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Mixed Fed messages lead to partial bond award

BW FILE PHOTO

THE GOVERNMENT made a partial award of its dual-tranche offer of Treasury bonds (T-bonds) on Tuesday amid weak demand for the longer tenor as several US Federal Reserve officials said they remain cautious about further policy easing.

The Bureau of the Treasury (BTr) raised just P26.848 billion via its dual-tenor T-bond offer, below the P35-billion plan, with total bids reaching P63.666 billion. This came as it made a partial award of the longer tenor it placed on the auction due to weak market appetite.

Broken down, the Treasury borrowed the programmed P10 billion via the reissued seven-year bonds if auctioned off, with total bids reaching P37.924 billion or almost four times the amount on offer.

This brought the total outstanding volume for the bond series to P361.4 billion.

The bonds, which have a remaining life of two years and seven months, were awarded at an average rate of 5.605%. Accepted yields ranged from 5.6% to 5.61%.

The average rate of the reissued papers went down by 2.9 basis points (bps) from the 5.634% fetched for the series’ last award on Aug. 27 but was 198 bps above the 3.625% coupon for the issue.

This was also 0.5 bp above the 5.6% fetched for the same bond series but 5.6 bps lower than the 5.661% quoted for the three-year bond — the benchmark tenor closest to the remaining life of the issue — at the secondary market before Tuesday’s auction, based on PHP Bloomberg Valuation Service (BVAL) Reference Rates data provided by the BTr.

Meanwhile, the government raised just P16.848 billion from its offering of reissued 20-year T-bonds out of the P25-billion plan, even as tenders reached P25.742 billion.

This brought the total outstanding volume for the bond series to P229.6 billion.

The notes, which have a remaining life of 18 years and eight months, were awarded at an average rate of 6.421%. Accepted yields were from 6.35% to 6.45%.

The average rate declined by 16.3 bps from the 6.584% fetched for the series’ last award on July 29 and was also 45.4 bps lower than the 6.875% coupon for the issue.

However, this was 8.2 bps above the 6.339% seen for the same bond series and 7.5 bps higher than the 6.346% quoted for the 20-year bond at the secondary market before Tuesday’s auction, PHP BVAL Reference Rates data showed.

The first trader said the mixed results of the auction were within the market’s expectations.

“There was healthy demand for the three-year tenor as investors favored the yield pickup in this space relative to T-bills (Treasury bills). This reflects a cautious willingness to extend holdings toward the three- to five-year space moving forward,” the trader said in a text message.

“For the 20-year, the tepid reception was understandable. Market participants remain guarded given the recent uptrend in US Treasury yields alongside lingering domestic concerns, such as governance and fiscal risks, that could weigh on long-term confidence.”

The government is currently investigating alleged corruption in state flood-control and infrastructure projects, with some lawmakers and Public Works department officials being accused of receiving payoffs and using the national budget to make insertions to fund these kickbacks.

Finance Secretary Ralph G. Recto earlier said corruption related to these projects may have cost the Philippines up to P118.5 billion in economic losses since 2023.

The second trader said that the shorter tenor was met with good demand on expectations of further rate cuts by both the Fed and the Bangko Sentral ng Pilipinas (BSP) for the rest of the year.

“The 20-year T-bonds were not well received due to the less dovish Fed approach for 2026, which weighed on longer-dated tenors,” the second trader said in a phone interview.

Last month, the BSP lowered borrowing costs by 25 bps for a third straight meeting to bring the policy rate to 5%. It has now slashed benchmark rates by a cumulative 150 bps since it began its easing cycle in August 2024.

BSP Governor Eli M. Remolona, Jr. has left the door open to one last cut this year to support growth if needed, which would likely mark the end of its current easing cycle. The Monetary Board’s last two meetings this year are scheduled for October and December.

Meanwhile, the Fed last week lowered its target rate by 25 bps to the 4%-4.25% range, which was its first cut since December. This brought its total reductions since September 2024 to 125 bps.

Its “dot plot” showed projections of two more rate cuts this year.

St. Louis Fed President Alberto Musalem, who votes on Fed policy this year, said the central bank “should tread cautiously,” as its policy rate accounting for inflation might already be close to neutral, Reuters reported.

Atlanta Fed President Raphael Bostic, in a Wall Street Journal interview, said the focus needed to remain on ensuring inflation returns to the Fed’s 2% target from a current level about a percentage point higher and that further rates cuts this year were not needed.

Cleveland Fed President Beth Hammack also said the Fed “should be very cautious in removing monetary policy restriction.” Neither Mr. Bostic nor Ms. Hammack votes on Fed policy this year.

Meanwhile, new Federal Reserve Governor Stephen Miran said on Monday the Fed was misreading how tight it has set monetary policy and would put the job market at risk without aggressive rate cuts.

