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Red Sea crisis could fan Asia’s inflation anew, delay rate cuts

A cargo ship is seen off the coast of Djibouti. — LUKE DRAY/GETTY IMAGES VIA BLOOMBERG

ASIA could see slower economic growth and a resurgence of inflation as escalating violence in the Red Sea snarls shipping between the region and their trade partners in the US and Europe, according to the Economist Intelligence Unit (EIU).

The supply chain disruptions could cut as much as 0.5 percentage point (ppt) off Asia’s economic growth this year and add up to 0.4 ppt to the inflation rate, the EIU said in a report.

“Given that Asian exports were already hit last year by weak Western demand, the recent attacks will weigh further on various export-dependent economies, particularly in Southeast Asia, where container trade has nearly collapsed,” the report read, citing Indonesia, Thailand and Malaysia as among those most vulnerable.

Most of the region will likewise be hit indirectly through the spike in shipping costs, especially those that rely on food imports such as the Pacific Island countries, New Zealand, India and Pakistan.

“Higher inflation could leave central banks in countries such as the Philippines, Australia and India in a more difficult situation in terms of finding an opportunity to begin monetary easing,” the EIU said.

Protracted shipping disruptions could also push manufacturers to seek options closer to their end-user markets, rather than tapping the “stretched” supply chains in Asia, it said.

Based on EIU estimates, shipments from northwest Europe now take 56 days to reach Malaysia and Singapore from 32 days before the Houthi attacks began in November. For China, Hong Kong and Taiwan, it lengthened to 55 days from 42 days. — Bloomberg

ProCredit secures US$4.1 million in pre-seed funding to propel tech-enabled SME lending

ProCredit Team (from left to right): Ged Cotoco, Ana Dipasupil, Adnan Agha, Dwaipayan Mitra, and Kim Ordas

ProCredit, a Philippines-based small and medium enterprise (SME) lender, closed a US$4.1-million pre-seed round, led by Integra Partners, with participation from the Menardo Jimenez Family Office, M Venture Partners (MVP), Cento Ventures, Gobi Partners (Gobi-Core Philippine Fund), and several local angel investors.

ProCredit is a tech-enabled SME lender started by a founding team with over 50 years of combined emerging markets and SME-lending experience, having held senior lending roles at Citigroup, Standard Chartered, ANZ, and the Asian Development Bank. Leveraging this deep domain expertise, ProCredit aims to become one of the largest SME lenders in the Philippines, employing credit-first client engagements, a rules-based underwriting and portfolio management architecture, and flexible product offerings incorporating risk-based pricing, all powered by a proprietary technology back-end to significantly reduce operating costs and expenses, while drastically improving customer experience.

ProCredit will expand its loan book through organic and inorganic growth, and raise additional capital. The fintech startup is also considering expansion into the banking sector, given the founders’ extensive experience managing lending operations in regulated banks across Asia, Africa, and the United States. This would allow ProCredit to offer a fuller suite of lending solutions to its mid-market SME customers.

“We are thrilled to add ProCredit to our portfolio. We rarely see such an experienced and thoughtful founding team positioned against such a large, underserved market opportunity. ProCredit will play a significant role in providing improved access to credit to the economy’s most important sector,” said Chris Kaptein, managing partner at Integra Partners.

“We are confident that our investment in ProCredit will further Integra’s mission of investing where profits and purpose converge for a win-win for all parties,” Mr. Kaptein added.

The Menardo Jimenez Family office also participated in the round. The family office invests across different sectors of the Philippines’ economy, focusing on real estate, financial services, and agriculture.

“We are very familiar with the lending gap in the SME segment. While others are focused on consumer lending and deposit acquisition, we think ProCredit is well placed to become the financial services partner of choice to the SME segment,” Joel Jimenez of the Menardo Jimenez Family Office added.

Mayank Parekh, founding partner at M Venture Partners (MVP) shared: “Eight in 10 formal loans are channeled to large corporations in the Philippines, leaving 15 million SMEs and workers with little access to traditional finance. MVP is proud to support Adnan and the ProCredit Team in their mission to unlock financing for underserved SMEs. We were impressed with the quality of the team, focused business model, and proprietary underwriting technology to drive financial inclusion.”

The company is keen to speak to debt and equity investors, Philippine market participants, borrowers, and potential partners. ProCredit’s solutions for SMEs can be further explored by visiting http://procredit.ph.

FEU project drives economic empowerment for Batangas women

FEU Head Chemist Jim Cruz teaching women of Quilitisan how to make Amparo soap.

Far Eastern University (FEU) is an active partner of the women of Brgy. Quilitisan, Calatagan, Batangas in the production of Amparo, a handmade soap showcasing beneficial cleansing action and local tropical scents.

Amparo is part of Project Calatagan, a capacity-building program implemented by the FEU Community Extension Services (CES) to drive economic and agricultural sustainability, natural resources management, eco-tourism, and various health-related, socio-political, and psycho-educational development programs.

The university’s CES endorses four variants of Amparo, namely Local Fusion, Earthy Floral, Summer Fresh, and Morning Fresh.

