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EastWest Bank earnings rise 36% in first quarter

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EAST WEST Banking Corp. booked a higher net income in the first quarter. — BW FILE PHOTO

EAST WEST Banking Corp. (EastWest Bank) booked a 36% increase in net income in the first quarter on the back of improved lending and trading gains.

In a disclosure to the Philippine Stock Exchange on Wednesday, EastWest Bank said its net profit grew 36% year-on-year to P1.3 billion in the first quarter from P945 million in the same period last year.

The bank’s first quarter income translated to a return on equity of 12%.

EastWest Bank attributed the increase in its income to “the resumption of its rural bank subsidiary’s DepEd (Department of Education) loan program, improved trading income, and lower credit costs.”

The lender’s revenues rose by 13.3% to P6.6 billion in the first quarter from P5.8 billion in the same period last year, primarily driven by fees and commissions growing by 29% to P1.3 billion. Securities and foreign exchange trading gains stood at P525.1 million, a reversal of the loss worth P136.5 million in the comparable year-ago period.

Interest income increased by 19% to P7 billion. EastWest Bank said around 50% or P516.1 million of the increase in interest income was accounted for by the rise in consumer loans.

Total gross loans grew 12% to P249 billion on the back of strong performances from both consumer and business loans.

EastWest Bank said consumer lending, which made up 71% of its loan portfolio, grew by 10% to P177.5 billion in the first three months from P161.3 billion last year.

Corporate or middle-market business loans also increased by 19% to P71.6 billion from P60.2 billion in the same period a year ago.

Interest expense, on the other hand, more than doubled to P2.3 billion from P1 billion last year. This caused its net interest income to fall by by 3% to P4.69 billion to translate to a net interest margin of 6.4%.

On the funding side, total deposits grew 12% to P286.2 billion in the quarter. The bank’s low-cost deposits increased by 4% year-on-year to P143.1 billion from P137.4 billion.

Meanwhile, operating expenses excluding provisions for losses increased by 19% to P4 billion, mainly due to business taxes and other business related expenses. Provisions for losses went down by 22% to P872.6 million from the previous year.

EastWest Bank’s capital rose 10% to P43.9 billion, while total assets stood at P372.8 billion at end-March, growing by 18% from the same period last year.

The bank’s capital adequacy ratio stood at 12.6%, while its common equity Tier 1 ratio stood at 9.9%.

As of March 31, EastWest Bank has a total of 390 stores. Its total automated teller machine network is at 584. Meanwhile, the bank’s subsidiaries have a total of 76 stores.

“For the rest of 2019, East West expects market liquidity situation to improve and interest rates to go lower as the year progresses,” EastWest Bank said in its quarterly report. “This is expected to be felt in the second half of the year. In the first six months of the year, we expect continued challenges on net interest margins as deposit costs is expected to remain high while competition will exert pressure for loan yield adjustments to be subdued.”

EastWest Bank shares closed at P10.98 apiece on Wednesday, up by 0.73%. — RJNI

How does the Philippines compare in Artificial Intelligence (AI) adoption?

How does the Philippines compare in Artificial Intelligence (AI) adoption?

How PSEi member stocks performed — May 15, 2019

Here’s a quick glance at how PSEi stocks fared on Wednesday, May 15, 2019.

 

San Miguel wins fifth straight Philippine Cup title

By Michael Angelo S. Murillo
Senior Reporter

THE stranglehold of the San Miguel Beermen on the prestigious PBA Philippine Cup title continued as they won their fifth straight All-Filipino crown by outlasting the Magnolia Hotshots Pambansang Manok, 72-71, in their Game Seven decider on Wednesday at the Smart Araneta Coliseum.

Struggled in the early goings of the contest, the Beermen fought their way back in the second half, relying on their collective championship experience, to claim another Philippine Basketball Association All-Filipino title and their 26th PBA championship overall.

San Miguel opened the game with a 7-0 blast with June Mar Fajardo and Arwind Santos conspiring to give their team a boost.

After that, however, the Beermen would struggle and saw the Hotshots take advantage of it, racing to a 24-13 blast, led by Ian Sangalang, the rest of the opening quarter to go on top, 24-20.

In the second quarter, things turned for the worse for the Beermen as their offensive woes continued.

Managing to put just five points, San Miguel was buried deeper, 38-25, by the halftime break.