Fed Chair Jerome H. Powell was set to speak on the economic outlook later on Tuesday.

Traders have reined in bets of interest rate cuts at the Federal Open Market Committee’s October meeting, with Fed funds futures implying a 10.2% chance of a hold, compared to a probability of 8.1% on Friday, according to the CME Group’s FedWatch tool.

The BTr raised P211.848 billion out of the P220-billion borrowing program for September, with Tuesday’s auction seeing the sole partial award made this month.

Next week’s Treasury bill and T-bond auctions will be part of the October program as their issuance dates will fall within that month. The BTr has not yet released its fourth-quarter borrowing plan.

The government borrows from local and foreign sources to help fund its budget deficit, which is capped at P1.56 trillion or 5.5% of gross domestic product this year. — Aaron Michael C. Sy with Reuters

P7.75-B REIT share sale seen to give RLC flexibility for capex, asset growth

BW FILE PHOTO

By Beatriz Marie D. Cruz, Reporter

GOKONGWEI-LED developer Robinsons Land Corp. (RLC) raised P7.75 billion from an overnight block sale of one billion shares in its real estate investment trust (REIT) unit RL Commercial REIT, Inc. (RCR), which, according to analysts, will provide capital for long-term expansion and could enable RLC to inject additional assets into the REIT.

“The P7.75 billion raised from the overnight block placement in RCR gives RLC more room to drive growth, reduce debt, and fuel long-term expansions,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“It also opens up market opportunities in residential, commercial, and mixed-use developments, as consumer behavior shifts and new trends emerge,” he added.

RLC told the stock exchange on Tuesday that the shares were sold at P7.75 each, at the top end of the marketed range, and that the offering was oversubscribed by 3.7 times.

“The transaction saw strong participation from both local institutional investors and fresh foreign accounts,” the company said.

COL Financial Group, Inc. Chief Equity Strategist April Lynn Lee-Tan said the proceeds will fund RLC’s capital expenditures (capex) and enable further asset injections into RCR, which could be dividend accretive.

“It’s also good for RCR, since it will open the door for more asset injections for RLC, which is dividend accretive,” she said.

Following the sale, RCR’s public float rose to 39.34%, equivalent to 7.69 billion shares.

Its current portfolio includes 828,000 sq.m. of gross leasable area (GLA), comprising 12 malls with 289,000 sq.m. GLA and 17 offices with 539,000 sq.m. GLA.

RLC’s sale follows a P30.67-billion property-for-share swap that infused nine commercial projects with a combined 324,107.75 sq.m. GLA into RCR.

Analysts, however, cautioned that RLC must carefully manage capital allocation and market timing to sustain earnings growth.

The transaction was exempt from registration under the Philippine Securities Regulation Code and offered offshore under Regulation S of the US Securities Act of 1933.

BPI Capital Corp. acted as sole global coordinator, joint bookrunner, and domestic placement agent, while J.P. Morgan Securities Plc and Maybank Securities Pte. Ltd. were joint bookrunners and international placement agents.

Proceeds are scheduled for settlement on Sept. 25.

RLC said it will submit a reinvestment plan detailing the use of proceeds, in line with regulatory requirements.

On Tuesday, RLC shares closed flat at P15.26, while RCR shares fell 4.53% or 37 centavos to P7.80 each.

Connecting the dots with Nena Saguil

Untitled, 1990, oil on canvas work by Nena Saguil

AN EXHIBIT featuring rare and representative works from every decade of artist Nena Saguil’s career will be shown from Sept. 26 to 28 at the Discovery Primea hotel.

The exhibit, titled saliNlahi: Connecting The Dots with Nena Saguil, is presented by the Art House in collaboration with the Nena Saguil estate.

“It’s really to showcase Nena Saguil as a very iconic Filipino female artist in the current day,” said Art House founder Carlo Pineda in a speech during a press conference at the Discovery Primea hotel on Sept. 16. Earlier this year, Art House also mounted a Nena Saguil exhibit. “We believe that there’s a lot more to understand about her practice, the different eras of her pieces, and the discipline that she put in her practice.”

Artist Marika Constantino, collaborating with Art House as the curator of the exhibit, said, “Salinlahi is an exhibition that bridges the different decades of Nena Saguil’s life. From the ’50s to the ’90s, we have representative artworks that will be featured in the show.”

CHANGES THROUGH THE YEARS
Nena Saguil (1914-1994) studied Art at the University of the Philippines under Fernando Amorsolo, thus influencing her own more figurative work during her early period. In time, she would come to be one of the pioneers of the Filipino Modernist school, counting among her contemporaries National Artists Vicente Manansala and Arturo Luz. Ms. Saguil was posthumously granted the Presidential Medal of Merit in 2006.

