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Bad loan ratio soars to near two-year high

PHILIPPINE STAR/ MICHAEL VARCAS

By Luisa Maria Jacinta C. Jocson, Reporter

THE BANKING INDUSTRY’S nonperforming loan (NPL) ratio soared to a near two-year high in May, data from the Bangko Sentral ng Pilipinas (BSP) showed.

The Philippine banking industry’s gross NPL ratio rose to 3.57% in May from 3.45% in April and 3.46% a year ago.

This matched the 3.57% ratio in July 2022. It was also the highest in 23 months or since 3.6% in June 2022.

Data from the BSP showed that soured loans rose by 3.1% to P495.67 billion in May from P480.65 billion a month earlier. Year on year, it jumped by 13.7% from P436.12 billion.

Loans are considered nonperforming once they remain unpaid for at least 90 days after the due date. These are deemed as risk assets since borrowers are unlikely to pay.

The loan portfolio of Philippine banks dipped by 0.3% to P13.89 trillion as of end-May from P13.94 trillion at end-April. However, it increased by 9.3% from P12.6 trillion a year ago.

Past due loans dropped 1.6% to P608.07 billion in May from P618.04 billion a month earlier but rose by 15.7% from P525.51 billion in the previous year.

This brought the past due ratio to 4.38%, lower than 4.43% in April but higher than 4.17% a year ago.

On the other hand, restructured loans stood at P295.89 billion, up by 1.9% from P290.37 billion in April but 4.6% lower than P310.3 billion a year ago.

These borrowings accounted for 2.13% of the industry’s total loan portfolio, higher than 2.08% a month ago but lower than the 2.46% in May 2023.

Banks’ loan loss reserves inched up by 0.7% to P474.88 billion in May from P471.35 billion in April and rose by 6.9% from P444.03 billion a year ago.

This brought the loan loss reserve ratio to 3.42%, up from 3.38% last month but lower than 3.52% a year ago.

Lenders’ NPL coverage ratio, which gauges the allowance for potential losses due to bad loans, slipped to 95.81% from 98.07% in April and 101.81% in May 2023.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the higher NPL ratio was due to elevated interest rates.

The Monetary Board has kept its benchmark rate at 6.5%, the highest in over 17 years, since October 2023.

Mr. Ricafort also cited the weaker peso, which sank to the P58-per-dollar level in May. The local currency has been inching closer to its record low of P59 against the dollar in recent weeks.

“For the coming months, possible Fed and local rate cuts would help ease borrowing costs and spur greater demand for loans and other business activities, which would eventually help ease the NPL ratio going forward,” Mr. Ricafort said.

BSP Governor Eli M. Remolona, Jr. has said that the central bank could begin its policy easing by August. He has also signaled rate cuts of up to 50 basis points for the entire year.

The Monetary Board is set to meet on Aug. 15, its only meeting in the third quarter. The last two meetings this year are scheduled for Oct. 17 and Dec. 19.

US Federal Reserve officials at their last meeting said the US economy appeared to be slowing and that “price pressures were diminishing,” but still counseled a wait-and-see approach before committing to interest rate cuts, according to minutes of the June 11-12 session, Reuters reported.

Fed officials earlier signaled cutting rates as late as December and priced in just one cut from three previously.

PHL unlikely to breach upper end of growth goal

People go shopping in Divisoria, Manila. — PHILIPPINE STAR/RYAN BALDEMOR

THE PHILIPPINES may have difficulty achieving the upper end of the government’s 6-7% gross domestic product (GDP) growth target this year amid expectations of weaker consumption and investment, Fitch Solutions’ unit BMI said.

“The economy will find it hard to breach the upper half of the 6-7% growth target which the government has set. Headwinds stemming from restrictive financial conditions alongside a weaker external sector will keep a lid on growth,” it said in a report.

BMI forecasts GDP to expand by 6.2% this year, within the government’s target.

In the first quarter, the Philippines posted 5.7% GDP growth, faster than the 5.5% a quarter ago.

However, BMI noted that while first-quarter GDP showed an annual increase, this is still “by no means an accurate representation of the economy’s health.”

“A more detailed breakdown suggests that underlying domestic demand has softened even though the external sector showed some tentative signs of rebound. That said, we think there are still reasons to be optimistic even when downside risks dominate,” it said.

Household spending, which typically accounts for three-fourths of GDP, rose by 4.6% in the first quarter. This was its slowest since the 4.8% drop in the first quarter of 2021.

