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Party-list lawmaker tops net worth of House members with P7 billion

1PACMAN Party-list Representative Michael Odylon L. Romero is the richest member of the House of Representatives, according to the recently published statements of assets, liabilities and net worth (SALNs) of House members dated as of Dec. 31, 2016.

But according to a report by interaksyon.com, Mr. Romero, who is caught in a legal battle with his father, Reghis Romero II, over control of Harbor Centre Point Terminal Inc., “has not been seen in plenary sessions or hearings since his last attendance was entered in the journal of records December last year.”

Mr. Romero, a first-term lawmaker, has a declared average net worth of P7 billion.

He is followed by Representative Emmeline Aglipay Villar with a net worth of around P1.4 billion. Mrs. Villar is the wife of Public Works and Highways Secretary Mark A. Villar, who topped the list of the richest Cabinet members of President Rodrigo R. Duterte with a net worth of P1.4 billion.

Rounding off the top five richest members of the House are Alfredo Abelardo Benitez from the 3rd District, Negros Occidental with an average net worth of P943 million; former first lady and Ilocos Norte Representative Imelda R. Marcos with about P918 million; and former House speaker and Quezon City Representative Feliciano R. Belmonte with about P852 million.

Former Philippine president and incumbent Pampanga Representative Gloria Macapagal-Arroyo is the 11th richest with a net worth of about P435 million.

House Speaker Pantaleon D. Alvarez is at number 50 with a net worth of P86 million. House Majority Leader Rodolfo C. Farinas, on the other hand, is at number 25 with a net worth of about P169 million.

At the bottom of the list is Kabataan Representative Sarah Jane I. Elago with a net worth of P50,000.00. — with Mario M. Banzon

Some P3 billion spent in offensive against Maute group: Lorenzana

By Ian Nicolas P. Cigaral, Reporter

THE Philippine government has so far spent about P3 billion in the still ongoing military operations against Islamic State (IS)-inspired militants that overran the southern city of Marawi, provincial capital of Lanao del Sur, according to the country’s Defense chief.

Clashes between government forces and the pro-Islamic State (IS) Maute extremists broke out in Marawi on May 23 — triggering what may be the biggest internal security crisis in the Philippines since the Zamboanga City siege in 2013 and that prompted President Rodrigo R. Duterte to declare martial law in Mindanao.

The bloody standoff enters its 82nd day today.

In an interview with reporters on Thursday, Aug. 10, Defense Secretary Delfin N. Lorenzana said the government shelled out “roughly” P3 billion in its continuing offensive against the terrorist Maute group.

Mr. Lorenzana said the funds spent were sourced from “other projects” and he expressed the hope that Congress would “replenish” the ongoing military operation via the procurement of more equipment like bullet proof vests, helmets, and night vision goggles.

“I think we are facing the Congress in a couple of weeks,” the Defense chief said.

“Pero kailangan pa rin natin ng malaking pera siguro to develop our human intelligence on the ground kasi kailangan natin yun,” he added. (But perhaps we still need a lot more money to develop our human intelligence on the group because that’s needed.)

Last month, Congress overwhelmingly voted to extend Mr. Duterte’s martial rule in Mindanao until yearend to defeat the band of jihadist fighters that occupied the predominantly Muslim city and to dismantle the terror network in the region.

As of Aug. 10, the number of enemies neutralized by pursuing state forces in Marawi rose to 552 while civilians killed by the Maute group remained at 45. Meanwhile, 128 troops were killed in the clashes.

According to Mr. Lorenzana, ground commanders reported to him that the urban warfare might end in “one to two months.” Nonetheless, he said he reminded them not to rush to avoid more government casualties.

“We don’t want them to be killed,” he said.

Philippine builder gets contract for $980-M Indonesian LNG terminal

ATLANTIC, Gulf and Pacific Co. (AG&P) will build and operate a $980-million liquefied natural gas (LNG) receiving terminal in Bantaeng, South Sulawesi that will provide fuel to a 600-megawatt (MW) power plant in the same area in Indonesia, the Philippine-based company said on Friday.

