Statement of Goldilocks on scrapped takeover deal with SM Retail
Below is a statement released by Goldilocks President Richard L. Yee on the scrapped acquisition deal with SM Retail:
“I would like to confirm reports in the media that the partnership between Goldilocks and the SM group will no longer push through. This was a mutual decision, which was jointly agreed upon after friendly and productive dialogue. Since we first began talks with SM, so much has happened in the marketplace, and many changes have occurred in our respective business environments. This caused us to re-evaluate our position, and to arrive at a decision that we feel is best for both companies.
We would like to thank the SM group for their intent to partner with us. This is yet another validation of our efforts to strengthen our leadership position. To this end, we remain focused on our plans and strategies, which has allowed us to achieve double-digit growth in the past few years. We now have over 600 stores to serve our customers nationwide, and we will continue this expansion in order to be more accessible to our customers.
Goldilocks has always been committed to serving our customers with the best products wherever they may be and we remain steadfast in that commitment.”
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Blockchain & Bitcoin Conference Philippines
Manila to host Blockchain & Bitcoin Conference Philippines
On January 25, Manila for the first time will host Blockchain & Bitcoin Conference Philippines, an event dedicated to cryptocurrency, blockchain and ICO.
Philippines is a pioneer in the digital assets regulation
At the end of November 2017, the Philippines` Securities and Exchange Commission announced its intention to introduce cryptocurrencies in the legal field. This means that soon the state can become one of the pioneers in the field of regulating digital assets. Legislative security will positively affect the popularity of the Philippines in the crypto community.
Participants are crypto industry professionals
Crypto experts from all over the world will take part in the event: representatives of financial institutions, bankers, entrepreneurs, investors, lawyers, developers of blockchain solutions, startups and professional traders.
Guests will enjoy not only the conference, but also an exhibition
The event takes place in the format of a conference + exhibition, which simplifies the search for potential business partners. Within the conference, speakers will discuss legislative changes in the field of cryptocurrencies and tokens in the Philippines, share the experience of preparing a startup for the ICO, advise which digital assets should be invested in the new year and tell about the benefits of blockchain for business.
Representatives of the international crypto community will gather in the exhibition area: suppliers of mining equipment and farms, crypto exchanged, blockchain projects and investment funds.
The event is held by the international company Smile-Expo
The organizer of the event is Smile-Expo, the company that conducts events of the Blockchain & Bitcoin Conference network in 15 countries of Europe and Asia.
Venue: Edsa Shangri-La Hotel, Manila.
Follow the news on the official website of Blockchain & Bitcoin Conference Philippines
Money20/20 Asia: Launching March 2018 in Singapore
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Money supply, lending growth eases
By Melissa Luz T. Lopez
Senior Reporter
GROWTH of money supply slowed in December as the increase of bank lending eased and as the government issued retail bonds, the central bank reported yesterday.
At the same time, year-on-year growth of bank loans for production activities — accounting for more than 88% of the total — steadied in December from the preceding month, while lending for household consumption slowed.
Domestic liquidity, as measured by M3 which is the broadest indicator of money in an economy, expanded by 11.9% to P10.6 trillion last month, the Bangko Sentral ng Pilipinas (BSP) said in a statement.
The rate eased from the 14% climb recorded in November, and is the slowest since an 11.5% increase in May 2017. Month on month, liquidity actually slipped by 0.7%.
Funds drawn from domestic sources went up by 13.4% in December, slowing from the preceding month’s 14.7% pace.
This was largely due to a slower pickup in lending to the private sector at 15.7%, coming from a 16% increase.
The government’s issuance of P255.4 billion in retail Treasury bonds also ate into money supply at end-2017, as the state placed these fresh funds as deposits under the BSP. Amounts drawn from these five-year papers will pre-fund the spending needs of the current administration in 2018 as it takes on more big-ticket infrastructure projects.
As a result, net claims on the central government grew by a mere 2.2%, coming from November’s 10.2% pace.
Meanwhile, net foreign assets computed in peso terms grew by a faster 2.3% from 1.9%, reflecting increased dollar inflows from higher cash remittances from overseas Filipino workers, outsourcing receipts and bigger foreign portfolio investments, the BSP said.