“The women of the community will be provided with a wage rate for every piece of Amparo soap produced,” said CES Director Dr. Luzelle Anne Ormita. “Since most of these partners are homemakers, this is an opportunity for them to have an alternative source of income without having to leave their homes. We hope that this will be a step for them toward economic empowerment.”

Taking a research-based approach is a key component to FEU’s community extension projects. Rather than one-shot volunteer activities, the university focuses on creating long-term, sustainable impact that is anchored on the United Nations Sustainable Development Goals (SDGs).

With Amparo, FEU aims to provide decent work and economic growth to the Brgy. Quilitisan community in adherence to the United Nations SDG 8. Other projects for the community are the organization of the Quilitisan Cooperative and the mushroom cultivation in the area (SDG 2 and 15), all of which pave the path toward building sustainable cities and communities (SDG 11).

Spearheaded by Jacqueline Marjorie Pereda, CES leader of Project Calatagan, the production of Amparo involved a holistic approach that included various training sessions, ongoing quality control measures, and a commitment to continuous process improvement.

The product name Amparo was given by Graciel Lintag of the Academic Affairs Office with respect to the first name of the spouse of FEU founder Nicanor Reyes, Sr.

The actual production began in November 2023. Head chemist Jim Cruz formulated the soap in the FEU laboratory through a series of trials and consecutive consultations with various university departments.

The Spanish word amparo also means “refuge” or “shelter,” which is what the partnership project wishes to offer to the women of Calatagan.

“Our community partners were given hands-on workshops on safety and proper handling of chemicals as part of their training process,” said Ms. Pereda. “Their active participation gained them valuable skills that translate into income-generating opportunities, leaving a spirit of confidence and self-reliance.”

According to Precious Gonzales, one of the soap makers from Barangay Quilitisan, the program has been a great help to them. Aside from the financial gain, she was able to expand her knowledge. Like her, the women became more interested to learn not just about soap making, but also the other livelihood activities that they do together.

Aside from Project Calatagan, FEU also maintains other community extension projects such as Project HOPE (Harnessing Offenders’ Personal Empowerment), which aims for holistic services for women deprived of liberty; Project Mangyan, which aims to improve the living conditions of the indigenous peoples in Occidental Mindoro; and Project SAM, a collaboration with San Agustin Museum to preserve Filipino cultural heritage.

Metro Pacific Tollways finalizing IPO plans 

THE METRO PACIFIC Tollways Corp. (MPTC) said it is currently finalizing its plans for an initial public offering (IPO) as it prepares to bid for a major project in Indonesia.

“It is too early because we are still in the process of valuation between us and San Miguel (San Miguel Corp.) and whether they will accept to include Indonesia, so things will change definitely in the next few months,” Rogelio L. Singson, president and chief executive officer of MPTC, said on the sidelines of a briefing last week.

The company has reaffirmed its target to be listed by 2025 as it is still awaiting certain approvals from its Indonesian operations.

“Our Indonesian [project] is also moving because we just bidded for a huge project there, so things will definitely change and maybe in the next few weeks there will be developments there. If that happens, we will have bigger operations in Indonesia than here in terms of daily traffic,” he said. 

The company bid for a 676-kilometer major concession agreement project in Indonesia, Mr. Singson said.

Last year, MPTC said it needed to raise about $600 million to secure its bid to invest in the Indonesian toll road operator PT Jasa Marga Tbk’s Transjawa Tol.

MPTC has said that the company, along with Singapore’s GIC, is jointly bidding to acquire a portion of the Trans-Java toll road in Indonesia, which operates toll road networks covering a distance of 676 kilometers.

For the year, the company has set a capital expenditure of P28 billion to fund its projects, Mr. Singson said.

Last year, MPTC decided to defer its IPO to 2025, citing the company’s intention to weigh its options in line with a plan to form a joint venture company with San Miguel Corp. (SMC).

“I think so, conservatively because we’re going through evaluation and you can imagine the approval process, “ he said when asked if MPTC’s IPO plans will push through in 2025.

“It is not going to be easy, that is why we are saying the easier thing to do since we are already talking is why don’t we look at specific projects?,” Mr. Singson added. 

The company is in talks with SMC for the possibility of merging some projects as it would be easier and faster to implement, he noted.

MPTC is the tollways unit of MPIC, one of three key Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Ashley Erika O. Jose

ACEN, US firm to develop 1 GW of renewables in Philippines

ACEN CORP. and United States-based renewable energy company BrightNight will jointly develop one gigawatt (GW) of renewables in the Philippines worth $1.2 billion over the next five years, the Ayala-led company said on Sunday.

“Our collaboration with BrightNight reflects our shared ambition to develop superior, hybrid renewable energy solutions,” Patrice Clausse, chief investment officer of ACEN, said in a statement.

“The success of our joint projects in India, which are already winning customers and building capacity, serves as a solid foundation for our venture in the Philippines,” he added.

ACEN, through its wholly owned subsidiary Paivatar Energy Corp., has signed a shareholders’ and investment agreement with BrightNight APAC B.V., the company told the local bourse on Friday.

BrightNight APAC is owned by BrightNight LLC, which is structured to offer utility and commercial and industrial customers with “clean, dispatchable renewable power solutions.”