“We also find out how all these different decades are actually representations of her different styles and techniques, or manner, thinking, or even her health,” Ms. Constantino said, pointing at some pieces produced in the ’90s, during a period of failing eyesight before the artist died in Paris in 1994.

Her brother Ben Saguil, present at the press conference, said in a statement, “There were several phases in her artistic journey starting from the early years. In the mid ’40s and ’50s, she created figurative works influenced by her professors in the University of the Philippines. Nena made a few off-tangent works that were shaped by Picasso and Matisse. The latter part of the ’50s was an experimental and exploratory phase, which produced many of her abstract works. She then began to develop her style using spheres, circles, space and pointillism until the ’70s.”

“You could see how her work evolved,” he said in a speech. From the ’50s, ’60s, and the very different strokes which are not available in the market are those that were done from 1991 to 1994.

“What defines her more are the circles; that pointillist art that she focused on for about 20 years” he said, specifically the late 1960s to the 1980s.

DIGITAL DATABASE
Mr. Saguil said that they have been working on a digital database to prevent any forged artworks from appearing in the market, a problem they faced five to 10 years ago. “We totally blocked them from the market, because of the way we authenticate,” he said. From now on, all the Certificates of Authenticity from the Saguil estate will come with a unique QR Code that should match with what the estate has in their database.

The press conference also served to launch a line of tableware and linens printed with Nena Saguil’s work. “We are also looking to connect with the next generation, which is why we are also developing a merchandise collection that features works by Nena Saguil,” said Mr. Pineda in a statement.

“We want her work to transcend generations. For us, we see her as a Philippine master,” said Mr. Pineda.

Connected to what Mr. Saguil said, Art House will be the exclusive dealer of the late Ms. Saguil’s work, with the support of her estate. “We will be able to manage the flow and distribution of the works,” he told BusinessWorld. “Access point will be us, but authentication and provenance would come from them.”

The exhibit saliNlahi: Connecting the Dots opens on Sept. 26 and will run until Sept. 28 at the Discovery Primea Hotel, Ayala Ave., Makati. — Joseph L. Garcia

Planters Products, Inc. to hold Annual Stockholders’ Meeting on Oct. 21 via Zoom or in person

 

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PAL starts rollout of refurbished aircraft

PHILIPPINE STAR/EDD GUMBAN

PHILIPPINE AIRLINES (PAL) has begun deploying its first refurbished aircraft as part of a retrofitting program that will see 18 planes operating across Asia through 2027, the flag carrier said on Tuesday.

In a media release, PAL said the retrofitted aircraft were upgraded at Lufthansa Technik Philippines’ (LTP) facility in Manila.

The program covers 18 Airbus A321ceo aircraft, which will operate on routes to Tokyo (Haneda and Narita), Osaka, Jakarta, Bali, and Guam starting this year, and on other key markets in PAL’s Asian network by 2026–2027.

“This cabin retrofit program reflects PAL’s vision of world-class excellence and heartfelt care. At the core of this undertaking is the dedicated craftsmanship showcased by Filipino workers in the manufacture of aircraft seats and the reconfiguration of the cabin in the Philippines,” said PAL Vice-President for Marketing Alvin Miranda.

PAL said the rollout is part of its fleet modernization program, with three refurbished aircraft scheduled this year, nine by 2026, and six in 2027.

“The retrofit project is the first aircraft program done by any local airline utilizing Filipino skilled workers for seat production and installation, and various aspects of cabin upgrading,” PAL added.

The upgraded cabin accommodates up to 194 passengers in a dual-class layout, with 12 Business Class and 182 Economy Class seats.

PAL said the cabin offers more space and privacy while enhancing overall passenger comfort.

PAL is also preparing for the delivery of nine Airbus A350-1000s and 13 A321 New Engine Option (NEO) aircraft, which will be deployed on nonstop flights to North America and other international destinations.

The first batch of these aircraft will arrive this year.

For the second quarter, PAL Holdings, Inc., the airline’s operator, reported attributable net income of P3.33 billion, up 40.51%, driven by higher passenger volumes.

Total revenue reached P46.39 billion, up 2.81% from P45.12 billion in the same period a year ago, mainly supported by a 1.11% rise in passenger revenue to P39.94 billion from P39.5 billion.

On the local bourse on Tuesday, PAL Holdings shares closed one centavo higher, or 0.25%, at P3.98 apiece. — Ashley Erika O. Jose

Weaving art

THE 37th edition of Conrad Manila’s Of Wine and Art series celebrates weaving through the work of seven female artists.