Foreign assets held by banks expanded at a slower pace due to lower interbank lending and deposits.
LENDING GROWTH SLOWS
December also marked the third straight month of softer growth in bank lending, even as it remained at double-digit level.
Credit growth clocked 19% in December, slower than the upward-revised 19.3% pace in November. That was the slowest increase since May 2017’s 18.7%.
Computed to include reverse repurchase agreements held by banks, total lending picked up by 18.1%, a tad slower than the 18.4% clocked in November.
Roughly 88.9% of bank credit went to production, growing by 18.5% — keeping November’s pace.
Loans extended to the electricity, gas, steam and air-conditioning supply sector surged by 25.4% to post the biggest increase during the month.
This was followed by increases in credit to wholesale and retail trade, repair of motor vehicles and motorcycles (20.1%); real estate (19.3%); as well as financial and insurance activities (16.8%).
Manufacturing also saw its loans from banks pick up by 11.7%, according to latest available central bank data.
Meanwhile, loans extended to administrative and support services as well as to the agricultural sector dropped by 30.4% and 13.7%, respectively.
Consumer lending also eased further to 17.2% in December, coming from a 20.6% climb a month before. This came as the grant of salary-based and car loans decelerated, despite bigger credit card and other household loans.
The central bank keeps a close watch on liquidity and bank lending dynamics to ensure price and financial stability.
The International Monetary Fund as well as some economists have flagged overheating risks for the Philippine economy amid sustained double-digit expansion in bank credit.
However, central bank officials said such fears are overdone, as the robust lending simply reflects increased domestic activity.
The Philippine economy grew by 6.7% in 2017, keeping it one of the fastest-growing in Asia.
“I think both domestic liquidity and bank lending growth have remained strong despite a slowdown in December. I do not think the economy is overheating since inflation has remained steady and manageable in December,” Security Bank Corp. economist Angelo B. Taningco said via e-mail when sought for comment.
“As there’s still enough domestic liquidity with inflation expected to drift towards the upper end of the government’s inflation target range, an RRR (reserve requirement ratio) cut is unlikely to be made in the near term.”
He is referring to the central bank’s plan to trim the 20% reserve standard imposed on big lenders, which is among the highest in the world.
BSP Governor Nestor A. Espenilla, Jr. said earlier this week that there is no need for such fresh stimulus from the regulator for now since the financial system is awash with cash.
PHL tagged among those enabling illegal fund flows
THE PHILIPPINES was counted in the upper third of a list of jurisdictions that “contribute to the secrecy that enables illicit financial flows.”
The Philippines placed 40th among 112 jurisdictions in the Tax Justice Network’s Financial Secrecy Index 2018 that was released yesterday. The biennial report is the fifth since 2009 released by the Tax Justice Network, which describes itself as an “independent international network” launched in 2003 to “conduct high-level research, analysis and advocacy on international tax… and on the impacts of tax evasion, tax avoidance, tax ‘competition’ and tax havens.”
The index uses a 0%-100% scale for financial secrecy, with 0% score denoting 100% transparency and the maximum 100% score equivalent to 0% transparency. Each jurisdiction is gauged against 20 key financial secrecy indicators (KFSIs) grouped into four “dimensions of secrecy,” namely: ownership registration, legal entity transparency, integrity of tax and financial regulation as well as international standards and cooperation.
The Philippines got an overall secrecy score of 65.38% but had a “small” 0.09% share in global financial services exports, hence its relatively middle rank on a list topped by Switzerland, the United States (which had a better 60% secrecy score but had the biggest 22.30% share) and the Cayman Islands. “The Philippines accounts for less than one percent of the global market for offshore financial services, making it a small player compared with other secrecy jurisdictions,” the report explained.
The Philippines was rated 100% secretive in all five KFSIs under the legal entity transparency dimension; in “recorded company ownership,” “limited partnership transparency” and “tax court secrecy.” It got the best score of 0% in terms of “consistent personal income tax” and “avoids promoting tax evasion.”
Finance department sees fiscal health intact despite project pickup
By Elijah Joseph C. Tubayan
Reporter
THE DEPARTMENT of Finance (DoF) believes that despite the acceleration of some foreign-bankrolled infrastructure projects this year, the government should be able to sustain fiscal stability over the medium to long term.