The deal will mark the second GW-scale renewable energy platform partnership between ACEN and BrightNight, following their collaboration on the development of hybrid renewable energy projects in India with a total capacity of over 1.2 GW.

“ACEN’s leadership in the Philippines’ renewables sector is unparalleled, and we are honored they have chosen to form a partnership with us to develop our portfolio of next generation renewable solutions in their home market,” BrightNight Chief Executive Officer Martin Hermann said.

“They have demonstrated success in scaling and operating large fleets of renewable assets through strategic partnerships across the region, and our existing India partnership is already delivering tremendous value. This is another successful step in our expanding relationship,” he added.

To date, ACEN has approximately 4,700 megawatts of attributable capacity spanning the Philippines, Vietnam, Indonesia, India, and Australia. — Sheldeen Joy Talavera

Philippine T-bills, T-bonds may track US job data

THE RATES of Treasury bills (T-bills) and (T-bonds) would move this week depending on the results of US nonfarm payroll data, traders said at the weekend.

A trader said in an e-mail the rate for the 10-year bond could range from 6.25% to 6.3% as US job creation for February was expected to slow.

The Bureau of the Treasury (BTr) will auction off P15 billion in T-bills on Monday, or P5 billion each in 90-, 182- and 364-day debt.

On Tuesday, it will sell P30 billion of reissued 10-year T-bonds with a remaining life of nine years and 10 months.

US job growth quickened in February, but higher unemployment and moderate wage gains kept on the table an anticipated interest rate cut in June by the US Federal Reserve.

US nonfarm payrolls increased by 275,000 jobs last month, the Labor department said on Friday. Data for January was revised down to show 229,000 jobs created instead of 353,000. Economists polled by Reuters had forecast 200,000 jobs would be added.

Philippine T-bill and T-bond rates could match the mixed movements on the secondary market after inflation picked up in February, Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said in a Viber message.

On the secondary market on Friday, the rates of the 91- and 182-day T-bills rose by 3.6 basis points (bps) and 1.71 bps week on week to 5.7652% and 5.9746%, based on PHP Bloomberg Valuation Service Reference Rates data published on the Philippine Dealing System website. The 364-day T-bill fell by 0.39 bp to 6.1049%.

The 10-year bond gained 0.93 bp to 6.2528%.

Inflation quickened to 3.4% last month from 2.8% in January and 8.6% a year ago.

This was the first time that inflation picked up month on month since September. For the first two months, it averaged 3.1%, within the BSP’s 2-4% annual target.

Last week, the BTr raised P15 billion from its sale of T-bills as total bids reached P36.888 billion, more than twice the amount on the auction block.

The Treasury raised P5 billion from 91-day T-bills as tenders reached P9.428 billion. The average rate for the three-month paper rose by 6.8 bps to 5.778% from the previous week. Accepted rates ranged from 5.75% to 5.799%.

The government likewise fully awarded P5 billion of 182-day securities as bids reached P13.31 billion. The average rate for the six-month T-bill stood at 5.995%, up by 2.4 bps, with accepted rates at 5.989% to 6%.

The BTr also borrowed P5 billion via 364-day debt as demand totaled P14.16 billion. The average rate of the one-year T-bill rose by 1.5 bps to 6.1%. Accepted yields were 6.089% to 6.125%.

The reissued T-bonds to be offered on Tuesday were first offered on Jan. 23, when the government raised P35 billion, higher than the P30-billion program after the BTr opened its tap facility to take advantage of strong demand. The bonds fetched a coupon rate of 6.25% and an average rate of 6.218%.

The BTr is looking at raising P180 billion from the domestic market this month — P60 billion from T-bills and P120 billion via T-bonds.

The government borrows from local and foreign sources to help fund its budget deficit, which is capped at 5.1% of economic output this year. — Aaron Michael C. Sy

Paris Fashion Week: LV’s shimmer, Chanel’s tailored suits, and McCartney’s recycled wool

STELLA MCCARTNEY

PARIS — Louis Vuitton (LV) womenswear designer Nicolas Ghesquiere celebrated his 10th anniversary at the LVMH-owned label with a fashion show that drew crowds to the Louvre Museum at nightfall last Tuesday, the last day of Paris Fashion Week. (Watch the show here: Women’s Fall-Winter 2024 Show | https://tinyurl.com/2974c4jh )

Guests crossed the famous museum’s sprawling Cour Carree — some pausing for photos in booths decorated with LV logos — to reach the venue, a tent that filled an inner courtyard.

It resembled a 19th century French covered market in iron and glass — but with a hulking, futuristic globe with blinking tubes in the center.

“This is a meaningful evening,” the designer wrote in the show notes, a letter to the audience tucked in an envelope left on each seat, recalling the joy of his first show for the label. “Ten years later, this evening is a new dawn.”

An atmospheric soundtrack with scratchy noises and buzzing neon sounds culminated in Mirwais’ “Disco Science.”

Models marched down the runway briskly, in rhythm with the music, showcasing voluminous mini-skirts, shimmery dresses, jewel-encrusted jackets and sheer, light-weight trousers.