Her Hands: A Loom of Stories was launched on Sept. 16 at Conrad Manila’s Gallery C, featuring 34 works by Kristine de Jesus, Anita del Rosario, Jane Ebarle, Mia Go, Katrina Raimann, Anina Rubio, and Maria Salvador.

Gallery C’s curator Nestor Jardin told BusinessWorld that the show came from a proposal to feature women artists. “Three of them had works that depicted weaving, in various styles.” He then decided to reformat the show for seven artists, so long as they all featured weaving, either the act, the resulting craft, or a woven piece itself. “It’s a very important aspect of our culture. Women are usually the ones who undertake this traditional craft,” he said.

Ms. De Jesus has four works, all in acrylic and ink on canvas, showing patterns on a blue background. Ms. Del Rosario parlayed her talent in jewelry design to create sculptures in mother-of-pearl and other materials, while Ms. Ebarle created works in acrylic depicting clothing. Kawes 30 CH, one of the works displayed, was made of layers upon layers of acrylic, with the skirt of the traje de mestiza (the traditional garb of a Filipina gentlewoman) that she painted floating off the canvas.

Ms. Go showed works made of handwoven cotton wool and acrylic yarn, as well as jute and raffia. Meanwhile, Ms. Raimann’s works were executed in burlap, cotton, wool, and acrylic yarn. Ms. Rubio showed several works in discarded fabric on handmade bamboo frames. Ms. Salvador showed fabric and fiber on textile.

“Together, these works remind us that weaving is more than a dream. It is an act of care, of resilience, and of imagination. It is how fragments become whole, and how stories, both personal and collective, are carried forward,” Ms. De Jesus, speaking on behalf of her fellow artists, said in a speech.

The exhibit runs is ongoing until Nov. 15.

Conrad Manila is offering a new afternoon tea experience at C Lounge which was inspired by the featured art collection. Available throughout the exhibit’s run, this celebrates both art and culture through a selection of bites and sips. The set includes baked gillardeau oysters, pan-seared lamb chops, US choice beef tenderloin, pan-seared lapu-lapu, signature C Lounge burger, Eton Mess, raspberry cheesecake, vanilla panna cotta with passion fruit and coconut sorbet, roasted coconut semifreddo with mango popsicle, and more.

The Conrad Manila is at the Seaside Boulevard, Coral Way, in Pasay City. — Joseph L. Garcia

The Papal guidelines on artificial intelligence

STOCK PHOTO | Image by Igor Omilaev from Freepik

(Part 1)

Literally from the very first moment of his being elected Supreme Pontiff of the Catholic Church, Pope Leo XIV made it clear that he will use his infallible Teaching Authority as Pope to give all men and women of goodwill much needed ethical or moral guidelines on the use of artificial intelligence (AI) in all relevant aspects of daily lives.

The scene will always be imprinted in the minds of some 30 of us business and economic professionals from the Philippines who had just completed a three-day seminar on the uses of AI in business and economic leadership at the prestigious IESE Business School in Barcelona, Spain.

Almost coinciding with the last session of the seminar was the announcement from Rome that the Conclave had elected the next Pope to succeed Pope Francis. When the newly elected Pope appeared to address the world, he announced that he had chosen the name Pope Leo XIV because he wanted to follow the example of Pope Leo XIII who, in 1891, issued the first so-called “social encyclical” entitled Rerum Novarum which gave moral and ethical guidelines concerning the First Industrial Revolution (IR 1.0) that ushered in capitalism. Pope Leo XIV specifically referred to Artificial Intelligence (AI) as one of the new technologies introduced in the ongoing Fourth Industrial Revolution (IR 4.0) that urgently need moral guidelines to safeguard human dignity, security, transparency, and ethics.

No one should be surprised that a North American Pope would have on top of his mind giving moral guidelines on AI (as well as the other components of IR 4.0 such as robotization, Internet of Things, data analytics, etc.) since his country of origin leads the world in this Fourth Industrial Revolution.

When England led the world in the First Industrial Revolution, moral leaders were caught off guard about the many abuses that IR 1.0 brought with it, e.g., abuses against the human rights of workers, unethical business practices, the destruction of the physical environment through pollution, and many others that were vividly described by novelists like Charles Dickens. The First Industrial Revolution is usually considered to have transpired from 1790 to 1830. Rerum Novarum was issued only in 1891, a century after the appearance of IR 1.0. Pope Leo XIV will make sure that the doctrinal lag will be shorter this time.

No one will deny that IR 1.0 brought many benefits to humanity. The invention of the steam engine, the spinning jenny, and the other capital-intensive technologies associated with the IR 1.0 did much to improve the standards of living of the population, including the masses, although the distribution of income and wealth continued to be inequitable. The same could be said about the subsequent Industrial Revolutions, i.e., IR 2.0 (the Electricity Revolution) and IR 3.0 (the Electronic Revolution). There were, however, the dark sides of the new technologies that went against human dignity, such as low wages, poor working conditions, monopoly prices, production of hazardous wastes, etc.