“Risk to our growth outlook hinges largely on the recovery in private consumption. In our current forecast, we have taken April’s robust import growth figures to indicate early signs of a rebound in household spending.”

“But if May and June data disappoint, this anticipated recovery in private consumption will not materialize,” it added.

Meanwhile, BMI said sluggish investments will also weigh on the Philippine growth outlook.

“Investment activity will stay muted against the backdrop of high interest rates. Indeed, the contribution of fixed capital to growth has been very weak, most recently coming in at just 0.5 percentage point (pp).”

The Bangko Sentral ng Pilipinas (BSP) has kept its key rate at a 17-year high of 6.5% since October 2023.

While BSP Governor Eli M. Remolona, Jr. has hinted at the possibility of policy easing as early as August, BMI said this is “improbable” at the moment due to the peso’s weakness and expectations of a delay in the US Federal Reserve’s easing.

The peso has been trading at the P58-per-dollar range since May, slowly inching to the record low P59 level.

BMI expects the central bank to only start cutting rates by October and in step with the Fed.

“However, the lagged impact of policy easing means that its impact will likely only be felt in 2025. Indeed, business sentiment towards the economy has notably diminished,” it said.

BMI said the external sector would also provide “less support” in the next few quarters as the rebound in exports will be difficult to sustain.

“Several key trading partners are due for an economic slowdown, after a strong showing in the first quarter. For instance, we believe that growth in mainland China has reached its peak and will diminish in the following quarters,” BMI said.

“The strong start to the year for the US economy is also expected to succumb to the pressures of tight monetary policy and a less supportive fiscal backdrop. Japan, Hong Kong, China and Singapore are no exceptions. Together, they account for about 73% of total Philippine merchandise exports.” — Luisa Maria Jacinta C. Jocson

Philippine reliance on coal deepens amid slow transition to green energy

Various civil society and environment advocate groups are pushing for more affordable renewable energy sources. — PHILIPPINE STAR/ MIGUEL DE GUZMAN

By Sheldeen Joy Talavera, Reporter

THE PHILIPPINES continues to depend on coal-fired power as it struggles to implement policies to boost renewable energy capacity, analysts said.

Data from energy think tank Ember showed the Philippines is now the most coal-reliant country in Southeast Asia, surpassing Indonesia and China.

“This is a consequence of the country’s inability to transition to energy renewables and its inability to predict its long-term social effects,” Leonardo A. Lanzona, Jr., an economics professor at the Ateneo de Manila University, said in a Facebook Messenger chat.

“While we may reduce the costs of production, the looming environmental costs brought about by this policy will be greater than the benefits,” he added.

Ember data showed the share of electricity generated from coal in the Philippines increased by 2.9% to 61.9% in 2023 from 59.1% in 2022.

“As for the Philippines, coal generation grew much higher than the rise in electricity demand (9.7% vs. 4.6%). Its absolute coal generation ranks 17th in the world, but it is placed eighth in terms of generation shares,” Ember said in a statement on Monday.

Mr. Lanzona said the Philippines’ coal dependence has not significantly increased but surpassed other countries that had limited coal usage.

In 2023, 62% of power generation was supplied by coal-fired power plants at 69,472 gigawatt-hours, based on the data from the Department of Energy (DoE).

DoE data showed the country has over 6,300 megawatts (MW) of dependable coal capacity aged 10 years or younger. These plants can be relied on to operate for at least another 30 years.

Mr. Lanzona said the Philippines’ transition to green energy has been hampered by the lack of government programs.

“The lack of skills and manpower to develop full-scale renewable energy programs is one of the main constraints [in the green energy transition],” he said.

The Philippines already has a plan to accelerate the voluntary retirement of up to 900 MW of existing coal-fired power plant generation capacity by 2027 under its Accelerating Coal Transition (ACT) investment plan.

In 2020, the DoE issued a moratorium on the development of new coal-fired power plants to reduce the Philippines’ dependence on coal.

However, Gerry C. Arances, executive director of think tank Center for Energy, Ecology and Development, said the increase in renewables in the power mix is overshadowed by the fact that coal power plants have not been shuttered.

“The coal moratorium in 2020 came with the possibility of an urgent shift to renewable energy, but the Philippines confronted the threat of the aggressive push for natural gas and liquefied natural gas (LNG) crowding out the entry of renewables instead,” he said in a Viber message.