Some wore furry mittens, others had knit hats with a flat fold that bounced down the runway, while handbags came in various shapes and sizes.

CHANEL
Chanel designer Virginie Viard sent models down a boardwalk runway evoking the French seaside resort town Deauville, parading tailored suits in tweed, long overcoats and broad sun hats. (Watch the show here: Fall-Winter 2024/25 Ready-to-Wear Show | https://tinyurl.com/28tgpwqx )

The show kicked off with a short film starring Penelope Cruz and Brad Pitt — a nod to Claude Lelouch’s 1966 romantic drama A Man and a Woman. The pair stroll along an empty beach, order steaks and red wine in a restaurant — the scenes featuring shots of a prominently placed Chanel handbag — and the vignette closes with Ms. Cruz’s character calling to the waitress, played by model Rianne Van Rompaey: “Excuse me — sorry, do you have any rooms available?”

The audience burst into applause, and the first model marched out in a mini-skirt, thigh-high boots and long overcoat, her face framed by a wide hat, her handbag swinging.

A series of tweed ensembles followed, with wide-legged trousers and split skirts, as well as handbags of all shapes and sizes.

Adding a contemporary flair, the designer included a short puffer jacket, shearling coats and a shiny black leather jumpsuit in the lineup.

STELLA MCCARTNEY
Stella McCartney drew her audience to a giant greenhouse in a Paris park for her winter runway presentation, where she showed a collection made from recycled wool, nylon, cotton and polyester under bright sunlight. (Watch the show here: Stella McCartney Winter 2024 Runway Show | https://tinyurl.com/2b29u2pp)

Images of melting icebergs flashed on screens as Olivia Colman’s voice rang out on the soundtrack, meant to represent Mother Earth, asking “what will be left of me, after you?”

Models strode onto the runway parading loosely tailored suits with prominent shoulders and low-cut trousers, silky dresses cut asymmetrically, leather-like trench coats made from apple-based material, and hulking cape-like coats made with patchworks of wool.

After the show, Ms. McCartney paused for photos with a stream of guests, including her father Paul McCartney and Ringo Starr, model Paris Jackson, and actress Charlotte Rampling, before huddling with journalists.

Questions focused on the environment, and Ms. McCartney said she preferred positivity to anger when it came to messaging. “It is one of the most harmful industries on the planet and we’re acting like it isn’t,” she said of the fashion industry, noting the idea was to relay a “polite reminder” and offer some solutions.

LVMH group managing director Antonio Belloni described Ms. McCartney’s role in the luxury group as a sort of “muse” for the group on environmental topics, citing her long experience.

Ms. McCartney founded her label in 2001 with a pledge not to use leather or fur, and joined LVMH in 2019.

BALENCIAGA
Balenciaga designer Demna showed a lineup of new styles constructed from repurposed garments for his winter show in Paris, which he sent down a screen-lined runway to an audience that included Kim Kardashian and Serena Williams. (Watch the show here: Winter 24 | https://tinyurl.com/24qaznym)

Models paraded clothing that was pressed together into new shapes, including tops made from jeans, the legs wrapped around the neck, gowns pieced together from an assortment of lingerie and T-shirts layered with tank tops.

The front panel of a dress was a flattened backpack, while a pair of button-up shirts were affixed together with clear tape — one on the front, the other on the back.

“I wanted this show to represent a link between the past and the future of Balenciaga as a house based on creative value,” said Demna in a voice message, delivered to guests via a QR code.

The designer said it reflected an aesthetic he has been developing over the past decade, and that silhouettes were directly inspired by the fashion house’s founder Cristobal Balenciaga.

The Kering-owned label, which sells a large version of its Rodeo handbag for 4,200 euros and visor-like “24/7 Mask” sunglasses for 2,500 euros, is ramping up advertising investments this year after pulling back following a controversy linked to an ad campaign over a year ago that affected sales in the United States, Europe, and the Middle East.

Rising living costs have also prompted a pull-back in spending from fashion shoppers, particularly younger generations.

Balenciaga, has continued to grow sales in Asia, however, outperforming rivals in China, and plans to hold a runway show in Shanghai in May. — Reuters

Filipino engineering students from BatStateU secure 3rd place in World Engineering Day Hackathon

Team AdventURINE of BatStateU, 3rd place winners of World Engineering Day Hackaton 2024

Batangas State University (BatStateU) proudly announces the remarkable achievement of its BS Sanitary Engineering students at the World Engineering Day (WED) Hackathon on March 4. Amidst fierce competition from engineering talents worldwide, Team AdventURINE from BatStateU Alangilan Campus secured 3rd place, raising the flag of the Philippines high on the global stage.

The winners were broadcast during a 24-hour global stream hosted by emcees in Australia and Lisbon, Portugal, substantially boosting the international acknowledgment of their impressive feat.

Organized annually by United Nations Educational, Scientific and Cultural Organization (UNESCO), in collaboration with Engineers Without Borders International (EWB-I) and The Big Creative, the WED Hackathon represents a global initiative for cooperation and innovation in engineering. With over 2,500 students from more than 35 countries participating, this year focuses on Climate Action, resonating with Sustainable Development Goal 12. The challenges were designed to stimulate inventive solutions to some of the world’s most pressing environmental issues.