Finance Secretary Carlos G. Dominguez III said in a statement yesterday that “about a fourth of the capital needed for the Duterte administration’s P8.44-trillion infrastructure modernization program” will tap the additional revenues from Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion Act (TRAIN), while the rest will be funded by Official Development Assistance (ODA).
“I am sure the projects that have been planned for the DPWH (Department of Public Works and Highways) are going to go into high gear now that we have basically our capital already, our own funding for our portion of these projects,” Mr. Dominguez said, referring to the TRAIN that took effect this month.
“And I guess this will also encourage the multilateral agencies and the other funding agencies to increase their lending to us.”
Finance Undersecretary and chief economist Gil S. Beltran said yesterday that “in the short-term, the government’s ’Build Build Build’ Program may exert upward pressure on the debt stock.”
“There’s a big chunk of projects that will start this year. Tataas ’yung debt stock mainly because these are funded by a mix of GAA (General Appropriations Act) and ODA,” Mr. Beltran explained in an interview yesterday.
He said that there are 68 infrastructure projects under construction and in pre-construction phase this year.
Of this complement, 46 worth P664 billion are financed by a budget-ODA mix according to Mr. Beltran.
“In the medium- to long-term, however, a sustainable high economic growth rate (brought about by better infrastructure) will outrun the growth of debt,” Mr. Beltran said.
He added that the smaller-than-expected incremental revenue from the TRAIN should not pressure the government’s fiscal portfolio this year.
“We approve projects on the basis of programmed resources available. Those were not programmed before, so it’s only now start adding into program,” he said.
The DoF expects about P90 billion additional revenues this year from the first tax reform package — about two-thirds of the original P130 billion target.
According to the law, 70% of the additional revenues will be earmarked to infrastructure projects.
It is also confident that Congress could approve within this quarter a tranche providing for estate and general tax amnesties, the easing of bank secrecy restrictions and the increase in the Motor Vehicle Users Charge.
“So there’s no effect. If ever there will be, the debt will remain manageable. Kasi naka-fix na ’yung budget deficit at 3% (of gross domestic product),” said Mr. Belran.
Moreover, Mr. Dominguez said in the statement that the government’s debt as a share of the country’s gross domestic product (GDP) would continue to decline.
“When we took over, it was something like 43%. Even though we borrowed more during the interim from when the time this new administration took over, the debt as a percentage of GDP is now just slightly over 41%,” the finance chief said.
“And we can see that declining over the years.”
The Bureau of the Treasury reported on Monday that the government recorded a P6.652 trillion outstanding debt in 2017, 9.2% more than 2016’s P6.09 trillion to breach the P6.47 trillion target under the Budget of Expenditures and Sources of Financing. It also noted that the government saw a 42.1% debt-to-GDP ratio last year.
“From a high of nearly 75% in 2004, debt-GDP ratio was drastically reduced to below 45%, owing to prudent debt management, fiscal discipline, and economic growth. The economy has been outgrowing debt in the past years, meaning, the country’s capacity to service its debt has been improving,” said Mr. Beltran.
The government’s 75 flagship infrastructure projects set to start this year include the P211.46-billion Philippine National Railway (PNR) North 2, the P134 billion PNR South Commuter Rail and the Clark International Airport expansion.
Projects to commence construction also include the P19.8-billion Davao City Bypass Road,the P23-billion Metro Manila Flood Management Project, the P151-billion PNR South Long Haul Line and the P355.6-billion Mega Manila Subway.
The Duterte administration shifted away from the pure public-private partnership (PPP) mode of implementing infrastructure projects due to delays. Instead, it has decided to use a combination of state funds and ODA for the construction phase and PPP for operation and maintenance.
The government aims to spend some P8 trillion on infrastructure until 2022, when President Rodrigo R. Duterte ends his six-year term, to boost economic growth to 7-8% starting this year.
World marts can absorb some trade turbulence as Donald Trump digs in
LONDON/GENEVA — Booming global trade and economic growth have cushioned world markets against the political turbulence of Donald Trump’s first year in the White House, but that resilience will be tested if the US president wants protectionism to define 2018.