Mark Barroca got the Hotshots to a good start in the third period, firing five straight points to extend their lead to 17 points, 43-26.

But San Miguel would answer with seven straight points to narrow the gap, 43-33, with 8:15 to go in the frame.

The Beermen kept inching their way, coming to within six points, 49-43, with under three minutes to go.

Magnolia, however, found ways to keep San Miguel at bay on its way to a 58-50 lead heading into the final canto.

Down to the last 12 minutes, the Beermen came out charging to begin the fourth period.

Led by the veteran backcourt of Alex Cabagnot and Chris Ross, they overhauled Magnolia’s lead, 62-61, in the first five minutes after a layup from Mr. Santos.

The two teams went back-and-forth after, exchanging big baskets after big baskets.

The score was at 69-68, and the Hotshots on top, at the 3:26 mark.

Magnolia continued to hold sway, 71-70, with two minutes left to play.

Mr. Cabagnot then gave the lead to the Beermen, 72-71, with 57 seconds left off a fadeaway jumper under duress.

The Hotshots tried to reclaim the upper hand after but the short stab at the basket by Mr. Sangalang failed to connect.

A scramble for the ball ensued after that led to an out-of-bounds play. After review, Magnolia got back ball possession with 37 ticks left.

Magnolia set up a play to score but was unsuccessful anew with Jio Jalalon’s jumper not finding the mark.

Mr. Fajardo got the offensive rebound and the Beermen sued for time with 18 seconds remaining.

Off an inbounds play, however, San Miguel lost the ball, sending the possession back to Magnolia with just a second shedding from the game clock.

The Hotshots called timeout to regroup and craft their play.

They went to Paul Lee for the go-ahead basket but the San Miguel defense was ready, forcing the Magnolia guard to drop off to Mr. Jalalon who missed his shot.

Mr. Fajardo collared the rebound after which he was fouled.

The San Miguel big man missed both his free throws, giving Magnolia a chance to tie or win the game.

Mr. Lee, however, was not able to get a clear path to heave a desperation shot as time expired, sending the Beermen and their supporters to celebration.

Mr. Cabagnot led San Miguel with 18 points with Mr. Fajardo finishing with 17 points and 31 rebounds. Mr. Santos also had 17 points.

For Magnolia, it was Mr. Sangalang who showed the way with 18 points with Mr. Lee and Rafi Reavis adding 11 points each.

“It was extremely difficult. We went back-and forth and Magnolia put up a tough fight. Our camaraderie did it for us. We won it collectively as a group. We are just thankful,” said Mr. Cabagnot, named player of the game.

The latest title is the ninth Philippine Cup title for the Beermen.

March OFW remittances rise 6.6% after end of Kuwait worker ban

REMITTANCES from overseas Filipino workers (OFWs) surged in March after a low base from a year earlier, when money sent home was dampened by the government-imposed ban on deployment to Kuwait.

On Wednesday, the Bangko Sentral ng Pilipinas (BSP) reported that cash remittances rose 6.6% to $2.5 billion in March.

The March increase topped the recent high of 3.9% in December.

According to BSP, much of the growth was from the United States, which accounted for two percentage points of the 6.6% rise, while remittances from Singapore and the UK accounted for 1.7 and 1.2 percentage points, respectively.

Banks accounted for $2.5 billion worth of cash remittances in March, up 6.6% year on year.

In the first quarter, remittances rose 4.2% year on year to $7.3 billion. The US accounted for 35.1% of the total. Rounding out the top sources were Saudi Arabia, Singapore, the United Arab Emirates, the UK, Japan, Canada, Qatar, Hong Kong and Kuwait.

These countries accounted for almost 78% of the total in the first three months, the BSP said.

Meanwhile, personal remittances rose 6.4% to $2.8 billion in March.

In the first quarter, personal remittances — a category that estimates the net earnings of all workers on contracts of less than one year and of all sea-based workers, as well as personal transfers by workers on longer contracts, migrants, and capital transfers from households overseas to their relatives in the Philippines — rose 3.7% year-on-year to $8.1 billion.

Michael L. Ricafort, an economist with the Rizal Commercial Banking Corp., (RCBC), said in a mobile message that OFW remittances started to recover after the Philippine government lifted its worker deployment ban to Kuwait. The ban was imposed amid allegations of mistreatment of domestic workers, highlighted by the discovery in 2018 of a worker who was killed, presumably by her employers, and found in a freezer.