Team AdventURINE, led by Jose Luis A. Valencia, Nathaniel M. Regodon, and Maureen H. Fadullo, and guided by their mentor Dr. Mark Sibag, showcased their innovative design, “Green Sustainable Phyto-fence Assembled using Cured Source-collected Urine for Urban Environmental Balance (SPACE).” Their solution, a sustainable phyto-fence constructed from treated source-collected urine, addresses Challenge 3: Protecting the Most Vulnerable from Extreme Heat in Refugee Camps and Temporary Shelters.

Their project ingeniously addresses the vital need for cooling in temporary settlements and improving hygiene and sanitation. By encouraging the use of designated urinals and treating collected urine for microalgae cultivation, they create a closed-loop system that promotes both urban living needs and ecological balance.

This solution is powered entirely by solar energy, reducing dependence on fossil fuels and enhancing climate-friendly initiatives. Through their approach, Team AdventURINE demonstrates the power of innovation to address complex challenges while prioritizing sustainability and environmental stewardship.

“The dedication and creativity exhibited by Team AdventURINE exemplify the spirit of innovation and problem-solving that we strive to cultivate at Batangas State University,” remarked BatStateU President Dr. Tirso A. Ronquillo. “Their success on the global stage upholds our commitment to nurturing excellence in engineering education and research,” he added.

Team AdventURINE was awarded a prize of €1,000, acknowledging their impactful work in advancing sustainable solutions for a better world. Following closely behind, Team EcoCool, comprising scholars from Hong Kong University of Science and Technology, University of Illinois Urbana-Champaign, Tokyo Institute of Technology, and Rice University (US), secured second place. Meanwhile, Team Somiant from Yachay Tech University, Ecuador, claimed the top position.

Philippine lenders may remain profitable in Q1 amid high rates

EDUARDO SOARES-UNSPLASH

By Aaron Michael C. Sy, Reporter

PHILIPPINE BANKS are expected to remain profitable this quarter as interest rates and demand for loans remain elevated.

“For the first quarter of the year, continued growth [is expected] amid a high interest rate environment also to be driven by better loan demand,” Luis A. Limlingan, sales head at Regina Capital Development Corp., said in a Viber message. “Improving economic conditions are expected.”

Bangko Sentral ng Pilipinas Governor Eli M. Remolona, Jr. earlier said the central bank is likely to cut interest rates until the second half of the year due to inflation risks.

The Monetary Board raised its key rate by 450 basis points to a near 17-year high of 6.5% from May 2022 to October 2023.

Some lenders hit record earnings last year.

“In 2023, banks with increased consumer segment growth and diversified revenue streams saw the biggest earnings gains,” Mr. Limlingan said.

The top gainers last year were BDO Unibank, Inc., Metropolitan Bank & Trust Co. and Bank of the Philippine Islands, whose earnings hit a record,

First Metro Investment Corp. Head of Research Cristina S. Ulang said in a Viber message.

She noted that competition among banks would be tough in terms of loans and deposits, given the high interest rate environment.

Banks may also find it difficult to surpass their earnings last year, she added.

“Banks will still perform well as loan spreads remain wide and enable loan repricing at elevated asset yields,” Ms. Ulang said.

Bankers Association of the Philippines (BAP) Managing Director Benjamin P. Castillo on Wednesday said banks are optimistic about earnings this year.

“At worst, banks could be at the same level this year,” he said. “But banks are very aggressive. I cannot quote a number but for sure everybody was pleasantly surprised with some very significant uptick in 2023.”

The industry could still face headwinds due to issues overseas including a slowing US economic growth and the war between Russia and Ukraine, Mr. Castillo said.

Mr. Limlingan added that aside from geopolitical tensions, lenders still have to deal with inflation and the need for digitalization.

Hollywood hat trick: Artisan shaped the look of Oppenheimer

LOS ANGELES —  To create the look of renowned physicist J. Robert Oppenheimer for the big screen, his trademark hat had to be just right.

Two hatmakers had failed to replicate the scientist’s unique style when Mark Mejia, owner of Baron Hats, headed to a Hollywood studio lot to try his version on Cillian Murphy, the actor who would play the lead role in Oppenheimer.

Director Christopher Nolan joined the fitting and gave his approval, plus made a tweak of his own.

“He just cranked the brim down a little bit and gave it a little bit of attitude,” Mr. Mejia said.

The hat helped define the silhouette of Oppenheimer, the formidable scientist who led the 1940s race to build the first atomic bomb, in the movie that is the frontrunner to win best picture at Sunday’s Academy Awards.

Mr. Mejia has three decades of experience making hats by hand for A-list movie stars from Clint Eastwood to Leonardo DiCaprio and musicians from Bob Dylan to Beyoncé.

His workshop sits on the third floor of a century-old building in downtown Los Angeles. On the first floor is B. Black & Sons, a family-owned woolen house that has supplied fabric for costumes since Gone with the Wind.

