National Government fiscal performance
THE NATIONAL Government’s (NG) budget deficit sharply shrank in July as revenues posted double-digit growth, the Bureau of the Treasury (BTr) said. Read the full story.
EastWest Bank plans bond issue
EAST WEST Banking Corp. (EastWest Bank) is looking to raise up to P10 billion from bond issuances, although the timing will depend on market conditions, its top official said on Wednesday.
“We’re looking at a bond issue. We’re preparing at the moment for a bond issue, but we will not hit it until the price is right,” EastWest Bank Chief Executive Officer Jerry G. Ngo said on the sidelines of the launch of the lender’s new digital banking app.
He added that the bank has already tapped an advisor for the issue.
EastWest Bank could issue bonds worth up to P10 billion in tiers and in varying tenors, he added.
Mr. Ngo said he expects the Bangko Sentral ng Pilipinas (BSP) to cut rates by another 25 basis points (bps) before the end of the year as the US Federal Reserve is also expected to start its own easing cycle by next month.
The BSP’s policy-setting Monetary Board on Aug. 15 slashed its policy rate by 25 bps to 6.25%, marking its first easing move in nearly four years.
“I think the expectation (for the Fed) now is… one cut in September, and I think there’s another one coming up in November. So, I think the BSP will be very hard-pressed not to follow suit,” Mr. Ngo said.
EastWest Bank’s margins are expected to improve as benchmark interest rates go down, he added.
“We’re a consumer-focused bank. So, what happens is we’re a negatively gapped balance sheet. What that actually means is that we have long-term assets that are priced on a fixed basis, so as funding costs come down, the margins will be higher,” he said.
For every 25-bp rate cut by the BSP, Mr. Ngo said he expects a 5- to 10-bp expansion in their net interest margin.
Loan pricing will also improve as new bookings will be based on the lower benchmark rates, he added.
NEW DIGITAL BANKING APP
Meanwhile, EastWest Bank on Wednesday launched a new digital banking app as it looks to streamline its online services.
“We’re making a beginning of a new digital banking era for EastWest Bank. The launch of EastWest EasyWay represents our vision for the future of banking: one that is intuitive, seamless, and more importantly, customer-centric,” Mr. Ngo said in a speech during the app’s launch on Wednesday.
EasyWay is available on the App Store and Google Play Store.
The bank aims to onboard 40% of its total clientele of 2.6 million to the app, he said.
EasyWay currently has 500,000 users, he added, with 170,000 users still needing to be migrated to the new app as EastWest Bank is targeting to phase out its old app by November.
The new app will be part of the lender’s range of digital services that include EasyBiz, Komo, ESTA, and EWPay.
It allows users to pay bills, manage accounts, loans, and credit cards, as well as transact. It also features 24/7 customer support.
Mr. Ngo said they will roll out more features in the coming months, such as wealth management and accounts, mobile check deposit, credit card and loan application, and quick-response or QR fund transfers and payments.
The lender is also planning to introduce a business-focused app in the coming months as part of a pipeline of digital innovations, he added.
EastWest Bank saw its net income rise by 3.69% year on year to P1.79 billion in the second quarter as its retail loans continued to grow.
Its share price went down by four centavos or 0.44% to end at P9.01 apiece on Wednesday. — A.M.C. Sy
Xiaomi launches new smart TVs in the Philippines
TECHNOLOGY brand Xiaomi has launched its Xiaomi Smart TV 2025 models in the Philippines, it said on Wednesday.
The company’s new smart television models are available as a Shopee exclusive from Aug. 25 to Sept. 5 at promo prices, it said in a statement. Meanwhile, regular prices start at P7,695 for Xiaomi TV A 2025 series models, while the Xiaomi TV A Pro 2025 TVs are priced at P16,195 and up, depending on screen size.
The new smart TV models have a built-in Google TV operating system with Google Assistant. Chromecast and Miracast are also supported, and Netflix, Amazon Prime Video, and YouTube are preinstalled.
The entry-level Xiaomi TV A 2025 models come in 32-inch and 55-inch variants with a 4K HDR display and motion smoothing technology, as well as Dolby Audio, DTS:X, and DTS Virtual:X for surround sound.