For over more than a century, succeeding Popes continued to write social encyclicals giving more ethical guidelines as capitalism (and the opposing system of socialism/communism) continued to generate both benefits and costs to humanity. Some of the more famous encyclicals that followed Rerum Novarum were Quadragessimo Anno, Populorum Progressio, Laborem Exercens, Solicitudo Rei Socialis, Centessimus Annus, Laudato Si, and Fratelli Tutti. These papal encyclicals addressed the social and economic problems that resulted from the continuing evolution of modern industrial society, such as worker rights and dignity, economic justice and development, peace and human rights, ecological concerns, and global solidarity.

Analogous to the advent of the technologies that were ushered in by the first and subsequent industrial revolutions, Artificial Intelligence brings a wide range of benefits to society, impacting nearly every aspect of modern living in the 21st century. A quick check with Chat-GPT resulted in the following summary of the main societal benefits of AI:

1. Improved Healthcare. Faster diagnoses using AI-powered tools (e.g., image recognition for cancer detection). Predictive analytics for disease outbreaks and patient deterioration. Personalized treatment through AI-driven analysis of genetic data. Robotic surgery that enhances precision and reduces recovery time. Specific example: AI systems can detect diabetic retinopathy or breast cancer earlier than human doctors in some cases.

2. Safer and Smarter Transportation. Autonomous vehicles (self-driving cars, drones) reduce human error. Traffic management systems improve road safety and reduce congestion. Logistics optimization reduces carbon emissions and delivery times. Specific example: AI helps ride-sharing companies (like Uber) route drivers more efficiently.

3. Enhanced Education. Personalized learning platforms adjust each student’s pace and needs. AI tutors and chatbots provide real-time support and feedback. Automated grading saves teachers time for deeper engagement with students. Specific example: Tools like Duolingo use AI to adapt language lessons for optimal learning.

4. Economic Growth and Innovation. Boosts productivity through automation of routine tasks. Creates new industries and job opportunities (AI ethics, data labeling, etc.). Supports decision-making in businesses through predictive models and data analytics. Specific example: AI tools help small businesses forecast sales and optimize inventory.

5. Environmental Protection. Climate modeling and disaster prediction help mitigate environmental risks. AI in agriculture improves crop yields and reduces waste. Energy optimization for smart grids and green buildings. Specific example: AI-powered drones monitor forest health and detect illegal logging.

6. Public Safety and Disaster. AI surveillance systems help in crime prevention and emergency response. Natural disaster prediction (e.g., earthquakes, floods, volcanic eruption). Search and rescue operations enhanced by AI-powered robotics and mapping. Specific example: AI tools helped map affected areas during hurricanes or wildfires to coordinate rescue.

7. Accessibility and Inclusion. Speech-to-text and text-to-speech tools assist those with disabilities. AI-powered apps translate languages and recognize images for the visually impaired. Social inclusion via better access to services and information for the underprivileged. Specific example: Microsoft’s Seeing AI app describes the world to blind users.

8. Scientific Discovery. AI accelerates drug discovery, materials science, and space exploration. It can analyze massive data sets faster than any human team. Specific example: DeepMind’s AlphaFold solved a 50-year-old problem in biology by predicting protein structures.

To summarize, AI benefits mankind through faster, more accurate diagnosis and treatment in healthcare; safer roads and optimized logistics in transportation; personalized learning and automated support in education; increased productivity and new job opportunities in the economy; climate modeling and sustainable agriculture in the environment; early warnings and emergency response tools in public safety; assistive tech for people with disabilities and accelerated discovery in medicine, space, and more

(To be continued.)

 

Bernardo M. Villegas has a Ph.D. in Economics from Harvard, is professor emeritus at the University of Asia and the Pacific, and a visiting professor at the IESE Business School in Barcelona, Spain. He was a member of the 1986 Constitutional Commission.

bernardo.villegas@uap.asia

Increased life, nonlife insurance coverage to boost PHL economic output

STOCK PHOTO | Image by Jakub Żerdzicki from Unsplash

INCREASING insurance protection can boost Philippine gross domestic product (GDP) by at least 2.9% by 2050 as it can improve human capital, working conditions, and climate resilience, a study by Prudential plc showed.

The study titled “Beyond Coverage – The Social and Economic Impact of Insurance in ASEAN” done by Prudential in partnership with PwC showed that higher life and nonlife insurance uptake can increase both GDP and GDP per capita and has a positive impact on sustainable development.