A hand-operated elevator shuttles visitors up to the Baron Hats showroom and workshop. Doors open into what looks like a museum of memorable Hollywood moments. Among dozens of hats on display is a cowboy hat from Eastwood’s Cry Macho. Across the room is a straw boater donned by Johnny Depp as gangster John Dillinger in Public Enemies. A reproduction of Jim Carrey’s yellow, feather-adorned fedora from The Mask sits on a green-faced bust.

“It’s a long list,” Mr. Mejia says when asked to name the projects he has worked on, which include thousands of hats over the years.

He mentions the Russell Crowe drama 3:10 to Yuma, TV series Justified, and Quentin Tarantino’s Django Unchained, plus work for bands such as AC/DC and Cheap Trick.

On the wall, a framed Rolling Stone magazine cover features folk singer Mr. Dylan wearing a silver hat made by Mr. Mejia, with a handwritten note of thanks from the singer. A photo shows Beyoncé sporting a black hat with a giant brim for her Formation tour. Mr. Mejia also is working on current projects with Beyoncé.

Rows of shelves feature reproductions of famous movie hats, such as the fedoras sported by Dick Tracy and Indiana Jones, that Baron sells to the public. Baron uses the original wood blocks used on the productions to recreate the shapes.

FROM SKETCHES TO THE SCREEN
A California native, Mr. Mejia started learning his craft after working as a science technician for the Los Angeles school district. He felt he had little job security and searched for another career, joining a friend who was a hatmaker in New York.

In 1993, Mr. Mejia apprenticed with Baron Hats founder Eddie Baron, who had started working for movie stars including John Wayne in 1969 and become Hollywood’s go-to hatter. Mr. Baron sold the business to Mr. Mejia in 1995.

To create a hat for a film, Mr. Mejia typically works from sketches supplied by costume designers and must figure out how to bring their ideas into three dimensions.

He often works with beaver or rabbit felt. Once a rough shape has been created, the felt is heated and steamed so that Mr. Mejia can stretch and shape it into the precise form.

“To really capture the silhouette of the costume, and the movie itself, it takes a lot of manipulating of the felt to really create the exact, iconic style that you want,” he said.

The Oppenheimer hat was an unusual shape. Costume designer Ellen Mirojnick describes it as a porkpie crown combined with something between a fedora and a cowboy brim.

Ms. Mirojnick, who is nominated for best costume design at Sunday’s Oscars, studied black-and-white images and had to guess the hat’s color, deciding on a taupey gray. Designs were sent to hatmakers in Italy and New York, but neither could nail it.

Much closer to Hollywood, she found Mejia, who she said “hit it out of the park immediately.”

Getting it right was important, Ms. Mirojnick said, because the real-life Oppenheimer had intentionally crafted his look.

The hat, she said, was “part of the image that Oppenheimer created as he stepped into his power and opened up Los Alamos,” the New Mexico lab where the bomb was created. “He wore it all the time.”

Mr. Murphy wears one hat in the movie, reflecting the fact that Oppenheimer kept the same look throughout his life. At Mr. Nolan’s direction, most other characters in the film do not wear hats.

Mr. Mejia said he never sought a career working with celebrities, but he enjoys seeing his hats on film.

“There’s a lot of gratification and satisfaction,” he said, “when you actually build something with your hands from scratch and see it on the big screen.” — Reuters

Leveraging social media to promote financial literacy 

By Andrea C. Abestano, Researcher

SCROLLING THROUGH social media means more than merely about likes and shares today. It has become an instrument for financial literacy for many Filipinos.

As of January, almost 73.6% of Filipinos had access to the internet, of which 73.4% were connected through one or more social media platforms spending four hours a day on average. This was the highest daily consumption across all Asian countries included in Meltwater’s Global Digital Report.

Interweaving digital influence and consumer behavior, social media has become a key player in spreading information in the country.

In an era where digital connectivity has become a dominant aspect of Filipino lives, banks and financial institutions have also begun to acknowledge its importance and utilize it.

All banks in the country have built a dedicated social media page across various platforms in which consumers can connect with the banks.

The 2024 Global Digital Overview showed that 34.2% of internet users utilize the web for information on finance and savings, inching up from 33.7% in 2022. For the country, almost 42.3% of the population turn to social media for finding content and information.

Similarly, based on the 2021 Financial Inclusion Survey (FIS), 32% of Filipinos rely on these platforms for financial-related information.

“Statistics show that social media has been a source of financial information and has influenced financial decision-making,” the Bangko Sentral ng Pilipinas (BSP) said in an e-mail interview.

“Social media has transformed financial literacy for the youth by offering easily comprehensible content on topics like financial planning, credit, and investing, often with humor,” said the BSP.

Inclusivity in the younger generations saw an uptick in 2021 as more than a fourth of individuals aged 15-19 had formal bank accounts, almost four times higher from 7% in 2019, according to the central bank’s latest Financial Inclusion Dashboard.

Similarly, almost half of the older adults owned a formal account, an improvement from 32% in 2019.

The ease of accessing information, captivating content, and the convenience of customer support were the key factors on social media that contributed significantly to the improvement of literacy.