Both feature a metal finish with an ultra-slim bezel design and a 60Hz refresh rate. The 32-inch model has a quad-core A55 CPU with 1.5GB RAM and 8GB ROM, while the 55-inch variant has a quad-core A55 CPU and Mali-G52 GPU with 2GB RAM and 8GB ROM.
Meanwhile, the Xiaomi TV A Pro 2025 series is available in bigger 43-inch, 55-inch, 65-inch, and 75-inch variants.
“The Xiaomi TV A Pro 2025 Series leads the way in home entertainment innovation. It’s got the biggest screen in the line with a 75” model, fully equipped with a bright and stunning 4K QLED display with a 60Hz refresh rate that shows dazzling visuals in smooth and seamless 4K HDR,” the brand said.
“Enjoy total immersion in anything you’re watching — stream all your favorites on the internet without interruptions through its 5GHz-capable built-in Wi-Fi adapter, all presented in top-notch visuals and vibrant sound from Dolby Audio, DTS:X, and DTS Virtual: X1. It sits beautifully in the center of your home entertainment setup with a premium metal finish and an ultra-slim bezel design,” it added.
The new Xiaomi TV A Pro models come in a premium bezel-less design, with a unibody metal frame. All variants come with a quad-core A55 CPU and Mali-G52 GPU with 2GB RAM and 8GB ROM. — BVR
SEC revokes corporate registration of Lucky South 99
THE SECURITIES and Exchange Commission (SEC) has revoked the corporate registration of Lucky South 99 Corp., formerly known as Lucky South 99 Outsourcing, Inc., for violating corporate laws.
The SEC’s order, dated July 30, cited violations of Section 44 of Republic Act No. 11232, also known as the Revised Corporation Code of the Philippines (RCC), in conjunction with Section 179(j) of the RCC.
According to the SEC, Lucky South 99 Corp. was found to be engaged in activities beyond those permitted for a business process outsourcing company, as specified in the entity’s articles of incorporation (AoI).
“Considering that nowhere is it stated in its primary purpose that Lucky South 99 is authorized to engage and/or act as a Philippine Offshore Gaming Operator (POGO) in the Philippines, the activity of Lucky South 99 Corp. that intends to mislead or deceive the public into believing that it was authorized to conduct the aforesaid activities is considered an ultra vires act and therefore constitute serious misrepresentation,” the SEC said.
“It is important to emphasize that Lucky South 99 Corp. as a juridical person, is only allowed to exercise powers inherent to its corporate existence as provided in the RCC and those conferred in its AoI,” it added.
The state has linked Lucky South 99, a POGO based in Porac, Pampanga to human trafficking activities. — Revin Mikhael D. Ochave
Chinese embrace icy DIY drinks as competition with cafes heats up
BEIJING — Pre-packaged cups of ice have been flying off the shelves of Chinese convenience stores this summer as consumers experiment with tea, coffee, and juice combos to make affordable cold drinks that don’t involve a trip to a coffee shop.
China has seen a record breaking heat wave scorch provinces along its eastern seaboard this month.
The weather, along with the social media cred garnered from posting these creations, has helped to propel the popularity of ice cups and other pre-packaged drinks as consumers, worried about job security and the slowing economy, become more cost-conscious and eschew the likes of Starbucks and Luckin Coffee cafes, bubble tea chains, and juice bars for their own kitchens.
“The popularity of ice cups is in line with the characteristics of the young generation who likes trying new things,” said independent food and beverage analyst Zhu Danpeng. “People can post their ‘achievement’ online to share with friends.”
A search for ‘ice cups’ on lifestyle-focused social media platform Xiaohongshu returns more than 13,000 recent posts, many of them videos of people in their 20s and 30s showing off their convenience store creations.
One post shows an ice-cup three-quarters full of jasmine tea then being topped off with lychee juice. In another, a young woman pours pre-packaged black coffee over orange juice, making a dupe of the orange-flavored coffees popular in Chinese cafes.
This Do-It-Yourself (DIY) trend adds convenience stores to the list of factors putting competitive pressure on coffee shops in China, where the drinks market is already fragmented and highly competitive. Some coffee and bubble tea chains have opened more than 10,000 stores across the country and offer competitive coupons and discounts in an effort to attract consumers.
In addition to getting a cold drink, DIY ice cups give young consumers a showcase for their creativity.