“Insurance is a powerful catalyst for sustainable growth across ASEAN (Association of Southeast Asian Nations), underpinning the region’s journey toward resilience and prosperity. By delivering essential risk protection and fostering financial stability, insurers lay the groundwork for communities to flourish,” Prudential Group Chief Investment Officer Neil Moge said.

“Moreover, the industry’s ability to direct long-term capital into critical sectors, such as infrastructure and green energy, fuels economic advancement and social well-being. The continued expansion of insurance throughout ASEAN opens new horizons of opportunity, empowers inclusive development, and enables the entire region to thrive.”

Based on the study, increasing nonlife insurance premiums, including health insurance, by 50% by 2050 can boost Philippine GDP by 2.9% to $1.959 trillion from the $1.904 trillion baseline estimate for that year and GDP per capita to $12,407 from the $12,058 baseline.

A 100% and 200% growth in nonlife insurance protection can yield boosts of 5.9% and 12%, respectively.

Meanwhile, a 50% growth in life insurance coverage by 2050 can give both GDP and GDP per capita a 5.1% boost that year, while premium increases of 100% and 200% will result in bumps of 10.3% and 21.4%, respectively.

These are largely in line with the projected increases for the other ASEAN countries included in the study, which are Indonesia, Malaysia, Singapore, Thailand, and Vietnam. According to Prudential, these countries and the Philippines represent 99% of premiums in the ASEAN insurance market, although penetration rates vary across these economies.

Prudential said the study highlights that insurance is more than just a financial safety net as it can help advance social development by promoting access to healthcare protection, improving workforce productivity, and addressing adverse climate change effects.

Insurance is also closely related to labor force participation, capital deepening, and human capital, which are among the five key factors that determine economic output under the World Bank’s Long-Term Growth Model, it said.

“In ASEAN’s dynamic economies, insurance is a strategic tool that can benefit individuals, businesses and governments. For businesses, the right insurance coverage stabilizes operations and the workforce. Companies with insurance can better manage risks and withstand market shocks, avoiding losses that would otherwise disrupt supply chains and jobs. At the community and government level, broader insurance coverage means fewer people falling into poverty after a setback and less strain on public funds,” Prudential said.

“By reducing the financial risks that disproportionately affect low-income and vulnerable groups, insurance helps narrow inequalities and build more resilient communities. There is clear evidence that expanding insurance yields tangible economic benefits… In practical terms, when more people are protected, more people can work and invest in their skills; when businesses and individuals feel secure, they are more likely to invest in assets or education for the future.”

Countries can tap the economic growth benefits of insurance by implementing various initiatives and reforms like fiscal incentives, strengthening the sector through public-private partnerships, and improving the insurance ecosystem to make coverage more affordable and accessible, Prudential said.

“ASEAN’s evolving risks and demographics necessitate fresh resilience strategies that link risk, investment, growth and protection. The insurance industry has the potential to drive significant change by creating innovative and inclusive insurance models and products, particularly for vulnerable and low-income communities with limited resources. Insurance can provide these communities with the necessary tools to recover from crises while enhancing their financial health and resilience over time.”

The Philippine insurance industry recorded higher premiums as of June, pushing up the country’s insurance penetration rate.

Total premiums paid for life and nonlife insurance products grew by 12.98% to P242.842 billion at end-June from P214.941 billion in the same period last year, data from the Insurance Commission showed.

As a result, insurance penetration, or the ratio of insurance premiums to the gross domestic product, rose to 1.79% from 1.71% a year prior.

Insurance density, or the average spending of each individual on insurance, also increased by 12.07% to P2,137.32. — BVR

Lodestar stockholders approve digital asset venture, capital hike

STOCK PHOTO | Image by Jonathan Francisca from Unsplash

LISTED Lodestar Investment Holdings Corp. said on Tuesday that its stockholders had approved amendments to its articles of incorporation to allow investments in digital assets and to raise its authorized capital stock to P3 billion.

In a disclosure to the exchange, the company said shareholders ratified the board’s earlier decision to revise its primary purpose clause to include investing in and dealing with digital assets, while excluding activities as a crypto asset service provider or virtual asset service provider.

The stockholders also approved a tenfold increase in the company’s authorized capital stock to P3 billion from P300 million, by raising the number of shares to 30 billion from three billion, with a par value of P0.10 apiece.

The company said the capital hike would give it flexibility to issue new shares in the future since its current authorized capital is already fully subscribed.

It noted, however, that “the persons who will subscribe to the shares to be issued out of such increase in authorized capital stock are not yet identified as of this time.”

The amendments will take effect once cleared by the Securities and Exchange Commission, the company added.

Formerly Lodestar Mining Corp., the company was incorporated in 1974 and shifted to an investment holding company in 2003.