The share of renewable energy (RE) in the country’s power generation mix stands at 22%. The government is aiming to increase RE’s share to 35% by 2030 and 50% by 2050.

Ember said the Philippines and Indonesia have seen limited growth in RE generation, as their wind and solar potential “remains almost entirely untapped.”

Indonesia and the Philippines also have a smaller wind and solar share in their electricity mix than most other countries in Southeast Asia.

“Wind and solar can be deployed faster than any other renewable electricity source and are also the cheapest source of electricity. Accelerating their deployment would allow Indonesia and the Philippines to meet their growing electricity demand with renewables and to reduce their reliance on coal,” Ember said.

SUSTAINABLE ENERGY
Robert Dan J. Roces, chief economist at Security Bank Corp., said the declining costs of renewable energy make it a more sustainable long-term option.

“However, the Philippines remains bogged down by existing coal infrastructure and policy hurdles that don’t incentivize renewables just yet,” he said in a Viber message. “Compared with regional neighbors that are aggressively scaling up solar, wind and efficiency measures, the Philippines is behind.”

Mr. Roces said the Philippine government should revamp regulations, streamline permitting processes and modernize the grid.

Calixto V. Chikiamco, president of Foundation for Economic Freedom, said RE challenges include intermittency, technologies that require significant portions of land such as solar power, and those that are site-specific and need long transmission lines to connect to the grid such as wind energy.

Jose M. Layug, Jr., president of the Developers of Renewable Energy for Advancement, Inc., also cited the difficulty in securing permits and delays in regulatory approvals for power contracts and transmission projects.

“Now, under President [Ferdinand R. Marcos, Jr.], [Energy] Secretary [Raphael P.M. Lotilla] and [Energy Regulatory Commission] Chair [Monalisa C. Dimalanta], we have declared the correct signals to the private sector and investors: the Philippines wants cheaper, sustainable and more efficient renewables,” he said in a Viber message.

Investments in RE projects increased after the Philippine government allowed full foreign ownership in the sector starting November 2022.

Foreign nationals and foreign-owned entities are now allowed to explore, develop and use RE resources such as solar, wind, biomass, ocean or tidal energy in the Philippines. Foreign ownership of RE projects was previously limited to 40%.

Allied Care Experts (ACE) Medical Center-Legazpi, Inc. announces Annual Stockholders’ Meeting on Aug. 1 via Zoom

 

 


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Divine Grace Medical Center partners with Bureau of Fire Protection – General Trias City Fire Station to extend healthcare access for first responders

Divine Grace Medical Center (DGMC), a Mount Grace Hospital, proudly announces its recent partnership with the  Bureau of Fire Protection (BFP) – General Trias City Fire Station. This collaboration is a significant step towards ensuring access to a wide range of medical services, quality healthcare, and value-for-money services for BFP members actively serving in their line of duty, as well as extending the same privilege to their dependents.

The partnership agreement between DGMC and BFP aims to alleviate the burden of healthcare accessibility for the brave men and women of the Bureau of Fire Protection and their families. By providing them with seamless access to medical care, DGMC and BFP underscore the importance of proactive healthcare management for the local first responders.

Dr. Leonard Lao, President of DGMC, emphasized the importance of this partnership, stating, “We have extended special offers on medical services for the agency because we believe that their health is of utmost importance, especially in their line of work.”

This partnership serves as a testament to DGMC’s dedication to serving the community and supporting those who serve and protect it. By joining forces with the Bureau of Fire Protection, DGMC reaffirms its mission to be a pillar of health and wellness in General Trias and beyond.

Divine Grace Medical Center is a secondary 75-bed multi-specialty hospital in General Trias, Cavite, with a vision to be a leader in healthcare within their community. Through initiatives like this partnership with the Bureau of Fire Protection, DGMC continues to strive towards achieving this vision while making a positive impact on the lives of those they serve. For more information: www.divinegracemedicalcenter.com.

 


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8990 Holdings, Inc. to conduct annual meeting of stockholders online on July 29

 

 


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Pinoy comedians showcase their talents

VICE GANDA stands in the center of the comic contestants of LOL: Last One Laughing Philippines.

TEN Filipino comedic powerhouses unite in LOL: Last One Laughing Philippines, a series which premiered on July 4 on Prime Video. LOL is a six-part competition where the contestants face off in a showdown, with the goal to make others laugh without cracking up themselves.

Filmed over six hours, the 10 participants test their comedic prowess and self-control, every moment captured by multiple cameras to accurately determine the winner.