With stocks on one of their longest bull runs in history, they are particularly vulnerable to upsets, although the global economy’s strength means they could probably absorb greater trade conflict — provided governments keep it all within limits.
Emboldened after finally pushing his signature tax cut reforms through Congress, Mr. Trump seems likely to train his sights on trade — another pillar of his election pledge to “Make America Great Again” — by fixing its deficit and punishing countries deemed to be profiting at US expense. His administration is beating the trade drum ever louder. This month it has announced steep US tariffs on imported washing machines and solar cells, Commerce Secretary Wilbur Ross has warned China over intellectual property practices and Treasury Secretary Steve Mnuchin has endorsed a weaker dollar to help American exports.
Discussing trade wars at the World Economic Forum in Davos, Mr. Ross said: “US troops are now coming to the ramparts.”
That warning provoked only a short-lived wobble in world stocks, with investors reluctant to bail out of a market still clocking record highs at an accelerating pace even after adding $9 trillion in value last year.
Much of that bullishness is down to a sustained rebound in trade in recent years, with volumes growing at a faster pace than world gross domestic product.
Despite Mr. Trump’s protectionist rhetoric of the past year and actions such as pulling the United States out of the Trans Pacific Partnership trade pact for Pacific rim countries, indicators show no let up.
Global trade is expanding at annualized rates of more than four percent, the strongest performance since 2011, according to the Netherlands Bureau of Economic Policy Analysis. Freight volumes are surging at the fastest pace this decade.
Merchandise trade is likely to have expanded 3.6% in 2017 in volume terms, rebounding from the post-crisis low of 1.3% growth in 2016, the World Trade Organization reckons. Overall, the International Monetary Fund forecasts global gross domestic product (GDP) will expand 3.9% this year.
But investors fear a shift from rhetoric to action may still hurt markets even if the robust growth acts as a shock absorber.
“Protectionism means lower growth and higher inflation. That’s the worst possible combination you can have when markets are at record highs,” said Luca Paolini, chief strategist at Pictet Asset Management.
However, the world economy’s strength and double-digit company earnings allow markets to “absorb a lot,” Mr. Paolini said.
He cited short-lived reactions to Britain’s impending exit from the European Union, political upsets elsewhere on the continent such as Catalonia’s failed referendum on independence from Spain and North Korea’s nuclear weapons program as examples of how much flak the market was able to take.
Protectionism is neither new nor a US monopoly. Since 2008, the 60 top world economies have adopted over 7,000 protectionist trade measures in net terms, international law firm Gowling WLG reported last November. And yet these have failed to scupper the bull market in equities.
Among the upcoming flashpoints are talks with Mexico and Canada on Mr. Trump’s demand that the North American Free Trade Agreement (NAFTA) be renegotiated.
A US Treasury report on trade partners’ currency practices, plus decisions on steel and aluminium import restrictions, are due in April.
“(A trade shock) is something you have to keep in mind, given how stretched markets are but there has to be a credible decision, not just a threat,” Mr. Paolini said.
Most expect forthcoming curbs, and the fallout, to be limited.
Trade wars have had little direct impact on equity markets in the past, JPMorgan analysts wrote, citing a dispute between Washington and Tokyo in 1993-95 over Japanese car exports to the United States as an example.
Mr. Trump could double or triple the number of trade penalties “without harming risky markets more than intra-week,” they said, adding that they had made no portfolio changes to account for additional trade risks.
Even 100% tariffs on steel and aluminium would dent Chinese exports by just 0.3 percentage points, while semi-conductor and telecommunications import curbs may cut exports by 0.8 percentage points, Morgan Stanley said.
Given multinational firms’ reliance on complex cross-border supply chains, Wall Street would undoubtedly suffer but other markets may be hurt more.
The United States, relying on trade for 28% of its economic output, has less to lose than Mexico, with a trade-to-GDP ratio of 78% or Germany with 84%. China’s ratio is 34%, World Bank data show.
As a result, any US pullout from NAFTA would cut 2019 GDP by half a percent in the United States, while reducing Mexico’s by almost one percent, Oxford Economics predicts, adding that Mexico’s economy could be two percent smaller by 2022.