Buying the ingredients to make an ice cup filled with pre-packaged Starbucks coffee and orange juice costs around 24.5 yuan, fractionally less than a 27 yuan Starbucks but with much bigger bragging rights.
Starbucks did not comment about the rising competition from convenience store drinks, but said in response to Reuters: “Starbucks has full ready-to-drink (RTD) coffee portfolios to meet diversified needs of Chinese consumers… According to Euromonitor, Starbucks now ranks No.2 in overall RTD coffee market.”
‘SENSATIONAL SUCCESS’
Though ice cups have long been popular in South Korea and Japan, they’ve never hit it big in China until this year, according to Jason Yu, greater China managing director of market research firm Kantar Worldpanel.
“Ice cups have been a sensational success this summer… I think it provides a good value for money option for young consumers to do their own DIY drink,” Mr. Yu said.
Using branded juices, pre-packaged coffees and milk drinks provides consumers with the sense that they are getting a good deal, while still enjoying a high-quality product, he said.
In convenience stores, it usually costs between 3 yuan ($0.4) for cups filled with ice cubes and 9 yuan for cups with spheres of ice.
Some beverage firms have paid heed to the trend, launching branded ice cups.
Mixue Bingcheng, a popular bubble tea franchise, began selling ice cups at just 1 yuan per cup last month. Nongfu Springs, China’s largest bottled water supplier, also offers 160 gm ice cups at 3.5 yuan in convenience stores.
But even as more young people embrace the DIY culture amid a trend towards thriftiness in China, some drinks enthusiasts say they will not replace convenience store ice cups with their own cups filled with homemade ice.
“The ice cups are not normal ice, you can’t make it at home,” one ice cup consumer said in a post on social media platform Xiaohongshu.
“Ice cubes in ice cups are made in a different way.” — Reuters
How PSEi member stocks performed — August 28, 2024
Here’s a quick glance at how PSEi stocks fared on Wednesday, August 28, 2024.
Stocks inch lower on last-minute profit taking
PHILIPPINE STOCKS slipped on Wednesday due to last-minute profit taking after the main index breached the 7,000 level intraday and following two consecutive days of gains.
The bellwether Philippine Stock Exchange index (PSEi) dropped by 0.22% or 15.40 points to end at 6,958.01 on Wednesday, while the broader all shares index fell by 0.04% or 1.73 points to close at 3,759.55.
The PSEi opened the session at 6,985.56, higher than Tuesday’s close of 6,973.41. It climbed to an intraday high of 7,016.04 but was unable to hold on to its gains, closing at its lowest level for the day.
“Late-day profit taking brought the local market down. Investors booked gains after the market climbed for two straight days. Chart-wise, the market retested but still failed to take its 7,000 resistance level,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.
Trading was “lethargic,” he added.
Value turnover declined to P5.34 billion on Wednesday with 1.27 billion shares changing hands from the P6.8 billion with 831.25 million issues traded on Tuesday.
“Investors are watching out for more economic data that will reinforce a potential rate cut in September. The prospect of easing monetary policy has many investors taking positions, reflecting broader market cautious optimism both locally and globally,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
Investors are unanimous in bets that the US Federal Reserve will begin cutting interest rates next month following Fed Chair Jerome H. Powell’s dovish tilt last week, with the debate now centered on whether or not it will be a super-sized 50-basis-point (bp) cut, Reuters reported.
The current pricing sits at a 36% chance for the larger cut, up from 29% a week ago, according to the CME Group’s FedWatch Tool. Markets, which are fully priced for a 25-bp cut next month, see just over 100 bps worth of easing by the end of the year.
A preliminary estimate for US gross domestic product in the second quarter is due later this week, along with the core personal consumption expenditures index, the Fed’s preferred inflation measure.
Sectoral indices were mixed on Wednesday. Services went down by 0.73% or 16.29 points to 2,212.82; holding firms dropped by 0.53% or 31.36 points to 5,833.03; and property declined by 0.42% or 11.87 points to 2,766.26.
On the other hand, mining and oil rose by 0.85% or 69.48 points to 8,235.68; industrials went up by 0.69% or 63.73 points to 9,301.35; and financials climbed by 0.57% or 12.29 points to 2,133.71.