Johann C. Uy, a member of Facebook (FB) groups focused on investment talks, said that social media helped him be a part of the “banked” population.

“When I opened my first savings account, what I did was look up suggestions on social media groups and communities and read up on [comment] threads to determine which bank is crypto-lenient and would fit my needs,” he said in phone interview.

Ease of information allowed them to compare products, services, and financial approaches across social media pages and posts.

“In finding which car loans would be perfect for my new car, I had to compare across the pages of different banks and the experiences of content creators until I had decided on which one to go with,” said Beverly A. Arevalo, a member of finance-related FB groups, in a phone interview.

On top of the accessibility, how the topic was discussed also helped the consumers digest and remember the information.

“The new audience is the millennials, the aggressive ones, if they see [finance-related] information, they see it as boring or not interested in it. People are more engaged if they see the information in entertainment or as funny content and something they would spend time browsing,” said Joel Khristopher S. Cabugos, cofounder of KasKasan Buddies, an FB group focused on credit card hacks promos and other financial topics.

“Relatability is a big factor as to why people watch videos and content on social media about finances. Particularly in content creators, you see their struggles and relate to it then you see their success and try to replicate their money handling,” said Randy A. Arevalo, consumer of TikTok clips on financial topics.

Based on the January 2024 Meltwater data, 43.9% of Filipinos follow influencers and other experts on social media.

Kimberly C. Soriano, manager at a financial institution and consumer of money-handling topics on Facebook, said that “social media offers simpler and more engaging content which makes learning finances fun and easier to remember.”

Similarly, content creators and social media influencers saw that today’s generation is more likely to learn the information by making it more interactive and less technical.

“I can see that a shift has occurred in recent years as creators made financial information more available and less intimidating for Filipinos,” said Prexel Parnacio, owner of the Millionaire in Progress (MIP) academy coaching program and TikTok finance influencer.

For KasKasan Buddies’ Mr. Cabugos, content creators promote financially literate Filipinos by giving them a space to discuss topics that they may be afraid to ask their bank about such as credit card usage.

“Our goal [as creators] is to make the information as simple and engaging as possible so we can slowly onboard the majority of Filipinos in proper finance handling,” Mr. Cabugos said.

Banks have also noticed today’s reliance on social media for customer service interactions.

The central bank sees these platforms as an avenue for BSP-supervised financial institutions (BSFIs) to interact with customers, address concerns, and foster brand building.

The availability of chatbots and case resolution services via the banks’ social media platforms helps consumers deal with their finances better than the old-school customer service calls and bank visits.

“For simple issues and concerns, I would prefer online services like chatbots and chats with customer service,” said Ms. Arevalo. “If the banks had services for more complex document processing requests, I would prefer to do it online as well instead of having to schedule to go onsite. It is a time hassle.”

APPROACH
Amidst this digital landscape, it is no surprise that banks and institutions have leveraged platforms like YouTube, Facebook, and Google to engage with consumers through them.

Banks employ various approaches including organic ad reach and internet campaigns to inform users about product offerings and services.

“The algorithm of social media works like this: if a post on a specific product or topic caught your interest and you interacted with it, expect to see the same product or topic appearing on your feed in the future,” Mr. Cabugos of KasKasan Buddies said.

Audience engagement with bank products on social media, ranging from credit cards to high-interest savings accounts, shows the importance of targeted marketing strategies.

Development Bank of the Philippines (DBP) President and Chief Executive Officer Michael O. de Jesus said in an e-mail that “through [this] strategic analysis of audience interactions and feedback, the bank gains insights into the preferences and priorities of its online community, enabling more targeted and effective outreach efforts.”

Although external link advertisements remain a common tool in banks’ marketing, data by Meltwater showed a 19.6% decline in external link traffic shares attributable to organic social media in the past 12 months.

On the other hand, the Philippines leads as the top consumer of vlogging content creators with a significant 55.6% of daily vlog consumption, 60.4% of which uses online video as a source of learning.

Keeping up with this trend, both Maybank Philippines, Inc. and DBP had altered their marketing approach to meet the current consumption habits.

“Our content [has adapted to] using informative short videos or stories to drive the messaging. However, we do still maintain presence in traditional media, and throw in events into the mix,” Maybank said in an e-mail.

BSP, on the other hand, launched campaigns that aim to make “friendlier” contents such as #BSPExplained, which releases definitions of terms of technical concepts in the local language, and PisoLit which releases creative and funny cartoons focused on saving, personal finance, and fraud prevention.

In handling customers via social media, BSP, Maybank, and DBP utilized chatbots and dedicated teams online.

While Maybank leverages both automated responses and real-time responses, DBP utilizes automated responses focused on frequently asked questions.

The BSP also launched a dedicated chatbot by the name BSP Online Buddy or BOB in FB Messenger to make it more accessible to financial consumers.

Banks have also tapped into collaboration with content creators for social media marketing and awareness campaigns.

Both TikTok coach Ms. Parnacio and KasKasan Buddies’ Mr. Cabugos have had numerous collaborations with banks.

“I have had partnerships mostly with banks and other institutions to create awareness campaigns on how to avoid being a victim of these fraudsters as well as what to do if you become a victim,” Ms. Parnacio said.