The show gives viewers a front-row seat to the clash of humor and endurance of the participating comics — Victor Anastacio, Jayson Gainza, Pepe Herrera, Chad Kinis, Empoy Marquez, Kim Molina, Jerald Napoles, Negi, Tuesday Vargas, and Rufa Mae Quinto. The show’s host is box office star and comedian Vice Ganda.

Though most of the contestants have been in show business for decades, one stands out as the biggest threat to the rest.

Pinagtulungan nila ako kaya lagi akong galit (They ganged up on me which is why I was always mad),” said Ms. Quinto at a press conference at Okada Manila in Parañaque City on June 28.

As a Filipino actress and comedian with naturally exaggerated mannerisms and tone of voice, she treated the show as a chance to enjoy showing off her skills with younger comedians.

For Ms. Molina — the youngest in the cast but with a background in singing, theater, and acting — being with comedians she admired was challenging.

Tinitingala ko kasi lahat kasi ako ang pinaka-bata. Idol ko silang lahat (I look up to all of them since I’m the youngest. They’re all my idols),” she said at the press conference.

She said that at one point, she simply chose to cry so that she wouldn’t laugh at the others’ hilarious antics. Another challenge was that her longtime onscreen and real-life partner, Jerald Napoles, was also in the cast.

Mr. Napoles explained that the two of them did not allow their relationship to get in the way as they just focused on the competition.

He did mention the effect of creating the series in the age of cancel culture. “People are more opinionated now and they can choose and filter what they like. We’re hoping that, because of social media, people are more aware of different types of comedy. We as comedians get to enjoy the variety,” he said.

The LOL: Last One Laughing format is available in 13 countries on Prime Video, with the Italy, France, and Germany versions being the most watched in their respective territories. There are also versions of the show in Mexico, Australia, India, Spain, Canada, The Netherlands, Colombia, Argentina, Brazil, and Sweden.

Alongside the newly released Filipino adaptation, LOL: Last One Laughing Thailand and LOL: Last One Laughing Indonesia also premiered this July.

“Filipinos can expect local touches in their edition, such as setting it at bahay ni lola (grandmother’s house), with a set built from the ground-up and backed by months of planning and pre-production,” said Darin Darakananda, head of central scripted series and movies for Amazon’s international originals.

However, the mechanics across all franchises are the same — any laugh, smile, or even lifting of the corners of lips will warrant a warning. The second time an individual receives a warning equals their elimination.

The cast was handpicked carefully to ensure an interesting mix of diverse professional backgrounds, from comedy bar stalwarts to stand-up performers to funny theater and onscreen actors.

Randolph Longjas, director of LOL: Last One Laughing Philippines, added that he had watched other versions of the franchise prior to filming theirs.

“I’m now super proud with our brand of comedy that can match and even outmatch the others. Vice Ganda is also the only host of any LOL franchise who is from the LGBTQ+ (lesbian, gay, bisexual, trans, queer plus) community,” he said.

Mr. Ganda explained that, as host, it was his privilege to sit back and enjoy the “six-hour free show” that the 10 contestants provided — but he also had to watch them to make sure no one laughed.

Noong una natatawa ako, pero mamaya napapahanga na rin (At first I felt the laughter, but later it turned into admiration). In comedy, you can see the soul of the person,” he said.

Napapangiti nito ang mukha at napapasaya nito ang puso (Comedy lights up the face and it also brings joy to the heart).”

LOL: Last One Laughing Philippines officially premiered its first two episodes on Prime Video on July 4, with two more to be released each subsequent week. Prime Video is available in the Philippines for P149 per month. — Brontë H. Lacsamana

Major energy players eyeing Meralco’s 600-MW supply contract

MERALCO.COM.PH

By Sheldeen Joy Talavera, Reporter

THE SUBSIDIARIES of First Gen Corp., San Miguel Global Power Holdings Corp. (SMGP), and Aboitiz Power Corp. (AboitizPower) have joined the firms interested in bidding for Manila Electric Co.’s (Meralco) 600-megawatt (MW) power supply contract.

“This CSP (competitive selection process) for Meralco’s baseload requirement gained the interest of the country’s major energy players, which reflects the private sector’s continuing efforts to ensure sufficient and cost-competitive supply for consumers,” Lawrence S. Fernandez, chairman of Meralco’s bids and awards committee for power supply agreements, said in a Viber message to reporters on Thursday. 