“The faster growth in OFW remittances of 6.6% year on year in March 2019 may have to do with lower base/denominator effects a year ago,” Mr. Ricafort said, noting that remittance growth in the same month last year was minus 9.8%.

“OFW remittances started to pick up again after the brief deployment ban in Kuwait early last year. Seasonal increase in OFW remittances also happen in March to fund increased spending for graduation celebrations, preparations for Holy Week holiday-related spending and also for upcoming tuition payments,” Mr. Ricafort said.

Union Bank of the Philippines Chief Economist Ruben Carlo O. Asuncion, meanwhile, said that the sudden increase in March remittances is a “one-off” which may be due to the need for OFWs to fund tuition and vacations.

“It may be just a one-off event with the expectation that remittances are beginning to slow down,” Mr. Asuncion said.

Nicholas Antonio T. Mapa, ING Bank N.V. Manila’s senior economist, said in an e-mail to reporters: “Overseas Filipino remittances have chugged along at a slow and almost sure pace of 3%-4% despite volatile oil prices, Saudization and several civil wars and recessions. For the time being, the rapid pace of growth in imports given the nascent investment driven growth will outpace the slow and steady growth of remittances and BPOs (Business Process Outsourcing).”

Saudization is the policy adopted by Saudi Arabia to prioritize its own nationals for employment.

“In the long run, we can expect the slow and steady stream of Overseas Filipino remittances and BPO call center receipts to continue chugging along and eventually yield current account surpluses again, once the flash bang of an import binge peters out and this current investment cycle fades,” Mr. Mapa said. — Reicelene Joy N. Ignacio

DoE may limit power contracts to 70% of plant capacity

THE Department of Energy (DoE) is drafting rules that will cap the energy contracted by power plants to just 70% of their installed capacity, leaving a sufficient buffer for use as replacement power to replace the supply lost during unscheduled or unplanned facility outages.

“We have to encourage the plants to be well-maintained. And how do we do that? We’re looking at a 70% cap of their contracting with distribution utilities so that they can have more power available for replacement power, for power available for ancillary services and more power available in the spot market,” said Energy Undersecretary Felix William B. Fuentebella in a news conference on Wednesday to present energy stakeholders’ assessment of the power situation during the election period.

He said the cap would ease the usage of a plant akin to a vehicle at cruising instead of maximum speed. He said other jurisdictions have adopted a similar policy.

“Sobrang minamadali na (It’s being rushed). ASAP,” he said, when asked when the circular is expected to take effect.

He said in the next three months, the rules should have gone through a focus group discussion, the drafting of the circular, a public consultation, the incorporation of comments, and promulgation.

Mr. Fuentebella said the application of the circular is prospective, but contracts that are up for renewal will be covered. He could not immediately assess what percentage of capacity has been contracted by power generation plants.

“I would assume everyone is fully contracted,” said Raymond R. Roseus, Aboitiz Power Corp. vice-president for industry relations, when asked to comment on the DoE’s planned circular.

“Just like any draft, they come up with a program. They consult, it’s subjected to debate. I cannot comment yet because we haven’t fully seen the draft circular,” he said.

“We always try to look at everything first before we give our formal position.”

He said fully contracting power capacity remains the assumption when building power plants.

The DoE’s proposed circular comes at a time when the grid is expected to continue experiencing thinning power reserves as demand rises while power plants report unplanned outages.

“Projection-wise, [the situation will normalize in] September,” said Fidel L. Dagsaan, Jr., National Grid Corp. of the Philippines (NGCP) power network planning senior manager for system operations.

On Wednesday, grid operator NGCP placed the Luzon grid on yellow alert after the unplanned outage of Bacman Energy, Inc.’s unit 1 and GNPower Mariveles Coal Plant Ltd. Co’s unit 1, reducing available capacity by 60 megawatts (MW) and 316 MW respectively.

Seven other plants were de-rated or were not operating at full capacity. Most of them are hydroelectric power facilities. In all, the de-rating cut available capacity by 842 MW more.

The yellow alert notice, which was expected at 1-5 p.m. and again at 6-7 p.m., was issued as total available capacity was placed at 11,749 MW while peak demand was at 11,024 MW.