At the local bourse on Tuesday, Lodestar shares rose by 2.94% to close at P0.70 each. — Alexandria Grace C. Magno

Disney says Kimmel will return to the air on Tuesday, six days after suspension

Jimmy Kimmel in Jimmy Kimmel Live! (2003)

LOS ANGELES — Disney said on Monday it would return comedian Jimmy Kimmel to late-night television on Tuesday, six days after his show was threatened with a regulatory probe and suspended over comments he made about conservative activist Charlie Kirk’s assassination.

Disney’s move to restore the Jimmy Kimmel Live show to the lineup of its ABC network represented the highest-profile challenge yet from a communications company to an escalating crackdown by US President Donald Trump on his perceived media critics through litigation and warnings regulatory action.

The U-turn came after several prominent conservatives, including US Senator Ted Cruz, a Texas Republican who leads oversight of the Federal Communications Commission (FCC), joined Democrats in criticizing the head of the FCC for threatening retaliation against ABC.

Disney also faced pressure from consumers rallying against Mr. Kimmel’s suspension by canceling their subscriptions to the Disney+ streaming subscription service.

Mr. Kimmel, who has frequently ridiculed Trump on his show, drew outrage from conservatives for saying that Mr. Trump’s supporters were desperate to characterize Mr. Kirk’s accused assassin “as anything other than one of them” and for trying to “score political points” from his murder.

The comments came in the opening monologue of Mr. Kimmel’s Monday night broadcast, five days after Mr. Kirk, an influential Trump ally, author and radio-podcast host, was shot dead while speaking on the campus of Utah Valley University in Orem.

‘ILL-TIMED’ COMMENTS
In the wake of threats of investigation, fines, and broadcast license revocations from FCC Chairman Brendan Carr, and a boycott by many of ABC’s affiliate stations, Disney said last Wednesday it was shutting down production of Mr. Kimmel’s program indefinitely.

In announcing Mr. Kimmel’s return on Tuesday, Disney said it had initially suspended the show “to avoid further inflaming a tense situation at an emotional moment for our country.”

Disney added that it found Mr. Kimmel’s comments about Mr. Kirk “were ill-timed and thus insensitive,” but the entertainment giant stopped short of an outright apology.

Disney CEO Bob Iger and Disney Entertainment Co-Chair Dana Walden spoke with Mr. Kimmel over the weekend and reached a decision on Monday to return Mr. Kimmel to the air, according to two people familiar with the matter. The decision was guided by what was in the entertainment company’s best interest, rather than external pressure from station owners or the FCC, the sources said.

Another source at the company said Disney was feeling pressure from a campaign urging consumers to cancel their Disney+ subscriptions in protest. Google searches for “how to cancel Disney+” spiked to a 12-month high, according to Google Trends.

Mr. Kimmel is expected to address the issue when his show returns on Tuesday, according the sources. It was not known whether the late-night host planned to apologize or would be required to restrict or tone down any of his commentary.

A spokeswoman for Mr. Kimmel could not immediately be reached for comment.

Also left unclear was whether ABC’s two biggest affiliate television groups, Nextstar Media Group and Sinclair, Inc., would eventually agree to resume carrying the show once it returned to the network.

There was no immediate comment from Nextstar which needs FCC approval for a $6.2 billion merger with Tegna. Sinclair said it would continue preempting Mr. Kimmel’s time slot on Tuesday with news programming while conducting talks with ABC “as we evaluate the show’s potential return.”

BUSINESS VS FREE SPEECH
Disney’s reversal was likely based on business considerations rather than the desire to uphold free speech rights, as enshrined in the First Amendment of the US Constitution, said Susan Campbell, a media studies professor at the University of New Haven in Connecticut.

“Consumers were exercising their own First Amendment rights and ending their subscriptions to the company’s streaming services,” Ms. Campbell said.

In a message posted to X, Andrew Kolvet, a spokesperson for Mr. Kirk’s conservative youth organization Turning Point USA, accused Disney and ABC of “caving” to public pressure, adding, “but it’s their mistake to make.”

FCC Commissioner Anna Gomez, the lone Democrat on the panel, praised Disney for “its courage in the face of clear government intimidation.”

Mr. Trump, who has repeatedly pressured broadcasters to stop airing content that he has found objectionable, had celebrated the news of Mr. Kimmel’s suspension last week and referred to it erroneously as an outright cancellation of the show.

In comments last week to reporters aboard Air Force One, the president raised the prospect of revoking FCC licenses as punishment for what he regarded as unfair treatment of him by broadcasters, saying, “It will be up to Brendan Carr.”