The government requires distribution utilities to select the cheapest electricity supply through a competitive bid.

“We look forward to the bid submissions of these prospective bidders next month,” Mr. Fernandez said.

Eight companies expressed interest and participated in the pre-bid conference for Meralco’s 600-MW baseload supply on Thursday.

First Gas Power Corp. and First NatGas Power Corp. are subsidiaries of Lopez-led First Gen. 

Mariveles Power Generation Corp. and Masinloc Power Co. Ltd. are subsidiaries of SMGP, the power arm of conglomerate San Miguel Corp.

GNPower Dinginin Ltd. Co. operates under the private limited partnership of Aboitiz Power Corp.’s Therma Power, Inc., AC Energy & Infrastructure Corp., and Power Partners Ltd. Co.

Other companies whose representatives attended the pre-bid conference include Therma Luzon, Inc., a subsidiary of AboitizPower; Southwest Luzon Power Generation Corp., a subsidiary of Semirara Mining and Power Corp.; and Quezon Power (Philippines) Limited Co.

Last month, Meralco initiated the bidding process for a 15-year power supply agreement to fulfill its requirements starting Aug. 26, 2025.

As per last year’s Department of Energy advisory, power suppliers with natural gas-fired plants are urged to join the bidding and prioritize indigenous natural gas.

The deadline for bids is Aug. 2.

METER THEFT
Meralco also reported on Thursday a 63% increase in stolen electric meters, totaling 1,131 incidents from January to June compared to the same period last year. 

Over the past five years, the power distributor has documented a total of 4,591 stolen electric meters.

“We are reminding the public that these meters are the property of Meralco, and we do not charge our customers for its use,” Meralco Vice-President and Head of Corporate Communications Joe R. Zaldarriaga said.

“Stealing, reselling, and buying these meters are illegal activities punishable under the law and anyone caught in possession of these stolen equipment will be prosecuted and penalized accordingly,” he added.

Meralco said that it employs unique identifiers on all its meters so that these can be traced and identified as property of the company.

“We urge the public to report any suspicious activities or stolen meters to Meralco or the authorities to help us curb this illegal practice and ensure the safety and integrity of electric service,” Mr. Zaldarriaga said.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls.

Three leading women each shine in three concerts

TRIPLE THREATS (L-R) Carla Guevara Laforteza, Sheila Valderama Martinez, and Tanya Manalang Atadero — TRIPPLE THREATS/KIKO CABUENA

A PERFORMER who can sing, dance, and act exceptionally well is known as a triple threat. This year, three women in Philippine musical theater who are considered as such are the featured performers in the Cultural Center of the Philippines’ (CCP) aptly titled concert series, Triple Threats.

The concert series performances will be held at the CCP’s Tanghalang Ignacio Gimenez (Black Box Theater) from July to December.

Each solo concert will feature songs personally selected by each of the artists. This puts the spotlight on these multifaceted women, who get to tell a unique narrative through their selection of music.

Since the Triple Threats series kicked off in 2013, many Filipino theater stalwarts have graced the stage and put on concept concerts. Previous years saw the likes of Menchu Lauchengo-Yulo, Audie Gemora, Nonie Buencamino, Sheila Francisco, Michael Williams, and Bituin Escalante show off their talents.

“This series started with the goal to showcase performers who can sing, act, and dance. It’s great to see that it’s now on its 11th year, with so many who have this complete package,” said Ariel Yonzon, associate artistic director of CCP’s production and exhibition department, at a June 2 press conference.

This year’s lineup features musical theater performers Carla Guevara Laforteza, Shiela Valderrama Martinez, and Tanya Manalang Atadero.

CARLA GUEVARA LAFORTEZA
Kicking off this year’s series on July 25 at 7:30 p.m. is Carla Guevara-Laforteza with a show titled A la Carlotta.

One of the strongest and most fearless stage performers in the Philippines today, Ms. Guevara-Laforteza has graced the international musical theater scene with notable roles like Kim and Gigi in Miss Saigon at the Theatre Royal Dreary Lane in London (1995-1997), and the Club singer and Flo Manero for the Asian tour of Saturday Night Fever (2015). She is also currently touring Asia as an official vocalist for Disney in Concert (2023-2025).

Among her notable roles in local theater include Joy in Ang Huling El Bimbo, for which she received the 2019 LEAF Award for Most Outstanding Actress in a Musical, and Kapitana Mary Jane in Rak of Aegis, for which she was awarded the GEM Award for Best Featured Artist. She is currently appearing as Edith and Rose in the new Ben&Ben musical, One More Chance.