Normal operations require a regulating reserve equivalent to 4% of peak demand or 441 MW, plus dispatchable and contingency reserves at 647 MW each, which is equivalent to the capacity of the Sual power plant’s two units in Pangasinan.

Yesterday’s available capacity left a net operating margin of just 264 MW when the reserves were factored in.

Mr. Dagsaan said the Luzon grid is expected to experience next week its peak demand, which was previously projected at 11,403 MW. That number may not be breached, he said. He placed available capacity next week at 12,171 MW. So far this year, demand in the main island peaked at 11,074 MW, which was hit on May 2.

During yesterday’s press conference, the energy stakeholders described the power situation during the election season to be generally “uneventful.” — Victor V. Saulon

Crunch time for gov’t spending as DBM pressed to issue budget circular

THE Department of Budget and Management (DBM) needs to issue a circular for the next budget in order immediately to get the ball rolling on government programs that were stalled by the delays in Congress passing the 2019 budget, the Department of Finance (DoF) said Wednesday.

“There is an urgent need for the Department of Budget and Management (DBM) to issue the Budget Circular for the (2020) General Appropriations Act (GAA) promptly in order to continue infrastructure projects that have been delayed due to the budget deadlock in Congress,” the DoF said in a statement.

The budget circular calls on government agencies to submit their proposed spending plans for consolidation into the budget bill,

The DoF noted that the government underspent by P69.5 billion in the first quarter due to the delay in the passage of the 2019 GAA, which economic managers blamed for the growth slowdown to 5.6% during the period.

The DoF said that expenditure declined by 0.8% in the first quarter after growing 25.4% a year earlier.

As a result of the lost spending, the budget deficit as a share of gross domestic product (GDP) fell to 2.1% from 3.9% a year earlier.

Asked when the budget circular can be issued, DBM Assistant Secretary Rolando U. Toledo said in a mobile message, “We are targeting to issue within the week and hopefully, we can issue if not today, tomorrow.”

Before the end of first quarter, Finance Secretary Carlos G. Dominguez III said that even with the signing of the P3.66-trillion budget, it is impossible for the government to achieve its 6%-7% GDP growth target due to the election ban on government projects, with the upcoming rainy season also posing delays for construction.

The budget, which was proposed to spend P3.757 trillion, was cut down to P3.66 trillion after President Rodrigo R. Duterte vetoed a P95.3 billion worth of allocations mainly for the Department of Public Works and Highways (DPWH).

The DBM, however, said that the veto will not affect the government’s flagship projects.

“Preliminary analysis of the impact of the direct veto suggests that the effect can be minimal since the vetoed items pertain to local infrastructure projects after the bicameral approval of the FY 2019 General Appropriations Bills and do not affect the national government’s flagship infrastructure projects,” DBM said in its outlook statement.

“While in general, it could still result in lower disbursements, the reduction may partly be offset by payables from prior years’ infrastructure projects, changes in the appropriations of non-DPWH projects and potential payables from continuing appropriations and unobligated allotments due to the extension of the validity of the 2018 appropriations for MOOEs (Maintenance and Other Operating Expenses) and CO (Capital Outlats),” DBM added. — Reicelene Joy N. Ignacio

Report on ‘onerous’ gov’t contracts due this month

THE Department of Justice (DoJ) is set to submit to President Rodrigo R. Duterte its initial report on the review of government contracts with firms and other countries, including the water concession agreements and the foreign loan contracts with China, within this month, Justice Secretary Menardo I. Guevarra said on Wednesday.

Mr. Guevarra also said it is “near impossible” to review all the contracts as instructed by the President last month.

In a phone message to BusinessWorld on Wednesday, Mr. Guevarra said an initial report on the review of government contracts is expected “within the month.”

Asked if there is a timeline for the DoJ team formed to review the contracts, he said: “Yes, but only for some major projects. It is near impossible to review all government contracts. The report will be submitted directly to the President.”

Among those contracts, he also said, are the “water concession agreements and the foreign loan contracts with China.”

In a statement on April 2, Mr. Guevarra said the priority contracts for review include “concession agreements on public utilities and foreign loan contracts.”

“The target provisions are those perceived to be onerous, one-sided, disadvantageous to the government, and/or contrary to public order or public policy,” he explained. “As these are contracts, the first course of action should be to jointly review and renegotiate; if this is unsuccessful, legal action for rescission may be resorted to.”

