71% from the P8.45 billion booked in the comparable period in 2018.

The increase in PAGCOR’s net income in the first quarter came despite higher expenses. Total expenses for the period amounted to P8.14 billion, climbing 15.76% from the P7.03 billion booked in the same quarter last year, its income statement showed. — RJNI

Renowned chefs revive Sinatra’s hangout — but only for two years

AN ICONIC Los Angeles restaurant made famous as Frank Sinatra’s hangout is getting a dream revival. The catch? You have only two years to check it out.

Restaurateurs Hans Rockenwagner and Josiah Citrin are rebooting Culver City, Calif., eatery Dear John’s with updated American fare. But when their lease expires, the building will be razed to make way for new development.

“We saw the potential to have some fun,” says Mr. Rockenwagner, characterizing the space as a time capsule. “There’s such a nostalgia about the place.” The two are acting as the final caretakers of the spot, which served as Hollywood’s hottest watering hole in the ’60s. Actor Johnny Harlowe originally opened it in 1962, reportedly with money from Ol’ Blue Eyes.

Messrs. Rockenwagner and Citrin are staying true to the restaurant’s traditional chop house roots, with a menu featuring steaks, sand dabs (a type of fish), chicken parmesan, and iceberg wedge salads, along with old-school cocktails named for people and songs of the Rat Pack era. “There’s certain touches to it that you can certainly sense that it’s an updated version, but it doesn’t sway too far from the classic,” Mr. Rockenwagner says.

Mr. Citrin hopes the spot can serve as a refreshing break from the constant innovation and trend-chasing in the LA restaurant scene.

“It’s so different from everything else going on,” he says, noting that creating the menu was the easiest and most fun part of the revival; he and Mr. Rockenwagner wrote it the first day they decided to team up. “We’re not trying to do food that is mixing cultures and flavors. We’re just going back to the classic American food, but then using great California produce and meat.”

There’ll be a classic Caesar salad tossed tableside ($24) and creamed corn and spinach served as sides ($9 each), along with sirloins, filets, and a 16-ounce prime New York strip steak for $54. Mr. Rockenwagner’s baked goods — breads, crackers, desserts — will have a prominent place, too. Cocktails are a bit more modern, including the “Hemingway,” with rum, grapefruit, maraschino, and lime, and the “I Get a Kick Out of You,” made with tequila, jalapeño, hibiscus passionfruit, and chartreuse.

BRINGING IT BACK
Mr. Rockenwagner wasn’t interested in doing a ’60s throwback when he was first offered the space by a friend who knows the owner. He changed his mind after he and his wife Patti, an entertainment exec and partner in the endeavor, toured the eatery — located only five minutes from their house — and saw its potential. Plus, he says, it was the perfect chance to team up with Mr. Citrin, an LA dining scene veteran and owner of Santa Monica’s highly acclaimed Mélisse and Charcoal Venice.

Getting the spot back in shape required minimal cosmetic tweaks to remove neon signage from the previous tenant, a mezcal-and-shrimp-taco joint named Lucky’s. (The original red-and-white Dear John’s sign had been left intact out of respect.) To restore the ambience of the original restaurant, Patti Rockenwagner curated about 80 pieces of original 1950s and ’60s artwork from the collection of area gallerist Robert Berman — a mixture of portraits, abstract images, and scenery in deep, rich color. New, waist-high partitions give the tables the privacy of booths without taking up much space.

Dear John’s officially opened to the public Tuesday evening after a test run on Monday with friends and family, including a lineup of celebrities such as Jamie Lee Curtis, Jodie Foster, Jennifer Grey, and Grey’s husband Clark Gregg, who’s shooting the latest Marvel series installment a mile away in Culver City. Ms. Curtis even recorded Dear John’s voicemail greeting.

As for live entertainment, the owners are still figuring out the best configuration for the space, but they have a corner with piano and microphone ready for action. In the place’s heyday, Mr. Sinatra was known to play occasionally, and such famous friends as Gregg Allman, Chad Everett, and Barbra Streisand would stop in.

Hotelier and restauranteur Jeff Klein, known for the Sunset Tower Hotel on Sunset Strip, says he thinks Dear John’s will thrive in the city’s restaurant scene since there are so few old-school spots left. Still, the two-year window does seem short.