However, it is Asia that accounts for three-quarters of the US goods trade deficit — led by China, South Korea and Japan — and over a third of global exports. The annual deficit with China at $370 billion is the biggest, implying that this is where Mr. Trump and Mr. Ross have set their sights.
Some analysts argue that the United States would also lose if trade partners retaliated by cutting purchases of American goods or halting supplies of components to US firms, perhaps along the lines of the China’s decision in 2010 to ban exports of rare earth metals to Japanese electronics makers.
Another threat lies in the quest for a weaker dollar, should that spur inflation by pushing up the cost of imports in the United States. This could prompt faster, bigger rises in interest rates that feed through to equity markets.
But Mr. Trump may be wary of disrupting the equity boom which he has cited as evidence of his administration’s successful policies.
“At today’s (share price) valuations, a trade war would be material,” said Andrew Milligan, head of global strategy at Aberdeen Standard Investments.
“I’m sure he’s received a lot of advice that a trade war would damage the Dow.” — Reuters
BSP to offer 28-day deposits anew next week amid liquidity
By Melissa Luz T. Lopez,
Senior Reporter
THE CENTRAL BANK will revive month-long term deposits this month, as overwhelming demand for the seven-day tenor continued to fetch lower yields during this week’s auction.
Banks again swarmed the seven-day term deposits offered by the Bangko Sentral ng Pilipinas (BSP) yesterday, which drove average rates lower for the seventh straight week.
Demand for the week-long instruments reached P116.634 billion, a tad below the P119.582 billion tenders received during the Jan. 24 auction and nearly triple the P40 billion which the central bank wanted to sell.
The strong appetite for the week-long term deposits drove rates to slip further to average 2.7785%, lower than the previous week’s 2.9256% as banks asked for returns from a narrow range of 2.7-2.85%.
The term deposit facility (TDF) is currently the central bank’s main tool to capture excess liquidity in the financial system. The window allows banks to park the idle cash they hold under the BSP in exchange for a small margin, which in turn will prod market rates to move closer to the three percent benchmark set by the central bank.
For next week, the central bank will reopen the 28-day tenor with a P20-billion offering. This is lower than the P40 billion when the month-long term was last offered on Dec. 13.
This brings the auction volume next week to P60 billion, coupled with another P40 billion worth of week-long instruments.
BSP Deputy Governor Diwa C. Guinigundo said market players have expressed interest in the 28-day term as they now have more cash to spare coming from some tightness in supply last December.
“We are seeing the return of liquidity to the banks after the holiday season and the impact of the sustained release of public funds for infrastructure and other social projects,” Mr. Guinigundo said in a text message to reporters.
“The BSP has more liquidity to bring back to its TDF facility on top of the overnight deposit facility and the RRP (reverse repurchase) facility and in the process ensure appropriate level of domestic liquidity and price stability. Hence, a gradual adjustment in the TDF volume was announced.”
Mr. Guinigundo said the BSP is in talks with banks to possibly introduce a new tenor for the TDF. Some analysts said a 14-day length may be the viable option, as market players continue to prefer short-term instruments as it provides accords greater flexibility in deploying these funds.
As practiced, any excess cash which have not been deployed for loans, foreign exchange and debt payments are parked under the central bank window in order to realize gains, rather than leave these idle inside vaults.
The BSP Monetary Board has kept its policy stance unchanged since September 2014, although procedural changes were introduced in June 2016 for the shift to an interest rate corridor. Benchmark rates currently range from 2.5-3.5%.
Analysts have been flagging the need for the central bank to tighten rates to keep up with rising inflation and contain the buildup of risks in the financial system.
Ayala Land aims to neutralize its carbon footprint by 2022
By Krista A.M. Montealegre,
National Correspondent
THE ENVIRONMENT is taking the spotlight in the boardroom of Ayala Land, Inc. (ALI), as the Philippine property giant works on incorporating more sustainable practices in its business to neutralize its carbon footprint by 2022.
Ayala Land has committed to undertake an aggressive carbon-neutral program that will offset the projected 490,000 tons of carbon emissions from its commercial properties by 2022, ALI Sustainability Manager Anna Maria M. Gonzales said in a briefing on Wednesday.
These emissions are generated through the company’s activities such as fuel burning and energy consumption.