At the April 1 Cabinet Meeting, the President instructed agencies, including the DoJ and the Office of the Solicitor General, to review all contracts entered into and remove “onerous provisions that might be detrimental to the lives of the Filipinos.”

“Even if it is executed, if it’s in violation of the Constitution, you can rescind and strike it down. We’ll ask the court to rescind it,” the President’s spokesman Salvador S. Panelo said in a briefing on April 2.

“The President is warning all and sundry that for as long as he is the President he will not allow anything that will go against the interest of the Filipino people. He will use the Constitution, all the powers given him to protect the Filipino people and to serve them faithfully,” he added.

“We’ll have to examine every provision in the contract. Anything against public policy or against the law, against the Constitution, we have to strike down… It would be a continuing investigation of contracts,” Mr. Panelo said further. — Arjay L. Balinbin

Are you letting your data govern you?

In the past months, I’ve had discussions with banks, business groups, and regulators about how data has become one of the most precious assets of an organization. Most, if not all of us, share the same perspective that data is indeed a key enabler of organizational growth. However, maximizing the value of data continues to be a big challenge.

My varied professional roles have allowed me to manage, process, analyze and transform both financial and non-financial data — delivering reports to internal and external stakeholders. From my experience and recent conversations, I came across two key misconceptions regarding data.

MORE DATA, MORE INSIGHTS
In today’s fast-paced environment, key business decision-makers need quick and comprehensive insights to remain relevant in the markets where they operate. Regulators likewise require more perspectives in crafting policies and guidelines to make the financial markets more resilient.

As the need for information-driven insights intensifies, users and decision-makers only become aware of the data gaps as they perform their analysis. To augment this, organizations tend to collect even more data to hopefully address the gaps and enrich the analysis. Additional manual processes are carried out to bridge these requirements and still provide the reports and analysis to the stakeholders. However, additional processes and data collected put pressure on the timeliness of the results.

DATA GOVERNS YOU
Some analysts are lucky enough to be given a few weeks to process and interpret data, but most are not. This is driven by the principle of timeliness — the value of insights from the data declines over time. As such, analysts need to be agile enough to be able to provide quick results albeit without compromising completeness and accuracy. Tools and techniques for data analytics need to enable this balance of attributes.

Based on my experience, the activity and results of data analytics are often interesting. The variety and depth of insights that can be obtained are quite limitless as well. To get the appropriate insight often requires a well-trained eye or a closer look to understand the data better. However, as the need for timeliness kicks in, most analysts (as they perform business-as-usual activities) are forced to rely on readily-available data. They analyze through existing tools and models to be able to address the information needs on time. With this intense time pressure, more often than not, preparers can only respond with “that’s what the data tells us” when asked to explain their outputs. This being the case, it is quite difficult to conclude that the results of the analyses are complete and accurate — since that’s “the data.”

This is a common experience for report preparers and users alike. From this scenario alone, we realize that data, managed correctly or not, has a great impact on the quality of the analysis, decisions, and reasoning of stakeholders.

To address these misconceptions, organizations can start by revisiting and changing their mindset. Let’s take a step back and ask ourselves, “Am I letting my data govern me?” One telltale sign is when we only look at them at the middle or end of the process (i.e. when we look deeper during our analytics when everything has been collected) and worse, get stuck with “the data” we have.

As we try to answer the question, let’s consider these actions to handle data more effectively and realize its benefits:

1. Look at data from start to end, and top to bottom. We need to look at data from a holistic perspective, i.e. from collection to use, per producer and consumer. When doing so, organizations must realize that proper collection, handling and analysis of data are critical to maximizing its benefits.

Looking at data from start to end and top to bottom allows organizations to identify critical data elements, their primary data sources, and the ultimate data consumers. Once identified, organizations can have a stronger grasp of what impacts them, as well as how these data will influence their decisions and strategic actions. More importantly, the “meaning” of data should be defined to agree on a common understanding of what each data element intends to describe.

2. Invest time to manage it. Most organizations are becoming increasingly technology-led and data-driven due to the fast-paced and dynamic environment we are in. This requires agility, but being agile does not mean that we do things quickly without a care. While we want data to be available at the earliest possible time, quality remains an important consideration. After all, data analysis can only be valuable when based on quality data.