In a statement, AG&P said the modular components of the terminal will be constructed at its manufacturing facilities in Batangas province, south of Manila.

It said the LNG-receiving terminal will serve the industrial tenants of the Bantaeng Industrial Park (KIBA), which has signed a deal on Friday with Indonesia-based PT Energi Nusantara Merah Putih (ENMP) for the development plan of the power plant.

“AG&P is thrilled to support this nationally important project in Bantaeng. We look forward in short order to LNG being available for the power plant and to industry and consumers throughout Southern Sulawesi and nearby regions. AG&P will work hard to achieve this goal,” Abhilesh Gupta, AG&P chief finance officer and commercial head, was quoted as saying in a statement.

ENMP unit PT. Pasifik Agra Energic is the owner and developer of the integrated LNG receiving terminal, which will provide natural gas to the plant, AG&P said.

Another subsidiary PT. Power Merah Putih is the owner and developer of the 600-MW power plant, which will provide energy to KIBA, it added. “ENMP and its partners will also strive to develop Bantaeng as the center of LNG distribution for the central and eastern Indonesia region,” it said.

AG&P said the project is currently in the engineering phase and is expected to reach financial close within a year. It said the construction of the LNG terminal and power plant will follow.

“By encouraging the development of industrial-based areas like the KIBA, Bantaeng will become one of the largest nickel processing centers in the world and will contribute significantly to the economy of Indonesia and South Sulawesi, and particularly the regency itself,” AG&P said. — Victor V. Saulon

Gov’t defends Cayetano’s remarks on China’s island-buildup amid US report to the contrary

By Ian Nicolas P. Cigaral, Reporter

THE Philippine government on Friday sought to explain recent remarks by the country’s top diplomat that China has stopped its land reclamation work in the disputed South China Sea, which was debunked by a US think tank.

At the end of the Association of Southeast Asian Nations (ASEAN) Ministerial Meetings in Manila, Philippine Foreign Affairs Secretary Alan Peter S. Cayetano said that using tough language to pressure China is not reflective of the current situation because it is “not reclaiming land anymore.”

In a statement, Foreign affairs spokesperson Robespierre L. Bolivar said the Philippines’ “position” on the maritime row is based on “latest intelligence” on the ground, adding that there are “no further reports” of Beijing’s island-building activities in waters that Manila disputed.

Mr. Bolivar was responding to a new report by the Asia Maritime Transparency Initiative (AMTI) of Washington’s Center for Strategic and International Studies, which qualified Mr. Cayetano’s statement as “false” by showing satellite images of China’s expansion in the sea “in recent months.”

To recall, Mr. Cayetano made the statement after admitting that the Philippines is one of the ASEAN countries that opposed making references to “land-reclamation” and “militarization” in the South China Sea in the bloc’s joint communique.

But the customary statement, which was belatedly released over reported disagreements by ASEAN foreign ministers, nevertheless called for “non-militarisation and self-restraint.”

According to Mr. Bolivar, Mr. Cayetano’s remarks “must be taken in its full context.”

He explained that Manila, as this year’s ASEAN chair, agreed with other regional foreign ministers to include international concerns over land reclamation in the communique despite the Philippines not getting reports about island buildups in features it claimed.

He said this is “in consideration of the probability that land reclamation may still be occurring or may yet occur in features in the South China Sea outside of the Philippine claim.”

“We would like to assure the public that if ever there are reports to the contrary, these will be carefully studied, verified and handled accordingly,” Mr. Bolivar said.

“As Chair of the ASEAN Ministerial Meeting, the Philippines’ primary goal was to ensure that the Joint Communique reflected the interests of the region and the ASEAN consensus,” he added.

“The foreign policy direction of the Philippines…is not to surrender a single inch of Philippine territory while at the same time working towards good neighborly relations with other claimants.”

China claims most parts strategic waterway, where trillion dollars’ worth of ship-borne goods pass through annually. But the Asian power’s maritime ambitions were challenged by the Philippines, another claimant nation, in the Permanent Court of Arbitration in the Hague that ruled in Manila’s favor.