Similarly, Mr. Cabugos cited his experience in working with banks for credit card campaigns.

“Once, we partnered with RCBC in credit card applications, and the process got delayed due to the massive volume of applicants,” he said.

“If it was not for the collaboration, we would not have been able to coordinate the experience of the users to the banks and the banks would not have been able to respond via announcement to the users.”

“Collaborations allow the users to have their voice heard by the institutions,” Mr. Cabugos said.

RISKS AND DANGERS
Despite the opportunities available in using social media as a platform of financial literacy, challenges such as fake news and fraud remain.

For content creators, a common issue experienced is the rise of fake accounts that copy them and swindle their followers.

“I am not sure how they do it, but they copy my account from contents to pictures to texts then they contact my followers asking for money,” Ms. Parnacio said.

“This was detrimental for both the followers and the creators who might lose their credibility because of such events,” she added.

Mr. Uy, an employee who follows creators focused on trading and finances online, said that he experienced the same situation but was able to evade it by taking time to discern and research the page.

“I noticed that the like count is unusually lower than the original page and when the creator started subtly asking for my money, I knew something was up. However, if I had not become vigilant, I might have been scammed,” he said in a phone call interview.

Additionally, there is also data permanence, a problem felt by both banks and users. Once an information, comment, or post has been released on social media, copies of it may remain even if the information — be it good or bad — has been removed or deleted.

“What goes on social media, stays on social media,” said Maybank.

Alongside creators and users, banks also advocate for vigilance and due diligence in researching the person you follow and the content you digest online.

LEVELING UP
Looking ahead, social media is bound to stay as part of the marketing mix for banks and an influencer on consumer decisions.

For the consumers, speed in conflict resolution as well as a wider range of customer service transactions are factors that the banks can still improve on their social media utilization.

More engaging and gamified contents were recommendations by the social media personalities.

“More collaborations with creators and banks would help users be more at ease with grasping concepts. However, financial institutions should be careful of who they partner with,” said TikTok coach Ms. Parnacio.

KasKasan Buddies’ Mr. Cabugos, on the other hand, said that gamified contents would help gather the personalized feedback of the users on the banks.

“Generate more gamified financial literacy content that people can participate and get involved in. The more involved the person is, the higher the chance of the content being shared across their peers,” he said.

“Banks will have to recognize social media overlaps. People have multiple accounts that they log into [and to keep up with this] banks and content [should] not live on one channel only, it travels across,” said Maybank.

BSP expects wider utilization of these platforms in the future as “it can provide access to previously untapped segments for financial education and integration.”

As social media evolves and more people rely on it for financial insight, the responsibility to remain critical in the spread of information relies on every member of the financial sector — banks, financial institutions, content creators, and users. 

Meralco declares failed bid for 260-MW power supply

MANILA ELECTRIC Co. (Meralco) may have to resort to the spot market for power source after failing to secure bids for the 260-megawatt (MW) peak requirement in preparation for the increase in demand during the dry months.

The power distributor did not receive any expression of interest for the second round of competitive bidding upon the deadline on March 8, according to a document from Meralco’s website. 

“The bidding is considered to have failed since ‘[n]o captive market supplier purchased the bidding documents after the deadline set in the published [Final Invitation to Bid/Terms of Reference],’” the company said.

Lawrence S. Fernandez, chairman of Meralco’s bids and awards committee for power supply agreements, said on Friday that the company may have to purchase power from the Wholesale Electricity Spot Market, which serves as the trading floor for electricity.

“If there will be no [bidders for] 260 [MW] today, then we will have to resort to use more of the other contracts. If they are already at their limit, they will have to get from the spot market,” Mr. Fernandez said in mixed English and Filipino.

Citing the rules of the Energy Regulatory Commission (ERC), he said that the company may also engage in negotiated procurement after two failed bids.

“We know that historically, prices in the [spot] market rise during summer months because more [consumers] need electricity,” said Joe R. Zaldarriaga, Meralco’s spokesperson and vice-president for corporate communications.

“So, if we will not cover our requirements through an interim power supply agreement, we may have a problem because we will be exposed to the [spot] market,” he added.

Last month, Meralco announced that two bidders had withdrawn their expressions of interest, resulting in a failed bidding process, prompting the company to initiate a second round.

The two interested bidders, 1590 Energy Corp. (1590 EC) and San Roque Hydropower, Inc. of San Miguel Global Power Holdings Corp. (SMGP), did not proceed with submitting bids by the deadline on Feb. 26.

A document from Meralco showed that 1590 EC decided to withdraw due to the “excessive and unreasonable bid security required.”

The power distributor said that the computation or requirement for bid security in the bidding process only followed a provision of the ERC’s guidelines on competitive selection process.

It prescribed the amount of the bid security to be “equivalent to [the] three-month contract cost of the proposed power supply agreement using the bid price offered by the bidder.”

Meanwhile, Meralco and Limay Power, Inc., another subsidiary of SMGP, said they would file a joint application with the ERC to seek the approval of their 400-MW power supply agreement.

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. — Sheldeen Joy Talavera

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