Organizations should invest time and resources managing the data. This starts with defining the data governance and management strategy, the key stakeholders (producers and consumers) and their responsibilities and the standards that the organization need to adhere to. Control points and compliance need to be established to provide checkpoints across the data life cycle. Data quality should be a business goal considering its various elements — accuracy, completeness, consistency, timeliness and coverage, to name a few. Organizations need to know what data they hold and where they are, and be able to describe and categorize these data to drive proper use and management.

With all the changes happening across different industries and territories, we are usually confronted with more increasing quantities of data and more complex tools in data analytics. However, the resulting analysis from them can only be valuable when founded on good quality data — a scarce resource among organizations. Insights from good-quality data can have a significant impact on an organization’s ability to make good decisions and to sustain overall growth.

Reflecting more deeply on data management made me realize that existing technology, data analytics, tools, and models will only result in valuable insights and better management decisions when anchored on good-quality data arising from good data governance and management. Are you governing your data or do you let it govern you?

The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of PricewaterhouseCoopers Consulting Services Philippines Co. Ltd. The content is for general information purposes only, and should not be used as a substitute for specific advice.

 

Jamil Saripada is a manager with the Risk Consulting practice of PricewaterhouseCoopers Consulting Services Philippines Co. Ltd., a Philippine member firm of the PwC network.

+63 (2) 845-2728

jamil.saripada@pwc.com

SC ruling portends lower power rates for ratepayers

By Viking Logarta

THE cloud of uncertainty that hovered over stakeholders in the power sector was lifted by the Supreme Court (SC) decision on May 3 on the competitive procurement of power supply by distribution utilities, mainly for residential ratepayers. The aims and expected results of that decision are to be lauded. If the Department of Energy (DoE) and the Energy Regulatory Commission (ERC) hew to the spirit of the court’s decision well, ratepayers can expect lower rates than will otherwise be, and would have been, the case. But there are implementation challenges that have to be addressed.

Prior to the regulations enacted by the DoE and supposed to have taken effect in June 2015, the distribution utilities (DUs) could procure power supply for ratepayers even from affiliated entities, as long as the power supply agreement (PSA) passed muster before the ERC. The DoE regulations tried to make the process more competitive, but only in a limited way. That’s because the subsequent ERC process would still have guaranteed independent power producers (IPPs) returns on their capital.

The SC decision castigated the abuse of power by the ERC in extending the deadline for negotiated PSAs between the DUs and IPPs by 10 months. In effect, the SC ruled, the Commission effectively postponed more stringent competition by as much as 20 years, the effective period of most contracts. Simply unacceptable, the court said.

As the case was pending in the SC, the DoE and ERC tried to fine-tune the competitive process further. Noteworthy is the fact that the current ERC has proposed, in its current draft rules, abolishing automatic fuel-cost adjustments and thereby guaranteed returns to independent power producers (IPPs), as well as limiting contract terms to 10 years. The two provisions, taken separately and together, pose theoretical and practical challenges.

Effective competition requires that IPPs compete not just on managerial, technical, and operational efficiency, but more importantly, on their desired returns to capital, given the attendant risks. In the past regulatory process, the utilities would embark on a pro forma competitive process, with the ERC still regulating, and thus guaranteeing, a rate of return. That guarantee, in turn, has been enforced by the so-called automatic fuel-cost adjustment, a mechanism that passes on the risks of fuel price volatility onto captive ratepayers.

Captive ratepayers are those who have no choice but to pay for whatever electricity generation supply is procured by the distribution utility, regardless of whether that supply was the best deal to be had from the market. The responsibility for ensuring that captive ratepayers get the best deal falls squarely on the shoulders of the DoE and the ERC. The procedure for liberation from captivity was spelled out in the electric power reforms act by way of declining thresholds of average annual peak demand of ratepayers, and many industrial and commercial customers have qualified to be “contestable” under the first threshold of one (1) megawatt set by the ERC.

However, the process of reducing the threshold, and thus expanding the contestable market, has been suspended because of a case lodged by certain interests. That case is still pending before the Supreme Court. The DoE has reduced the threshold to 500 kilowatts, on a voluntary basis, but there is as yet no showing how effective this has been.

What the Department of Energy and ERC will do in the coming days will be crucial if the spirit of the court decision is to be upheld. The implementation guidelines will have to ensure supply adequacy by minimizing any delays in the “revised” procurement process, and assure investors a stable environment from where they can get a fair or reasonable return. Otherwise, reforms will be blamed for any shortage that ensues, as the case of the current water crisis highlights.