For his part, Presidential Spokesperson Ernesto C. Abella told reporters yesterday that AMTI’s report should be “vetted for accuracy” and, if proven, should be taken up in future ASEAN discussions.

“[This is] to preserve the trust and confidence that all disputants over the territory in South China Sea,” he said.

BDO issue of LTNCDs oversubscribed, raising P11.8-B

BDO Unibank, Inc. (BDO) said it raised P11.8 billion from its long-term negotiable certificates of deposit (LTNCD), more than twice the original offer size amid robust demand for the debt paper.

In a disclosure to the bourse on Friday, the country’s largest bank in terms of assets announced it sold P11.8 billion worth of paper, well over the P5 billion initially planned. It calld the fund-raising exercise “the largest single issuance to date of LTNCDs by a local bank.”

Proceeds will be used to “diversify the maturity of its funding sources and support business expansion plans.”

Due to strong market appetite from its exercise, the bank was prompted to end the offer on Aug 10, a day ahead of schedule.

LTNCDs, like regular time deposits, offer higher interest rates but unlike time deposits, cannot be pre-terminated. Being “negotiable” means that these can be sold on the secondary market.

“Other features of the LTNCD include: a) tax exemption on interest income for individual investors if held for at least five (5) years; b) quarterly interest payments; c) deposit insurance coverage with the PDIC up to a maximum of P500,000 per depositor; d) negotiability subject to market conditions. The LTNCD issuance is part of the Bank’s efforts to diversify the maturity profile of its funding sources and support business expansion plans,” BDO said.

The instrument has a term of 5.5 years, maturing on Feb. 18, 2023, with an interest rate of 3.625% per annum. The issue date is Aug 18.

BDO tapped Deutsche Bank AG, Manila Branch and ING Bank N.V., Manila Branch as the Joint Lead Arrangers and Selling Agents for the offer with BDO and BDO Private Bank serving as selling agents.

BDO’s last LTNCD issuance was on April 2015, when it was able to raise P7.5 billion, higher than its initial offer size of P5 billion. The paper matures on Oct. 6, 2020 with a final interest rate of 3.75% per annum.

BDO’s net profit was little changed in the first six months of the year at P13.3 billion.

When one-offs are factored out, core earnings would have posted double-digit growth in the January to June period.

Consumer loans grew 17% year-on-year to P1.6 trillion in the first half.

Total deposits hit P2 trillion during the period, against P1.8 trillion a year earlier, driven by a 17% rise in its low-cost CASA deposits, which account for 73% of the bank’s total deposits.

Net interest income rose 22% to P38.6 billion in the first half. – Janine Marie D. Soliman

Second quarter profit flat at 7-Eleven licensee, but retail shows recovery signs

THE Philippine licensee of 7-Eleven convenience stores registered flat earnings in the second quarter of 2017 anchored on the recovery of same-store sales during the period.

Philippine Seven Corp. (PSC) reported a net profit of P288.3 million in the three-month period from P290 million a year ago, according to a disclosure to the stock exchange on Friday.

First-half net income fell 5.5% to P446.4 million from P472.3 million in 2016.

Same-store sales inched up 1.2% in the second quarter — a turnaround from the 2.5% decline in the previous quarter — arresting the first-semester decline to 1%. Election-related spending and other factors inflated sales in 2016.

Second-quarter system-wide sales climbed 19.4% to P9.68 billion from P8.12 billion, pushing the first-half tally up by 16.9% to P18.1 billion from P15.5 billion, anchored on the company’s aggressive store expansion nationwide.

7-Eleven expanded its store count by a fifth to 2,087 at end-June from 1,740 during same period in 2016. A total of 109 new stores were added in the first half against 17 closures.

Broken down, PSC has 1,686 outlets in Luzon, including 829 in Metro Manila. There are also 269 stores in the Visayas and 132 branches in Mindanao.

PSC said it is on course with its store expansion program by opening new stores in existing and new markets even if competition had slowed down, while noting favorable results of capacity building expenditures.