Given its presence in 55 growth centers, Ayala Land said the program reflects its commitment to sustainable and responsible property development, recognizing the need to address and mitigate the impact of its development and expansion plans to the environment.
To achieve its goal, Ayala Land is embarking on a three-pronged approach by dedicating 450 hectares of its land bank to carbon forests along with efforts to implement passive cooling design in its developments, and shift to renewable energy.
By the end of the program, the real estate company expects the usage of renewable energy in its malls, offices and hotels to increase to 80% from the current 10%.
Ayala Land is setting aside 4.5% of its land bank to forests with the capacity to hold 68,000 tons of carbon dioxide equivalent across five sites located in different parts of the Philippines.
Forests sites in Lio and Sicogon are integrated into the estate’s master plan, while the Alaminos site lies north of a BellaVita subdivision. The Kan-Irag and Talomo sites are located in the cities of Cebu and Davao.
And the cost of its pledge to develop carbon forests? Ayala Land is spending a mere P42 million until 2022 — an insignificant amount compared to its planned P88-billion capital spending last year.
“It is very affordable, that’s why we hope other people can do it,” Ms. Gonzales said.
The developer worked with the Center for Conservation Innovations, Inc. for a study to determine the baseline carbon stock in these carbon forest sites.
Through a process called carbon sequestration, the carbon forest sites remove carbon dioxide from the atmosphere. Although forests do release carbon dioxide from their natural processes, a healthy forest typically stores carbon more than it releases it.
The study also identified the best protection and enhancement approach through assisted natural regeneration (ANR) and other methods to maximize the carbon storage potential for each site.
ANR initiatives are activities that support forest regrowth through protection, tending of diverse native wildlings found on site and enhancement planting of other indigenous species.
ALI has partnered with community-based, nongovernment organizations like Pusod, Inc., Soil and Water Conservation Foundation and Philippine Eagle Foundation.
“We believe our carbon forest is not exactly a product but it is still another way of creating value for the environment and for us give back to the communities that have been hosting us all these years,” Ms. Gonzales said.
Ayala Land has been tracking its greenhouse gas emissions among other environment, social, governance metrics throughout the various stages of its project development process. Its sustainability report is reviewed by DNV GL, a Singapore-based global quality assurance and risk management company.
Shares in Ayala Land slid P1.35 or 2.96% to end at P44.25 apiece.
Robinsons Bank sets P730-M capex plan
By Karl Angelo N. Vidal
ROBINSONS BANK Corp. is allotting P730 million for capital expenditures (capex) this year to fund its digital initiatives, branch expansion and cybersecurity measures.
“[We are alloting] P730 million capex for 2018,” Robinsons Bank President and Chief Executive Officer Elfren Antonio S. Sarte told reporters in a reception held in Bangko Sentral ng Pilipinas (BSP).
Mr. Sarte said the amount will cover the lender’s digital initiatives and branch expansion.
“We have a couple of initiatives that will push or make our digital banking strategies stronger. We’re also focusing in insuring we have digital strategy to support our growth,” Mr. Sarte said, but stopped short of giving more details.
He added that Robinsons Bank is eyeing to end this year with 150 branches, coming from 134 branches in 2017.
“We [now have] 136 [branches], I think. We have six in the pipeline and we should [be] ending at 150 by the end of 2018,” he said last week, adding that the lender will “also spend some money for cybersecurity.”
Asked where will the funds be sourced, Mr. Sarte said in a mobile phone message yesterday: “We expect to have enough cash profit for 2018 to cover the projected capex.”
Earlier this month, the banking arm of the Gokongwei’s JG Summit Holdings, Inc. signed a bancassurance partnership with British life insurer Pru Life UK to bolster the bank’s product offerings.
The three-year partnership of Robinsons Bank and Pru Life UK is expected to generate approximately P40 million to P50 million in premiums in the first year.
Mr. Sarte also noted he is expecting that the bank exceeded P100 billion in assets in 2017.
“In fact, the bank has been growing fast. For 2017, I think our numbers will exceed P100 billion in terms of assets.”
As of end-September 2017, Robinsons Bank ranked as the 19th biggest commercial bank in asset terms with P94.41 billion, BSP data showed.