“I’m so impressed that the restaurateurs want to go to all this trouble for something that I don’t think will generate a large return for them financially,” he says. “They’re basically giving a gift.”

Messrs. Rockenwagner and Citrin think the venture is worth the trouble: They got a low rent, compared to market value; there were few overhead costs since they didn’t need to do any construction work; and Dear John’s has a grandfathered liquor license. In addition, the space is small, so they didn’t need to hire much staff. Patti Rockenwagner says she thinks the place can be profitable if they budget well.

The two-year timeline does come with some advantages.

“In hindsight, it’s kind of marketing genius,” Mr. Rockenwagner says. “It makes people want it more.” — Bloomberg

‘Rare’ wave of hiring talent hits Hong Kong as virtual banks beef up

HONG KONG’S banking sector, one of the most staid areas of its financial industry, is seeing an unusual spurt of recruitment as newly licensed virtual banks race to snap up talent.

Four ventures that won permits have about 200 people in the city, which may more than double by the time they start operating, said Carol Cheung, a director at headhunter Robert Walters Plc. The Hong Kong Monetary Authority expects the virtual banks to begin offering retail and commercial services within nine months and is processing four more applications.

“How often do you see Hong Kong’s most regulated banking industry create something totally new?” said Cheung. “This wave of hiring is rare.”

While firms including Robert Walters are on the lookout for everyone from business chiefs to operational staff, finding the right skill set may prove challenging. Though crowned as a financial hub and boasting a banking sector that steadily employs some 100,000 people, Hong Kong has relied on a clutch of traditional lenders and is behind regional economies in financial technology.

“There’s already a lack of fintech talent in Hong Kong’s banking industry as not every banking practitioner is a good fit,” said Simon Loong, founder of WeLab Holdings Ltd., which was granted a license earlier this month. “Some bankers who are experienced in doing traditional sales may not be suitable for fintech-driven services.”

Headhunters are looking for system developers and risk and compliance officers, among others. They said salaries may not be extravagant because virtual banks will operate like fintech startups, but the new businesses could attract staff by offering share options.

Some firms are looking beyond the city for recruits. While almost 70% of employees at SC Digital Solutions Ltd., controlled by Standard Chartered, are from Hong Kong, it has hired from technology firms and digital banks in North America, Europe, China and Australia, said Samir Subberwal, a director on the virtual bank’s board.

“There is a bit of tightness in terms of getting the right amount of talent in Hong Kong,” Subberwal said. “That’s why we’re hiring globally.” — Bloomberg

Hortaleza to focus on food business after Splash sale

By Arra B. Francia, Senior Reporter

BUSINESSMAN Rolando B. Hortaleza aims to grow the sales of his food business to P1.5 billion by next year, as he now has more time to focus on the venture following the sale of his personal care company.

Prime Global Corp., Mr. Hortaleza’s new firm that will hold his investments in food, generated P400 million in sales in 2018. This is seen to more than double to P900 million by the end of the year.

“Busy ako sa (personal care) kaya hindi ako naka-focus sa pag-expand ng food… Ngayon pupunta tayo sa commodity market (I was busy with my personal care business so I wasn’t able to focus on expanding food… Now we will go to the commodity market),” Mr. Hortaleza told reporters in an interview on April 29.

Prime Global sells shrimp paste, peanut butter, chicken breading, and other condiments. Mr. Hortaleza said shrimp paste carrying the Barrio Fiesta brand was the firm’s largest growth driver last year, accounting for about 70% of sales.

Mr. Hortaleza noted how 60% of the Barrio Fiesta shrimp paste sales were domestic, while 40% came from international market.

“When I bought Barrio Fiesta, 70% was international. But the idea of growing it, the growth should be coming from the domestic market…We are targeting 80-20 (domestic-international),” he explained.

Mr. Hortaleza said they can achieve the 80-20 target within the next two years.

Prime Global will also be launching three new products this year to further boost sales. These products will be in the high margin category.

Mr. Hortaleza’s food business used to account for only 10% of the sales of Splash Corp., as majority came from the sale of personal care products. This segment, which housed homegrown brands such as Maxi-Peel, Skinwhite, and Vitress, was recently sold to Bangalore-based firm Wipro Consumer Care (WCC) for about P9-11 billion.