“Nickel Asia Corp. was the top index gainer, jumping 4.92% to P3.41. PLDT Inc. was the main index laggard, falling 3.14% to P1,511,” Mr. Tantiangco said.
Advancers outnumbered decliners, 99 versus 90, while 54 names were unchanged.
Net foreign buying declined to P687.06 million on Wednesday from P897.83 million on Tuesday. — R.M.D. Ochave with Reuters
MRT-3 fare collections to miss projections
THE Department of Transportation (DoTr) expects fares generated by Metro Rail Transit Line 3 (MRT-3) to be weaker than expected, leading to a possible failure to meet its financial obligations to the commuter line’s operator under the terms of the build-lease-transfer (BLT) concession deal.
“With regards the BLT agreement, the government will pay a combined of P3.4 billion,” Transportation Assistant Secretary for railways Jorjette B. Aquino told the House appropriations committee on Wednesday.
She said however that farebox revenue in the eight months to August totaled P1.6 billion, while its projected non-rail revenue was P36 million for the remainder of 2024.
Proceeds generated from MRT-3 fares and non-rail income pay for the government’s equity rental and other obligations to the operator, Metro Rail Transit Corp. (MRTC).
Ms. Aquino said the P3.4 billion financial obligation to MRTC include P2.75 billion for equity rental, staffing, and administrative costs; as well as a further P690 million due by January.
Projected fare revenue for the four months to December is only around P800 million, which would leave the government about P960 million short of its obligations, she said.
The MRTC is set to turn over the MRT-3 to the government by July 2025 once its BTL agreement lapses. The government hopes to privatize MRT-3 before the contract expires next year.
“We need to know if the fare collection is enough to cover the government’s financial obligations and if not then we will look into how we can fill in these balances,” Assistant Minority Leader and Party-list Rep. Marissa P. Magsino said.
Ms. Aquino said the DoTr initially requested a budget of P3.1 billion for MRT-3 but the National Expenditure Program only approved P1.07 billion.
“If that is the case then the budget approved is not enough. We will look into that,” Ms. Magsino said.
Under the BLT agreement, the DoTR holds the franchise and also handles the operations and fare collection. The MRTC built and maintains the system in exchange for a payment from DoTr. — Ashley Erika O. Jose
Agriculture, Education secretaries appointed NEDA Board members
THE secretaries of Agriculture and Education have been made members of the National Economic and Development Authority (NEDA) Board, NEDA Secretary Arsenio M. Balisacan said.
Their membership ensures that the administration’s priorities “with respect to agriculture and food security, as well as education and the development of skills for a competitive economy, are properly attended to,” Mr. Balisacan told reporters at the Palace on Wednesday.
He said the proposed Philippine Civil Service Modernization Project — an “important project for the development of human resource management processes in the public sector” — was also discussed during Wednesday’s NEDA Board meeting.
The Board also approved a request to increase the project cost of the Metro Manila Priority Bridges Seismic Improvement Project and also extend the corresponding implementation period and loan validity of the project.
It seeks to “strengthen the resilience of the transport network in Metro Manila by replacing two major bridges, Lambingan Bridge and Guadalupe Bridge, on the arterial roadways with the improved seismic bridge design specifications,” according to a website post by the Japan International Cooperation Agency, which funds the project.
The Department of Public Works and Highways in April said the seismic improvement project will ultimately help decongest Metro Manila roads.
The Board also tackled the proposed upgrade and expansion of both the Bohol International Airport and Northern Mindanao’s Laguindingan International Airport, Mr. Balisacan said.
“We also reported on the progress in the implementation of the 186 infrastructure flagship projects,” he said, citing an earlier NEDA statement that 45 projects funded through foreign loans or grants were classified as problematic.
Meanwhile, Mr. Balisacan said NEDA was determining the process for undertaking the review of rice tariffs every four months. Rice import tariffs were cut to 15% following the issuance of Executive Order No. 62, but are subject to periodic review.
“We are already preparing the methodologies on how to undertake that review, so we don’t necessarily waste time,” he said, adding that NEDA should be able to give the President timely updates. — Kyle Aristophere T. Atienza
PHL to allow yellow onion imports of up to 16,000 MT
THE Department of Agriculture said on Wednesday that it will allow yellow onions imports of up to 16,000 metric tons (MT) until the end of the year.