Ms. Guevara-Laforteza is celebrating her 30th year in the industry, which led her to make this concert different from anything she’s done before. “I already did a concert of all the solos I’ve ever done. This time, I’ll do songs I want to sing, songs that I bop my head to from movies and pop culture,” she said.

“This is really a repertoire you won’t expect me to do. It’s called A la Carlotta because it’s according to me. It’s what I want to do,” she added.

Songs to expect include “He Opens a Window” from Joseph the Dreamer and “Spain” by Al Jarreau. The show will be helmed by musical director Gerard Salonga and Paolo Valenciano.

SHIELA VALDERRAMA MARTINEZ
The second concert in the Triple Threats series features Shiela Valderrama-Martinez.

Directed by Menchu Lauchengco-Yulo, the show on Oct. 17 includes songs from Disney and Broadway musicals that Ms. Valderrama-Martinez does not usually get to sing.

Her 30-year career has earned her LEAF Awards for Best Actress in a Musical, Awit Awards for Best New Female Recording Artist, and Aliw Awards for Excellence in Dramatic Performance. Among her notable roles are Lily Dela Rosa in Binondo: A Tsinoy Musical, Katherine Lyons in the critically acclaimed musical Dani Girl, Kapitana Mary Jane in Rak of Aegis, and Fosca in Stephen Sondheim’s Passion.

More recently, Ms. Valderrama-Martinez performed at The Dream is a Wish Disney Orchestra Concert in Genting, Malaysia. Coming from this, the goal for her show is to chart her journey as a performer.

“I like to think our entire body of work has led us to getting this opportunity. We all have our own flavor as performers, and I hope you all come to our concerts to experience that,” she said.

Songs to expect include “When You Wish Upon A Star” from the Disney animated film Pinocchio and “Quiet” from Matilda the Musical.

TANYA MANALANG ATADERO
Closing out the series on Dec. 12 is Tanya Manalang-Atadero.

Despite being the youngest performer in this year’s lineup, she is one of the most accomplished actresses on the musical theater stage. Her skills and talent have brought her the world over, from New Manila, Quezon City, to the West End of London. She has played roles such as Kim in the West End revival of Miss Saigon, Liesl Von Trapp in the classic musical The Sound of Music, Carla in the Atlantis Production of In The Heights, Stacy King in All Out of Love, and Aileen in PETA Theater’s 5th season of Rak of Aegis.

For the latter two roles, she garnered the Aliw Award and GEMS Award for Best Actress in Musical. She is also currently part of the touring singing group The Jet Theaters, performing in events across Asia.

Ms. Manalang-Atadero’s show, set for the end of the year, is still in development.

“It will be a story of my journey. I will definitely sing songs from musicals I did and songs you also won’t expect,” she said. “There will be OPM for sure.”

The three concerts will be held at the Tanghalang Ignacio Gimenez at the CCP Complex in Pasay City. Standard tickets cost P1,000 while VIP tickets cost P1,500, both of which are available via TicketWorld and the CCP Box Office. — Brontë H. Lacsamana

Cybercrime center clears GCash of data breach claims

BW FILE PHOTO

By Aubrey Rose A. Inosante

THE CYBERCRIME Investigation and Coordinating Center (CICC) on Thursday said the alleged compromised know-your-customer data files, reportedly linked to GCash, were found not to conform with the e-wallet’s naming protocols.

“These files are not part of their naming protocols,” CICC Undersecretary Alexander K. Ramos told BusinessWorld, addressing claims made by the cyber advocacy group Deep Web Konek.

“The only thing that’s theirs is GSave, which allows the user to choose a bank or a depository that is maintained by the banks,” he added.

Deep Web Konek said the breach involved over 35,000 items and 30 gigabytes of data, purportedly including payslips, employee compensation certifications, GSave account terms, and debit cards.

“Normally, the files… these are the parts of the assessment and investigation. That’s where you’ll see the origin of the file. The time and dates, when it was created, when it was last accessed, who authored it,” he said.

“But apparently, there’s none. We have nowhere to start with,” he added.

Mr. Ramos noted efforts to reach out to the group for clarifications.

“There’s really no story here but one nice thing is that (GCash) is responding. Unlike the other year, 2020, when they were here. Now, they respond quickly,” he said.