WCC’s portfolio includes soaps, toiletries, personal care products, wellness products, electrical wire devices, domestic and commercial lighting, and modular office furniture. It has a presence in the Philippines through perfume brand Enchanteur, which it noted is a market leader in Malaysia, Vietnam, China, and Hong Kong, among others.

Mr. Hortaleza said the transaction will allow Splash to accelerate its expansion in international markets, leveraging on WCC’s footprint to 60 countries, including the Middle East, North African region, and the United Kingdom.

WCC expects Splash to continue its double-digit growth momentum in terms of revenues in the following years, as they aim to achieve synergies in research and new product development, among others.

Liquidity growth slows further in March as loan demand drops

MONEY SUPPLY growth further eased in March to post the slowest pace in over six years, with demand for loans also slowing following the central bank’s tighter monetary policy, the Bangko Sentral ng Pilipinas (BSP) reported late Tuesday.

Domestic liquidity or M3, considered as the broadest measure of money in an economy, grew 4.2% year-on-year to about P11.4 trillion in March, slower than the 7.1% expansion in February and 7.6% growth in January. This pace is also the slowest recorded since September 2012.

The BSP noted that money supply decreased by 1% compared to the previous month.

“Demand for credit eased but remained the principal driver of money supply growth,” the central bank said in a statement.

Net claims on the central government contracted by 2.2% after posting a 8.3% climb the previous month.

Meanwhile, domestic claims grew at a slower pace of 7.3% in March from 11.7% in February due to sustained growth in credit to the private sector.

On the other hand, net foreign assets (NFA) expressed in the peso terms expanded by 2% year-on-year after posting a decline of 1.5% in February, on the back of strong remittances from overseas Filipino workers and business process outsourcing receipts.

By contrast, the NFA of banks declined as their foreign liabilities increased due to higher placements and deposits made by offshore banks with their local branches and other lenders.

Amid a decline in domestic liquidity, analysts from First Metro Investment Corp. and the University of Asia & the Pacific said in the latest issue of The Market Call that they expect the central bank to cut big banks’ reserve ratio requirement (RRR) this quarter.

“With M3 growth expected to average 7.1% in the first four months of 2019, the case for a cut in reserve requirements becomes even more compelling,” the report read.

BSP Governor Benjamin E. Diokno earlier signaled a possible cut in policy rates and reduction in big banks’ RRR. However, the central bank’s policy-setting Monetary Board (MB) at its March meeting kept key rates steady and left RRR untouched, noting the need to be cautious despite easing inflation.

“We, however, think that with inflation continuing to trend downward much within BSP’s target range and slow monetary expansion, we maintain our view that the MB will likely provide more liquidity to banks by cutting reserve requirements in H1-2019 and also reduce policy rates in H2. These should bolster sustained growth in the economy,” the analysts said.

In an email, ING Bank N.V.-Manila Branch Senior Economist Nicholas Antonio T. Mapa said he expects big banks’ RRR to be reduced by 100 bps in the near term and 200 bps in total for the year.

LENDING GROWTH SLOWS
Meanwhile, bank lending growth also slowed in March on softer demand from the household sector.

Outstanding loans increased by 9.9% year-on-year in March, slower than the 13.7% pace logged the previous month. Inclusive of reserve repurchase agreements (RRP), bank lending growth decelerated to 9.3% from 13.9% in February.

Production loans accounted for the bulk of the credit at 89.5% even as growth slowed to 11.4% in March from 13.6% the previous month.

Construction loans booked the highest increase at 41.7%, followed by financial and insurance activities at 32.7%; wholesale and retail trade, repair of motor vehicles and motorcycles at 11.6%; manufacturing at 10.6%; electricity, gas, steam and airconditioning supply at 9.4%; and real estate activities at 8.7%.

Loans for household consumption declined by 5.8% in March, a reversal of the 14.9% increase in February, BSP data showed, dragged by softer demand for credit card loans and year-on-year decreases in motor vehicle loans, salary-based general purpose consumption loans, and other types of household loans during the month.

“Going forward, the BSP will continue to ensure that the expansion in domestic credit and liquidity proceeds in line with overall economic growth while remaining consistent with the BSP’s price and financial stability objectives,” the central bank said. — R.J.N. Ignacio

Zoho’s Commerce Plus platform to help small businesses in branding

ZOHO CORP. has launched a software that could help small businesses develop their own branding while easing tasks.