One way of expediting the revised process is to resort to the Swiss challenge methodology with all its imperfections. This means subjecting the original proposal with its associated technical parameters to a price challenge by other potential suppliers. This procedure gives original proponents a fair result, given the new rules, and newcomers, sufficient time to challenge the incumbents.

We realize that the rapidly changing costs in the power sector, especially of variable and firm renewable energy technologies, pose a challenge to policy makers and regulators in coming out with stable rules. Our institute is committed to participate in this process. But we urge the regulators to be more transparent, especially with respect to making information available to all stakeholders.

 

Viking Logarta is Energy Policy Advisor of the Institute for Climate and Sustainable Cities.

Meniong

Herminio “Meniong” Guivelondo Teves, born April 25, 1920, former governor and former congressman of his beloved Negros Oriental, passed away yesterday at the age of 99. If he had his way, I am sure he would have preferred to make it an even 100. However, fate chose to intervene. It robbed him of a year. But what is a year compared to a long and fruitful life.

Meniong first served at the House of Representatives in 1969, but his term was cut short by the declaration of Martial Law in 1972. He was OIC Governor of Negros Oriental in 1986-1988. I first met Meniong during his second stint in Congress, which was in 1998-2007. I was still an editor for this newspaper then, and Meniong was my source on goings-on at the House.

Meniong was among the few standouts in my 26 years as a journalist. He was a “character,” to say the least. Sometime back he had asked me to edit his book on crafting and legislating tax laws. And it was while going over his book that I truly appreciated his common sense and practical approach to issues and other things.

It was my honor and privilege to have known him, to have had him as a news subject as well as a news source, and to have been his friend. I last saw Meniong during his 97th birthday celebration at the Alabang Country Club. I can still recall how his eyes lit and how he smiled as he shook hands with guests and shared a few words with friends at the party.

In Meniong’s memory, please allow me to share with you an updated version of my column published in April 2018, on the occasion of his 98th birthday:

I referred to him then as “Old-Timer.” It was the way he did things, the way he went about them, that I admired the most about him. He was high society but he was never snooty nor snobbish. He was always very down-to-earth, very folksy, and quick to offer a smile and a very firm handshake. And then there was his common sense way of dealing with things.

He was a veteran of life – he was around a long time, had experienced a lot, and had plenty to share with those younger than him. At 91, he could still play nine holes of golf. In fact, at 91, I still had the pleasure of his company in attending a Healthcare and Retirement conference in Makati City. At the time, he was still on the lookout for new business opportunities.

Meniong was always an entrepreneur. While his older brother Lorenzo, born in 1918, was busy with politics, he was busy with running businesses. To name a few: Unitrade Inc of Dumaguete City; Tolong Sugar Milling Co. Inc. in Sta. Catalina, Negros Oriental; Tayasan Agricultural Farm in Tayasan, Negros Oriental; and San Antonio Cattle in San Antonio, Sibula, Negros Oriental.

Meniong was always a busy body, even in his late years. He was already 78 when he started his second stint in Congress, but he still managed to work for three terms. His inability to keep still I blame on his sea legs. He went to the Philippine Nautical School and graduated at the top of his class in 1941 with a degree in maritime transportation.

He was deck officer on an inter-island ship when the war came to Philippine shores in December 1941. During the war, given his maritime training, he helped out on a number of US vessels. He helped ferry military equipment and soldiers all around until a Japanese bomber sunk their ship. After the war, he was head instructor at Cebu Nautical School. He later joined Iloilo Negros Shipping Company’s Cebu City operations, and was its manager in 1947-1951.

Three years later, his older brother Lorenzo was elected representative of the 1st District of Negros Oriental. Lorenzo was congressman in 1954-1965, and was senator in the 6th Congress and 7th Congress, from 1967 until the declaration of Martial Law in 1972. Lorenzo was also governor of Negros Oriental in 1978-1987.

Meniong’s first foray into politics was in 1969, at the age of 49. With Lorenzo at the Senate, Meniong was elected in his stead to represent their congressional district and was serving at the House until Martial Law shut down Congress. In 1986-1988, Cory Aquino made Meniong OIC governor of Negros Oriental. And then in 1998-2007, he was back in Congress for nine years.