In a statement on June 27, GCash said: “Based on our initial findings, there are no indications of a data breach in our systems and this has no impact on customer funds and their accounts remain safe and secure.”

FINANCIAL SECTOR
Stakeholders in the financial sector should seek collaboration with various industries to deter rising cyberattacks and earn digital trust, according industry executives.

“It’s challenging but we need to work together. Either with the help of the telecommunications companies, [and] the regulatory body,” Union Bank of the Philippines Chief Information Officer (CIO) Dennis Omila said at KPMG’s Innovation Summit 2024 on Thursday.

He added that competition should be set aside to collaborate with other players, as users conduct transactions across different platforms.

Similarly, RCBC CIO Carlos Tengkiat emphasized a unique collaboration among all industries to develop interoperable technologies that adhere to standards.

“If you create something that is proprietary, it’s not a sustainable approach,” he said, highlighting that the sector’s technologies include legacy systems alongside new hybrid cloud systems.

Bangko Sentral ng Pilipinas (BSP) Managing Director and CIO Eugene Teves cited guidelines on information technology risk management for banks, including Circulars 1048 and 1169, which focus on customer protection.

“As we try to move to a more digital mode of banking, we also see a lot of complaints and concerns that have arisen and, in this case, the BSP takes them seriously,” Mr. Teves said.

Tim Burton’s Beetlejuice Beetlejuice to open Venice film festival

ROME — Beetlejuice Beetlejuice, directed by Tim Burton, will open this year’s Venice Film Festival, bringing with it a slew of Hollywood stars who were largely absent from the Lido red carpet in 2023 because of an actors’ strike.

The long-awaited sequel to Mr. Burton’s original 1988 comedy horror classic will be screened out of competition on Aug. 28, giving the 81st edition of the festival a high-profile, glitzy start.

The film sees Michael Keaton return to the lead role, and also stars Winona Ryder, Catherine O’Hara, Monica Bellucci, Willem Dafoe, and Jenna Ortega, who last teamed up with Mr. Burton on the hit Netflix show Wednesday.

“Venice is honored and proud to host the world premiere of a work that features a surprising swing of creative imagination and driving hallucinatory rhythm,” said festival director Alberto Barbera.

The Venice Film Festival marks the start of the awards season and regularly throws up big favorites for the Oscars.

However, its 2023 edition was overshadowed by an actors’ and writers’ strike in Hollywood that kept many big names away and forced the organizers to ditch their original choice for the prestigious opening slot Challengers starring Zendaya.

The rest of the 2024 line-up is due to be unveiled on July 23, with widespread speculation that Todd Phillips’ Joker sequel, starring Joaquin Phoenix and Lady Gaga, will feature along with the action thriller Wolfs, which brings together Brad Pitt and George Clooney.

The festival held on the lagoon city’s Lido island, will run from Aug. 28 to Sept. 7, with France’s Isabelle Huppert heading the main competition jury.

The movie is scheduled to open in Philippine theaters on Sept. 4. — Reuters

Fed easing to spur peso rebound — BMI

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THE US Federal Reserve’s expected policy easing towards the end of the year will help support the peso’s recovery against the dollar in the near term, Fitch Solutions’ unit BMI said.

“The Philippine peso has weakened by nearly 6.2% year-to-date, emerging as one of the weakest currencies in the region. Constant repricing of interest rate expectations in the US has led to much volatility in many emerging market (EM) currencies, and the peso is no exception,” it said in a report dated July 3.

“We think that the currency will reverse its losses in the fourth quarter once the US Federal Reserve begins its monetary loosening cycle in September. For now, we are holding on to our forecast for the peso to reach P56.50 per dollar by yearend, implying that it will strengthen by about 4% from the current spot rate of P58.70 a dollar. That said, our forecast hinges on the accuracy of our Fed projection,” it added.

The Development Budget Coordination Committee (DBCC) expects the peso to range from P56-P58 for this year.

On Thursday, the peso closed at P58.58 versus the dollar, rising by 14.5 centavos from the previous day’s finish.

Year to date, however, the peso is still down by P3.21 from its end-2023 close of P55.37.

The peso has been trading at the P58 range since late May as the Fed has continued to signal a “higher for longer” policy stance due to sticky inflation in the world’s largest economy, which has propped up the dollar against major and EM currencies.

The Bangko Sentral ng Pilipinas’ (BSP) comments on possibly starting its own easing cycle before the Fed have also contributed to the peso’s weakness against the greenback.