Gibu Mathew, vice president and general manager of Asia Pacific of Zoho, said Commerce Plus will allow small business owners to manage all tasks on their own and maintain inventory in several other platforms.

“E-commerce has very specialized vendors, specialized in the sense of having only payment processing or logistics, or online shopping, so we came up with a solution which includes all these 40 products tailored for e-commerce, which are vertical,” he told BusinessWorld in a recent interview.

“Commerce Plus platform that is something a small business could put their goods online and have an online footprint,” he said.

Zoho is an India-based software company founded in 1996 which focuses on developing web-based business tools and IT solutions like office tools suites, Internet of Things management platforms and a suite of IT management software.

The Commerce Plus platform brings more than 40 Zoho products together for sales and marketing, finance, email and collaboration, IT and help desk, human resources, and custom solutions, allowing the owner to do all tasks by himself.

Moreover, this may also serve as a backup store for the owner in case his store in another platform will be knocked out due to changes in policies or shutdown.

Notably, since small businesses tend to be on online platforms with other small stores, branding is most of the time neglected. Through this platform, business owners can have their own website and even create their own storefront.

“Many times, small businesses miss out on one thing: they lose out in their own branding, so when you go and sell on other platforms, you don’t have your own brand…but you are doing all the hard work, so that is when a small business should have its own branded store,” he explained.

“Once you go online, when you start having your platform to take care of all these aspects, it becomes more powerful, and that is the unique selling point of the Zoho Commerce Plus Platform,” he noted.

Business owners can also personalize the store according to what they want and according to the market where they are in. As an example, Mr. Mathew said if a business sells in multiple countries, the owner can set the products to be featured in the store depending on the location.

This will cost companies $20 per month. Interested companies can avail of the software through the company’s website. — Vincent Mariel P. Galang

The art of cutting jamón

THE perfect slice of jamón is paper thin, approximately the size of a credit card, with a combination of fat and lean meat.

IN EVERY bit of product that comes out of a country, a bit of the country’s soul is in there, and where there is soul, there is art. Spain’s jamón (ham) contains the nation’s animal, fungi, and weather conditions, and for these to be expressed, it needs an artist — the maestro cortador.

The maestro cortador is essentially a meat carver, but like a sculptor, he has to know his medium with intimacy. Michael Lopez, a Filipino maestro cortador, presented his ham-cutting skills at a talk last week in Makati.

Mr. Lopez first worked as a waiter in Restaurante Cinco Jotas in Madrid, but got the attention of the establishment’s cortador in 2000. With his brother Mark, they worked together in the restaurant in 2002. The pair received their certifications in 2003, and then 2007 for the younger Mr. Lopez.

The pair now run their own business, called Maestro Cortador Filipino. Their services include sourcing jamón from Spain, and carving a jamón for restaurants (to be vacuum-sealed), or else carved live at an event.

Hiring a man like Mr. Lopez is a luxury (his basic service is P10,000, exclusive of the price of the ham, which, depending on the kind, goes up to the thousands per kilogram), but then a man like him can save one money on luxury — cut badly, a huge percentage of the jamón (bone, fat, and skin) is wasted. Mr. Lopez makes sure that a customer gets every inch of their money’s worth.

“For jamón to be fully enjoyed, a slice should have a blend of lean meat and fat. Ideally, it should be approximately the size of a credit card, and, of course, paper thin. During some of our outdoor events, the jamón slices are so thin that they get blown away by the wind,” he said. Speaking of luxury, among the people for whom Mr. Lopez has served jamón is Hollywood actress Penelope Cruz.

We try not to exaggerate when we call Mr. Lopez an artist, but what else can you call a man who treats his cured meats this way?

Demonstrating how to cut a jamón, he took out a knife, and began sliding it down the leg: “Just like you’re playing a violin,” he said, telling us to move the knife, and not just push it down on the ham leg.

He gave tips on how to spot a good ham, just based on sight. For example, the leg of a pureblood jamón Iberico de bellota, acorn-fed and free range, should have black hooves: he joked, not from a pedicure. The ankles and hooves on this purebred pig, protected by EU regulations, should be thinner.