“The focus of the organization going forward will be on increasing sales per store. There are various programs lined up covering expanding merchandise assortment and launching of new food and beverage items to serve as differentiation compared with other channels,” the company said.

Shares in PSC were unchanged at P175 apiece on Friday. – Krista Angela M. Montealegre

North Korea’s missile threat a ‘source of concern’: AFP

By Ian Nicolas P. Cigaral, Reporter

NORTH Korea’s plan to launch missiles at the US Pacific territory, particularly near Guam, is a “source of concern,” the Philippine military said on Friday, Aug. 11, adding that the government is preparing for any kind of “telltale effect” from such aggression.

Speaking to reporters in Malacañang, Armed Forces of the Philippines (AFP) Spokesperson Brigadier-General Restituto F. Padilla, Jr. said that there is a “remote” possibility of North Korean missiles directly hitting the Philippines, but debris may splash into the country’s coastal areas.

Guam is located approximately 2,500 km away from the Philippines. It is home to some 42,800 Filipinos, according to the Department of Foreign Affairs (DFA).

“If ever it (missiles) disintegrates in the atmosphere. Potentially, it would have shattered debris that may scatter around in the area or its trajectory,” Mr. Padilla said.

“So it could hit some northern coastal areas. We have to forewarn our citizens to be on the lookout. But that’s something that we see as remote,” he added.

“We don’t have anti-missile systems to put it down or to guard our country against such kinds of threat. What we do, however, is monitor it.”

According to reports, Pyongyang’s state media recently said North Korea plans to fire four intermediate-range missiles into waters 30-40 km from Guam “to signal a crucial warning to the United States”.

Malacañang earlier assured the Philippine consulate in Agana, Guam, that it has “contingency plans” that are “regularly updated to enable them to respond to emergencies.”

At the just-concluded Association of Southeast Asian Nations (ASEAN) Ministerial Meetings in Manila, the regional-bloc said in a joint statement that Pyongyang’s previous ballistic missile launches and nuclear tests “seriously threaten peace, security and stability in the region and the world.”

North Korean Foreign Minister Ri Yong-Ho, who was present at last week’s ASEAN meeting, reportedly sought the bloc’s help and urged the region to support North Korea, adding that the situation in the Korean Peninsula was “reaching the brink of war”.

Philippine President Rodrigo R. Duterte, who chairs this year’s ASEAN meetings, told Mr. Ri during a brief exchange at the closing ceremony of this week’s ministerial talks that Pyongyang and ASEAN “would be a great dialogue partner.”

This is despite Mr. Duterte’s previous insults ahead of the regional meeting in Manila against North Korean leader Kim Jong-Un, whom the Philippine leader described as a “chubby son of a bitch” who is “playing with dangerous toys.”

Pyongyang is part of the ASEAN Regional Forum, which is an annual meeting of ASEAN and Asia-Pacific countries to discuss political and security issues.

Last week, the UN Security Council unanimously adopted tough new sanctions against North Korea for conducting its eighth nuclear test. The expanded sanction includes a ban on importation and hosting additional workers from Pyongyang.

RCBC lists LTNCDs on PDEx

RIZAL COMMERCIAL Banking Corp. (RCBC) said it listed about P2.5 billion worth of long-term negotiable certificates of deposit (LTNCDs) on the Philippine Dealing & Exchange Corp. (PDEx) Friday.

In a statement e-mailed to reporters on Friday, RCBC said its P2.502 billion worth of LTNCDs have interest rate of 3.750% per annum.

LTNCDs, like regular time deposits, offer higher interest rates but unlike time deposits, cannot be pre-terminated. Being “negotiable” means that these can be sold on the secondary market.

“The purpose of the issuance of the RCBC LTNCD is to expand the Bank’s long-term deposit base and support long-term asset growth and other general funding purposes,” the Philippine Dealing System was quoted as saying in a statement.

RCBC’s net profit hit P2.35 billion in the first half, down nearly 10% from a year earlier.

Net interest income was P8.6 billion, which accounted for 70% of its total gross income of P12.4 billion during the period.