BMI said it expects the peso to undergo “additional volatility” in the short term as the timing of the Fed’s first cut remains uncertain.

“Indeed, market participants have grown increasingly pessimistic about the US loosening cycle, with markets pricing in fewer cuts by the end of 2024 compared to the 100-150 basis points (bps) expected at the start of the year,” it said.

“While it is widely expected that the Fed’s next move will be a cut, markets are uncertain about the timing and extent of policy easing. We think that this will only materialize in September, culminating in a total of 50 bps by yearend. Until then, constant fluctuations in market rate expectations will inject another layer of unpredictability into dollar strength, indirectly affecting the peso,” BMI added.

Fed officials at their last meeting acknowledged the US economy appeared to be slowing and that “price pressures were diminishing,” but still counseled a wait-and-see approach before committing to interest rate cuts, according to minutes of the June 11-12 session, Reuters reported.

The minutes, which were released on Wednesday, noted in particular a weak May reading in the consumer price index as one among “a number of developments in the product and labor markets” that supported a view that inflation was falling.

But in voting to keep the policy rate steady in the 5.25%-5.5% range where it has now been for a year, “participants noted that progress in reducing inflation had been slower this year than they had expected last December,” the minutes said, with “some participants” emphasizing the need for patience before cutting rates, and “several” citing the possible need to raise rates further if inflation resurged.

Investors broadly expect a quarter-percentage-point rate cut at the Fed’s Sept. 17-18 meeting and another one in December. The US central bank will hold its next policy meeting on July 30-31, when it is expected to leave its benchmark interest rate unchanged.

Meanwhile, the BSP’s recent dovish signals will also contribute to continued peso volatility, BMI added.

BSP Governor Eli M. Remolona, Jr. has said the Monetary Board is “on track” and “somewhat more likely than before” to slash rates at its Aug. 15 policy meeting as he expects inflation to further ease this semester with the implementation of lower tariffs on rice.

The BSP could cut rates by 25 bps in the third quarter and by another 25 bps in the fourth quarter, he added.

The Monetary Board’s Aug. 15 review is its only meeting in the third quarter. Meanwhile, its last two reviews for the year will be held in the fourth quarter and are scheduled on Oct. 17 and Dec. 19.

The last time the BSP cut borrowing costs was in November 2020, when it brought down its policy rate by 25 bps to a record low of 2% to help boost the economy at the height of the coronavirus pandemic.

“The BSP stands in contrast to its peers in Asia, which remain hawkish as regional currencies have declined this year. Even so, we do not think that this will actually happen. A preemptive move to cut ahead of the Fed will exacerbate weakness in the already battered currency. Instead, we think that the bank will only adjust monetary settings in concert with the Fed, with the first cut only materializing in October. If we are right, we could very well see the peso regain some of its footing against the greenback as market expectations reverse course,” BMI said.

“Risks to our currency forecast hinge on the timing of cuts by the BSP. If the bank were to go ahead with monetary loosening in August, this would exacerbate weakness in the peso, potentially breaching the P59 level…,” it added.

It said the peso’s movements against the dollar in the short term will also depend on the aggressiveness of the BSP’s presence in the foreign exchange market. 

Mr. Remolona has said the central bank intervenes occasionally to prevent sharp swings in the currency and keep markets orderly.

“The BSP drew the line at the P59 level in 2022, and we think that policy makers will continue to intervene to prevent the peso from depreciating past this level,” BMI said.

Meanwhile, for 2025, expectations of further monetary easing in the US will help the peso “regain ground,” BMI said.

“For 2025, we are shifting our forecast to pencil in a slight strengthening of the peso on the back of 200 bps worth of cuts by the Fed. This is a slight departure from our previous projection for it to weaken. Even so, the bigger picture is that weak fundamentals will keep a lid on any appreciatory pressures on the currency,” it added.

It forecasts the peso to settle at P55 per dollar at end-2025. The DBCC sees the currency ranging from P55-P58 next year.

Risks to their currency outlook include the Philippines’ large current account deficit and elevated inflation, it said.

“The Philippines is likely to experience higher inflation rates than the United States, exerting downward pressure on the peso. Generally, prices in EMs like the Philippines rise more quickly than in developed economies… Persistent inflation in the Philippines means that a gradual depreciation of the peso might be necessary to keep the country’s competitive edge in the international market,” BMI said. — L.M.J.C. Jocson