They sell other kinds of hams, of course, such as jamón Serrano, and jamón Iberico de sebo (not a purebred bellota pig), but of course, working with a bellota is a source of pride.

“The supply of jamón Ibérico de bellota is limited because the availability is also dependent on the weather — if it doesn’t rain and acorns don’t grow, then they cannot produce the jamón. Its taste is an intense nutty flavor, it is sweet and salty like buttered almond. And it lingers in the mouth,” he said.

To contact Mr. Lopez, send an e-mail to michael@maestrocortadorfilipino.com or a message via Viber/WhatsApp to (0908-939-0499). Maestro Cortador Filipino is also on social media, @MCFmaestrocortadorfilipino on Facebook, @maestrocortadorfilipino on Instagram, @maestrocortador on Twitter, and Maestro Cortador Filipino on YouTube. — Joseph L. Garcia

Lenovo launches new gaming devices

HONG KONG-based technology firm Lenovo will start offering new gaming devices under its Legion brand this month.

The company said a total of four new devices will be made available starting May 11, and through authorized resellers starting June. These products, Lenovo said, are equipped with updated hardware from technology manufacturer Intel Corp. and computer game firm NVIDIA Corp.

The four new Legion devices are Legion Y740, Legion Y540, IdeaPad L340 Gaming and Legion T530.

The 9th generation processor from Intel is expected to perform video editing 34% faster than the previous generation and can run games with a faster frame rate of 10% more frames per second.

The GTX 16 series of NVIDIA is seen boosting the devices’ power efficiency by 1.4 times versus the previous generation. This will enable users to stream high-quality videos as the technology will have dedicated hardware encoders. NVIDIA is also offering its RTX 2060 graphics card for the new Legion devices, which could deliver better graphics as it performs six times better than the previous generation cards.

“The boost catered by Intel and NVIDIA will surely help produce popular content since they not only provide the power needed to play new and upcoming games, which people want to see, but also make the process a lot easier,” Lenovo Philippines General Manager Michael Ngan said in a statement.

“By providing the right tools, we at Lenovo are not only giving gamers the chance to play games, but we’re also giving non-gamers an opportunity to fully immerse themselves in a new environment,” he added.

The Legion Y740 is priced at P119,995, and will be equipped with an NVIDIA RTX 2060 graphics card and Intel Core i7-9750H processor.

The Legion Y540 would cost around P99,995 to P69,995, depending on the variant of choice that customers may select from three hardware and processor options.

The IdeaPad L340 Gaming is the cheapest of the four, which has a P59,995 variant with an NVIDIA GTX 1650 graphics card and Intel Core i7-9750H processor, and a P49,995 variant which has an NVIDIA GTX 1650 graphics card and Intel Core i5-9300H processor.

The Legion T530 is for desktop gamers, which is powered by an NVIDIA RTX 2060 graphics card and Intel Core i7-9700 processor for the price of P89,995.

“Thanks to the booming popularity of eSports and gaming in general, video game streaming has become very lucrative and we recognize that a lot of people want to get in on it,” Mr. Ngan said. — Denise A. Valdez

China’s new technology companies set to drive growth in country

CHINA’S new generation of companies, led by those in the technology sector, are driving much of the growth in the world’s second-largest economy, according to investors at the Milken Institute Global Conference.

Jin Qiu, managing director at China International Capital Corp., or CICC, the country’s top investment bank, said these technology companies are “very different” from established state-owned enterprises as well as private sector peers in other industries because they’ve received little financing from the nation’s finance and banking sector. They have instead turned to the likes of Japanese tech billionaire Masayoshi Son’s SoftBank Corp. and China’s IDG Capital for seed funding.

“They are very independent, nobody is too big to fail,” Qiu said Monday at the conference in Beverly Hills, California. He added that this had been enabled by a policy shift of Chinese President Xi Jinping’s administration to leave no one behind in the march toward common prosperity, from Deng Xiaoping’s infamous “cat theory” regarding capitalism.

ALIBABA, TENCENT
Chinese technology companies have also evolved — from a stage where they’ve “copied” innovations of US peers in the past to increasingly emerging on the forefront in areas such as mobile payments, biotechnology and 5G infrastructure, said Jason Tan, partner and chief investment officer of Jeneration Capital. A “pro-business” set of regulations with few antitrust restrictions have also allowed Alibaba Group Holding Ltd. and Tencent Holdings Ltd. to become giants.