Meanwhile, second-quarter net profit rose 67% to P1.34 billion on the back of a 16% rise in net interest income as well as a 56% increase in trading gains and a 140% rise in fee-based income.

The listed lender has a branch network of 495, with 1,511 ATMs.

RCBC shares lost 50 centavos or 0.99% to close at P50 on Friday. – Janine Marie D. Soliman

MacroAsia triples second quarter earnings

AVIATION logistics firm MacroAsia Corp. tripled its profit in the second quarter to P372 million from a year ago on the back of top line growth across its aircraft maintenance, repair, food, and ground handling businesses.

In a statement released on Friday, MacroAsia said second quarter profit rose 194% from just P126 million during the same period in 2016.

The latest earnings results brought the first-half tally to P673 million, almost triple last year’s P236 million, and already eclipsing 2016’s full-year P440-million consolidated net income.

Lufthansa Technik Philippines (LTP), where MacroAsia has a 49% stake, “has seen robust revenue growth from foreign airline clients in heavy base maintenance for wide-body aircraft such as Airbus A380s being repaired in the LTP facility in Pasay City,” the statement read.”

Top line growth was also boosted by “line maintenance activities for Philippine Airlines, as well as foreign airlines,” at the Ninoy Aquino International Airport (NAIA), and airports in Cebu, Clark and Davao.

As Lufthansa has an existing 10-year contract to repair the entire Airbus A380 fleets of Qantas Airways and has a five-year contract for the maintenance of British Airways’ A380 fleet, the listed company said that the LTP workload for its facility in NAIA is “thus assured in the medium-term.”

MacroAsia said that ground handling revenues through MASCORP, its 100%-owned ground handling subsidiary, are projected to increase by more than one-third this year, with MASCORP expanding its presence from seven airport locations in December 2016 to its current 23 airport locations.

Higher revenues were also derived from institutional accounts and more airline meal sales compared to the same period last year, as well as from its water concession business. — PPCM

Human Rights Watch flags drug-testing plan in campuses

THE Philippine government’s “plan for mandatory drug testing for all college students and applicants seriously threatens their safety and right to education,” New York-based advocacy group Human Rights Watch (HRW) said in a statement on Friday, Aug. 11.

HRW cited an order to that effect dated Aug. 2 by the Commission on Higher Education, noting this agency as being under the Office of the President. The group has been among the leading voices critical of President Rodrigo R. Duterte’s war on illegal drugs and its rising death toll.

“The college drug testing plan is a dangerous outgrowth of the Duterte administration’s abusive ‘war on drugs,’” HRW said, adding: “The order permits local governments, the police and other law enforcement agency to ‘carry out any drug-related operation within the school premises’ with the approval of school administrators. This will effectively allow the police to extend their ‘anti-drug’ operations to college and university campuses, placing students at grave risk.”

“Imposing mandatory drug testing of students when Philippine police are committing rampant summary killings of alleged drug users puts countless children in danger for failing a drug test,” said Phelim Kine, deputy Asia director at Human Rights Watch. “Education officials should be protecting students, not putting them in harm’s way through mandatory drug tests.”

The group further noted: “The higher education commission order does not require, but ‘strongly encourages’ schools of higher education to impose random mandatory drug testing of students and applicants. It follows the Department of Education’s announcement in May that it will launch random drug tests of primary, elementary, and high school students later this year.”

“Mandatory drug testing of students puts them in the crosshairs of Duterte’s abusive drug war, risking the creation of a school-to-cemetery track for students testing positive for drugs,” Mr. Kine said in the statement. “The Philippine government should educate students about the health hazards of illegal drugs — not make them targets for unlawful killings by police and their agents.”

Peso closes at nearly 11-year low on Korea tensions

THE PESO closed lower against the dollar on Friday, breaching the P51-to-the-dollar level intraday, amid escalating tensions between the United States and North Korea.

The peso closed at P50.98 against the dollar on Friday, slumping 18.5 centavos from Thursday’s finish of P50.795.