FUND RAISING
Meanwhile, Mr. Sarte added in a text message that the bank is considering to offer long-term negotiable certificates of deposits (LTNCD) this year.
“We are considering offering LTNCD this year but [it is] still early to confirm since we have to get board approval,” he said in a text message.
He added that the proceeds will be used to support the growth of the bank’s loan business should they proceed to offer LTNCDs.
Like regular time deposits offered by banks, LTNCDs offer higher interest rates. However, LTNCDs cannot be pre-terminated but can be sold on the secondary market, making them “negotiable.”
In June 2017, Robinsons Bank raised P4.182 billion from its first-ever LTNCDs, more than the initial P3 billion offer size, on the back of strong demand.
Earlier, Philippine National Bank, East West Banking Corp. and UnionBank of the Philippines announced they will be offering LTNCDs in 2018.
Pinoy entrepreneurs create online marketplace for travel activities
By Zsarlene B. Chua,
Reporter
THE ENTREPRENEURS behind an app focused on offering travel activities in the Philippines are hoping to expand in six other countries in the next two years.
“[Bliimo] is an app developed in the Philippines meant to provide a seamless flow of adventures and experiences for customers and seamless flow of business for merchants,” Ronn Mitchell Esguerra, founder and CEO of Bliimo, told the media during its launch on Jan. 27 in Subic, Zambales.
“The initial idea [was to create and app] to book tour guides and we realized it was complicated, so we thought why not go a little more upward. So we came up with the idea of what people need — itinerary planning,” he explained.
Bliimo is envisioned as a marketplace selling travel activities such as renting a boat for island-hopping, booking a massage, and getting a helicopter ride from Mactan to Bohol.
According to its Web site, Bliimo aims to “reduce the hassle of planning trips by not only providing you with a fully integrated platform to book your adventures but also by letting you unbundle your itinerary and customize it the way you want it.”
It currently offers 186 travel activities, but its creators expect the number to go up to around 400 within the month.
The name Bliimo — according to James Leonard Cruz, cofounder and chief revenue officer — refers to an expression his friends say whenever they attempt and/or succeed in something awesome.
Mr. Esguerra said Bliimo also hopes to give small businesses a chance to compete, as many boat men or small diving shop owners typically don’t have budgets for marketing and promotion.
This, he explained, is also the reason why the company charges low commission rates and currently has no sign-up fees, though merchants must undergo a multi-step verification system.
“We only get 10% and even as low as 4% as the price increases. We also don’t meddle in the pricing of the activities,” said Mr. Cruz.
Experience-focused apps appear to be the future of travel as Hong Kong-based travel experience app Klook managed to raise a total of $96 million which the company means to use to fund its global expansion efforts to the US and Europe.
Klook recorded five million bookings in 2016. In 2017, it averaged one million bookings per month, 70% of which were made using mobile devices, according to a TechCrunch article published on Oct. 25, 2017.
Bliimo is said to offer a more flexible itinerary feature, a technology the founders developed with P10 million, which was privately funded.
“With us, it’s a simple drag and drop and you can customize your itinerary (and the number of people joining) by the hour,” Mr. Esguerra said.
“Our main market are millennials. These people are always on the go, always busy and that’s what we’re trying to solve,” said Mr. Cruz.
Aside from simple itinerary planning, Bliimo also functions as a social media app where users, once they book their passes, can tag their friends on the app and send them their passes.
The app does not have a recommendations feature, instead replacing it with a feature that shows people who have tried the activity.
“What we have are people you may know that have already tried these experiences. So the credibility of the merchant can be increased by virtue of human connection,” Mr. Esguerra told BusinessWorld, adding that reviews for experiences will also be from people who have been verified to have booked and gone on the activity.
In the spirit of flexibility, payment methods are varied: from online banking to Bayad Centers to PayPal. Payments also undergo a three-day holding period before being turned over to the merchants in case of disputes.
“As long as it accepts money, we’re there. If you look in the app, we even accept payment in Bitcoins,” said Jesus Paolo Montero, Bliimo cofounder and chief technology officer.
Mr. Esguerra said while the company is not limiting itself to the Philippines, they plan on getting more merchants and experiences within the country before expanding into other markets in two years.