China is expected to dwarf the US in mobile payments, according to data from Deloitte shown at the conference. In 2011, the volume of mobile payments in China rose to $15 billion — almost twice the $8 billion in the US Five years later, China’s figures jumped to $9 trillion compared with $112 billion in the US, and are expected to exponentially surge to $47 trillion by 2020, with the US trailing further behind at $283 billion, the data shows.

Changing attitudes and lifestyle of China’s younger population is also opening new avenues for landlords to develop different real estate offerings, said Goodwin Gaw, managing principal at Gaw Capital Partners. The younger population is becoming increasingly willing to rent, a departure from prioritizing investing in bricks and mortar with social taboos such as the concept of a “naked marriage” if a groom who is set to wed didn’t already own a home.

Gaw said his real estate investment firm has been focused on the concept of co-living, a practice in the US where students move from dormitory living to similar housing with shared spaces and a sense of community. He remains interested in property investments on the West Coast of the US, describing it as “the innovation capital of the world.”

To tap on the changing trends in China, TPG Capital Asia’s Co-Head Tim Dattels expects cruises, hotels, real estate and restaurants to be the key beneficiaries from the heightened spending power of Chinese tourists in the rest of the world. — Bloomberg

RCBC innovation head to push ‘sachet banking’

By Karl Angelo N. Vidal, Reporter

FORMER financial technology (fintech) firm head and now Rizal Commercial Banking Corp. (RCBC) Chief Innovation and Inclusion Officer Angelito “Lito” M. Villanueva eyes to continue his “sachet banking” push to include more unbanked Filipinos into the formal financial system.

In an interview, Mr. Villanueva said the Yuchengco-led lender will aggressively pursue banking services that will cater to market segments with deficient financial access.

“In RCBC, I will continue my sachet banking push. The priority is to roll out an integrated and inclusive digital finance products and services for the unbanked and undeserved,” Mr. Villanueva told BusinessWorld in a phone message on Wednesday.

With the intent of transitioning the unbanked to fully banked individuals, Mr. Villanueva said the initiative will cover the creation of basic deposit accounts with microinsurance coverage nationwide.

This would allow new-to-bank clients to establish a credit profile, exposing them to other banking products such as lending and investments.

“We will review, rationalize, and optimize all digital assets to promote omni-channel customer access,” he added, noting that the thrust will also cover key sectors such as small and medium enterprises as well as agriculture.

According to the latest Financial Inclusion Survey conducted by the Bangko Sentral ng Pilipinas in 2017, only 22.6% or some 15.8 million Filipino adults maintain formal bank accounts, citing lack of money and lack of need to have an account as the main reasons.

Mr. Villanueva took the post of innovation and inclusion head of RCBC effective May 1, months after leaving his managing director post at FINTQnologies Corp., the fintech arm of PLDT Group’s Voyager Innovations, Inc.

During his stint at FINTQ, he advocated for the “sachet banking” model, providing unbanked and underserved Filipinos access to financial services such as savings, loans, insurance and investments for as low as P20 through mobile and online channels.

Mr. Villanueva concurrently holds the position of chief digital transformation adviser for the entire Yuchengco Group of Companies — an appointment which took effect last April 22.

“The first order of the day is on how to accelerate the pace and impact of digital transformation across all businesses of the conglomerate,” Mr. Villanueva said. “This will be done by driving change towards creating a delightful customer experience and delivering enabling strategies and inclusive digital solutions achieving hyper-growth.”

“As digital technologies are fast reshaping all industries, Lito’s onboarding is a welcome development to the group as we all need to embrace these disruptions to compete and future-proof our businesses,” said Helen Y. Dee, RCBC and Yuchengco conglomerate chairperson.

Mr. Villanueva’s career spans two decades, previously holding key roles in Visa, the Economist Intelligence Unit and International Finance Corp. He is also the founding chairperson of Fintech Alliance Philippines, an industry group representing more than a third of the country’s registered fintech companies.

RCBC booked a steady net income of P4.3 billion in 2018, supported by increased lending across all segments.

RCBC shares stood at P26 apiece on Tuesday, up 40 centavos or 1.56% from the previous close.

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