Yesterday’s close was the lowest for the peso in nearly 11 years. It ended at P51.05 to the dollar on Aug. 29, 2006.

The peso was weaker the entire day, opening the session at its peak of P50.90, later breaching the P51 level to P51.08 at its lowest intraday against the dollar.

Trading volume on Friday was $690.1 million, against $692.55 million in the previous session.

Prior to the close of yesterday’s session, Bangko Sentral ng Pilipinas (BSP) Governor Nestor A. Espenilla, Jr. said: “We’re constantly monitoring peso developments for excessive short-term volatility not consistent with underlying economic fundamentals and take appropriate action when necessary. We recognize that the market is also often self-correcting.”

Meanwhile, traders attributed the weaker peso to persistent tensions between the US and North Korea.

“The peso remained weak today due to geopolitical concerns involving the US and North Korea,” one trader said by e-mail on Friday.

Another trader said, “It’s still the tensions between North Korea and the US, and everything that’s happening there causes risk-off sentiment among traders, leading markets to resort to safe-haven assets such as the dollar, the yen and even gold.”

US President Donald J. Trump threatened North Korea with “fire and fury” after Pyongyang announced it is making plans to target Guam, suggesting a flight path over US ally Japan.

Meanwhile, one trader said corporate demand also drove the peso lower.

“There is still demand for dollar-peso from companies, but I think the market is still dominated by risk-off sentiment,” the trader said. – Janine Marie D. Soliman

PNB first-half net profit falls 37% in absence of year-earlier on-offs

PHILIPPINE NATIONAL Bank (PNB) said first-half net profit declined in the absence of one-off items from a year.

In a disclosure to the Philippine Stock Exchange on Friday, the bank said net profit was P2.7 billion, dropping 37% from a year earlier.

“The Bank’s net income for the first semester was lower than the P4.3 billion posted for the same period in 2016 that included one-time gains amounting to P2.7 billion,” the country’s fifth-largest bank by asset terms was quoted saying in a statement.

Despite this decline, the bank noted its core lending and deposit-taking businesses as well as fee-based activities continued to grow during the first six months of the year.

Net interest income rose nearly 8% to P10.3 billion in the six months to June, fueled by a 13% increase in interest income. The loan portfolio meanwhile rose 16%, led by business generated by corporate, commercial and small and medium-sized enterprise clients.

“Net interest income totaled P10.3 billion, higher by 7.9%… mainly due to expansion in the loan portfolio and income from deposits with banks which accounted for P1.2 billion and P0.6 billion increase in interest income, respectively, partly offset by the decline in interest on investment securities by P0.4 billion,” PNB said.

Its non-performing loan (NPL) ratio was at 0.25% while NPL coverage at 130% at end-June.

The consolidated risk-based capital adequacy ratio (CAR) was 15.89%.

Non-interest income stood at P3.4 billion year-on-year driven by one-off revenue. These include net gains from major disposals of foreclosed assets, the sale of shares of stock of a subsidiary and the collection of non-performing assets.

Boosted by cross-selling, net service fees and commission income expanded 12% year-on-year.

“Meanwhile, treasury-related income decreased substantially owing to muted trading opportunities as investors continue to stay on the sidelines amid further global monetary tightening and interest rate developments in the international markets,” PNB said.

The lender’s operating expenses increased by 6% year-on-year on the back of “prudent spending despite aggressive business growth.” This excluded provisions for impairment and credit losses.

Net consolidated resources hit P824 billion in the six months ending June, up 16% from a year earlier.

PNB’s deposits grew 17% in the first half of the year amid its “focus on generating low-cost funds and replacing matured high-cost Tier 2 Notes with Long-term Negotiable Certificates of Deposit (LTNCD.)”

Meanwhile, net profit in the three months to June fell 18% to P1.4 billion.

At the end of June, it had 685 branches and 1,143 automated teller machines in the Philippines. It also has 70 overseas bank branches, representative offices, remittance centers and subsidiaries locared in Asia, Europe, Middle East and North America. – Janine Marie D. Soliman