If I recall correctly, in his last term in Congress (2004-2007), Meniong was the most senior member (in age) of the House of Representatives, and yet he still managed perfect attendance. He was also always on time for plenary sessions. That was just the kind of person Meniong was. He took his responsibilities seriously, and old age was never an excuse to take things easy.

But more than his punctuality and his industry, and his capacity for work even in his late years, I admired Meniong the most for his wisdom. Wisdom, of course, is not something that comes naturally to all who age. Meniong’s resulted from his broad experience, and his unquenchable thirst for knowledge. He lived long enough to see and experience many things, and to learn from them. This, I believe, was Meniong’s greatest gift. If only we can all be like him in this regard.

 

Marvin Tort is a former managing editor of BusinessWorld, and a former chairman of the Philippines Press Council

matort@yahoo.com

Change for the better

How do you react to changes in life, may it be a career change or change in the organization? Do you accept it wholeheartedly? Or do you shy away from change to stay in your comfort zone? I am a person who always seeks opportunities, looks for change and sees the bigger picture life has to offer.

However, I won’t deny that I am afraid to face new challenges, changes and opportunities. There were times I doubted myself, asking if I was good enough. Can I really do this? If I were not good enough, what will happen to me? But, while reading the book Who Moved My Cheese? by Spencer Johnson, I realized that “Change is the only thing that is certain.” No matter what happens in life, change is inevitable. And all we have to do is learn how to manage and adapt positively with change.

Personally, I always feel safe when I am in my comfort zone. There are times, when faced with an opportunity, that I turned it down. I prefer to stay where I will be comfortable. But, eventually I have realized that these changes and challenges will help me to achieve my goals. In an organization, we may encounter changes as our firm undergoes acquisitions, mergers, a management change, or simply adopts a new policy or hires a new supervisor. Often, we are not ready for these changes and sometimes, we choose to resist the change that the organization is trying to offer us. But understanding those changes has made me realize that it will be easier to handle if we positively accept it.

ENGAGE WITH YOUR CO-WORKER
One of the reasons employees stay is because workmates turned into family. For me, teamwork is important and I appreciate being with my team because we support each other in terms of doing our job responsibilities. I realized that whenever we face new changes in the organization, we should not be afraid to accept these new challenges as there are people along in our journey who believe we can make it. In my case, I was given an opportunity to apply for a higher position. At first I was hesitant to accept the new role and questioned myself if I was really qualified enough. But I am so grateful that my support system in the organization encouraged and believed in me. Because of their encouragement, I have gained confidence and was able to step up to a bigger role.

BE OPTIMISTIC
As I’ve said, sometimes I doubted myself, but realized that it is better to accept positively the change in our workplace. Accepting new job responsibilities is not as bad as we think; rather it may surprise us with new opportunities and success. So, if we ever felt impatient or irritated with our boss because of the voluminous work or new projects he just gave us, let go of your bad feelings. Be optimistic. Challenges are often not as hard as we think. Remember, success isn’t rewarding if it’s easy.

ADAPT AND ACCEPT
Change happens, so instead of resistance, why not accept and find the benefit of it? Say for example, in our company, a merger has happened and there are changes in top management as a new president is appointed. At first it was difficult for us, but looking at the positive side, the merger made the company sustainable on the triple bottom line: people, profit, and planet.

KEEP MOVING
There are always tough times. All I can is just keep on moving and never give up. It takes time to grow in the organization, but as Jack Ma, the founder of Alibaba Group, once said, “Never give up. Today is hard, tomorrow will be worse, but the day after tomorrow will be sunshine.” We will never reach our destination if we give up. What’s important is we keep on doing what we do and know best, and success will come naturally. Life brings unexpected surprises, just keep pushing through the finish line.

As we continue our journey through life and career in the organization, we learn that change is inevitable. We should never be afraid, but rather enjoy the ride, assess these changes and weigh their pros and cons. Who knows, maybe it’s all for the best. So, grab new opportunities and savor the experience throughout our journey. It prepares us to reach our goal. For all we know, these changes are “blessings in disguise.” So, instead of being reactive and resistance to changes, pause, be proactive, then embrace the change.

 

Crystal Justine Tan is an MBA student of the De La Salle University Ramon V. del Rosario College of Business. This article was part of the requirements of the course, Strategic Human Resource Management.

crystal_tan@dlsu.edu.ph

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