“We approved it on Monday because our stocks will be depleted, but we still have ample supply of red onions,” Agriculture Secretary Francisco P. Tiu Laurel, Jr. told reporters on the sidelines of a poultry and livestock event.
“Our red onion is good until March. So only a limited quantity of yellow onion will be imported, to stabilize prices,” Mr. Laurel added.
In July, Mr. Laurel extended the import ban on red onion until the end of August, with supply deemed sufficient until February 2025.
He said however that the supply of domestic yellow onions is sufficient only until the end of August.
In a draft memorandum, the Bureau of Plant Industry (BPI) said it will be issuing sanitary and phytosanitary import certificates (SPSICs) for the 16,000 MT of yellow onion, which is deemed sufficient until the end of 2024.
“With the upcoming holiday season and harvest commencing in January 2025, it is expected that the demand for yellow onion will increase. Given that the supply is very limited, it can lead to an increase of price in the market,” it said.
Mr. Laurel said the import order is timed not to disrupt the market during the harvest early next year.
“By the end of this week or early next week, the imports will come in but in limited quantities. We are doing it in batches, so the market won’t be flooded,” he added.
Mr. Laurel said SPSICs will be issued every two weeks.
The national inventory of yellow onion amounted to 1,642.31 MT as of Aug. 9, according to the BPI. On the other hand, red onion volume was 99,512.1 MT.
The BPI added that the imports were calibrated with reference to monthly per capita consumption, and will serve as a buffer to stabilize market prices.
“Possible extension of the must-arrive date will still be subject to change depending on the availability of stocks and prices,” it added. — Adrian H. Halili
Labor rights violations seen requiring more CHR funding
BUSINESS GROUPS and unions expressed support on Wednesday for increasing the budget of the Commission on Human Rights (CHR) to allow it to look into more labor-related human rights violations and provide support to victims.
In a joint statement, six business groups led by the Philippine Chamber of Commerce and Industry (PCCI) said more funding will give the CHR the resources to better monitor labor-related human rights violations.
They said more funding is needed to support a witness protection program pending the resolution of the cases, as well as to expedite the release of reparations to victims.
“We reiterate our earlier call for the government to continue the investigation, prosecution, and disposition of all labor-related cases affecting freedom of association and collective bargaining, without delay and in the interest of justice,” according to the joint statement.
The Department of Budget and Management approved a budget of P1.07 billion for the CHR in the National Expenditure Program 2025.
This excludes the P53.55 million for the Human Rights Violations Victims’ Memorial Commission, bringing total appropriations for the CHR to P1.12 billion.
The groups also proposed that the Inter-Agency Committee (IAC) for the Protection of the Freedom of Association and Right to Organize of Workers, which was established through Executive Order No. 23, offer quarterly progress reports.
“Such a regular interface may serve as a means to be updated and apprised on the progress made by the IAC in the discharge of its functions,” the groups said.
The six groups also requested a review of the continued operations of the National Task Force to End Local Communist Armed Conflict to avoid overlaps with other agencies.
The joint statement was also signed by the Employers Confederation of the Philippines, Philippine Exporters Confederation, Inc., the Federation of Free Workers, Sentro ng mga Nagkakaisa at Progresibong Manggagawa, and the Trade Union Congress of the Philippines. — Justine Irish D. Tabile
Contract awarded to expand, improve Butuan’s Masao port
MINDANAO-BASED contractors have won the P498.09-million contract to expand and improve Butuan’s Masao port, the Philippine Ports Authority (PPA) said.
In a notice of award, PPA said the winner is the joint venture of Evenpar Construction and Development Corp. and UKC Builders, Inc.
“You are hereby instructed to formally enter into contract with us and to post the required performance security in the form and the amount stipulated in the instruction to bidders, within 10 days from the receipt of this notice of award,” PPA General Manager Jay Daniel R. Santiago said.
PPA said failure to enter into the contract and to provide the performance security will cancel the award. The contractor is required to complete the project within 720 calendar days, the PPA said in its invitation to bid.
In the next four years, or until 2028, the PPA is allocating about P16 billion to fund infrastructure works, including 14 flagship projects. — Ashley Erika O. Jose