Mr. Kimmel became the most prominent public figure embroiled in efforts by Mr. Trump to punish critics of Mr. Kirk in the aftermath of his slaying even as his assassination was universally condemned across the ideological spectrum as a barbaric act of political violence.

A 22-year-old technical school student from Utah has been charged with Mr. Kirk’s murder. The precise motive for the killing remains unclear.

In response to Mr. Kimmel’s comment about the case last Monday, Mr. Carr urged local broadcasters to stop airing the late-night show and suggested the commission could open an investigation leading to potential fines or broadcast license suspensions of local stations if a pattern of news distortion was found.

“This is a very, very serious issue right now for Disney. We can do this the easy way or the hard way,” Mr. Carr said in a podcast interview that aired on Wednesday. His remarks drew criticism from across the political spectrum.

Earlier on Monday, Mr. Carr insisted that Disney’s decision to yank Mr. Kimmel from the air was a business one, not the result of government action. “Jimmy Kimmel is in the situation that he is in because of his ratings,” Mr. Carr said at a forum before Mr. Kimmel was reinstated.

Disney shares, which fell in trading last week, closed down 1% on Monday. — Reuters

Europe and the Indo-Pacific: Affinities and shared challenges

REAR ADMIRAL Guillaume Pinget, commander of the French Armed Forces in French Polynesia, delivered the keynote message, highlighting France’s commitment to strengthening cross-regional cooperation in the Indo-Pacific. — FACEBOOK.COM/FRENCHEMBASSYPH

Over the past two years, there have been high-level visits to the Philippines by European leaders.

European Commission President Ursula von der Leyen visited in July 2023 to strengthen strategic cooperation and trade relations. German Defense Minister Boris Pistorius visited in August 2024 to discuss defense collaboration, cybersecurity initiatives, and ways to enhance military interoperability. In September 2024, the Stratbase Institute hosted a roundtable discussion as part of the official visit of Polish Foreign Minister Radosław Sikorski.

These visits are backed by concrete defense agreements. In May 2025, Germany and the Philippines signed a defense cooperation agreement to expand collaboration on cybersecurity, military logistics, defense armament, and UN peacekeeping operations. Negotiations are also ongoing for a Visiting Forces Agreement with France.

These steps reflect Europe’s growing recognition that its security is inseparable from the Indo-Pacific’s. Indeed, both regions share strong security and economic ties, fortified by common challenges and interests.

Beyond security, both Europe and the Indo-Pacific are vital engines of global trade and innovation. The European Union, with its deeply integrated single market of 27 member states, stands as one of the world’s largest economic blocs. According to April 2025 projections from the International Monetary Fund, the EU’s nominal GDP is expected to reach nearly $20 trillion — second only to the United States. Meanwhile, the Indo-Pacific generates 60% of global GDP and contributes two-thirds of global economic growth, based on the European Union’s Strategy for Cooperation in the Indo-Pacific.

These economic strengths are complementary. Cross-regional cooperation is not only strategic but mutually beneficial, deepening interdependence, advancing innovation, and reinforcing resilience amid today’s geopolitical uncertainties.

But interdependence also means shared exposure to external shocks. Both regions now operate in a volatile geopolitical environment marked by grey-zone tactics, cyber intrusions, and strategic coercion. Tensions in the West Philippine Sea show how localized disputes can trigger global ripple effects: any disruption here would directly impact European economies, just as instability in Europe would reverberate across the Indo-Pacific.

Disinformation campaigns exploit vulnerabilities across borders. Critical infrastructure — from undersea cables to maritime chokepoints — is increasingly at risk.

These shared risks demand urgent responses.

It is in this spirit that the Stratbase Institute, in partnership with the European Council on Foreign Relations, convened experts and policymakers from both regions to strengthen joint responses, foster greater trust, and enhance situational awareness in theaters shaped by asymmetric threats.

Held on Sept. 18, the forum, called “Navigating Asymmetric Threats: Cross-Regional Strategies for Europe and the Indo-Pacific,” took place in Makati City.

“This is a very fruitful moment… to have this conversation, to share common experiences, to understand the nature of the threat environment, and to come up with best practices,” said James Crabtree, Distinguished Visiting Fellow of the European Council on Foreign Relations, who gave the opening remarks.

Keynote messages were delivered by RADM Guillaume Pinget, Commander of the French Armed Forces in the Pacific, and by Secretary Eduardo Año, National Security Adviser and Director General of the National Security Council.

“We are committed to defending an open, secure, and inclusive area, free from all forms of coercion, and based on respect for international law, multilateralism, and national sovereignty. In this context, the French Armed Forces are doing their part… by being involved and committed in facing asymmetric threats in the Indo-Pacific,” said Mr. Pinget.

Mr. Año said: “Cross-regional strategies should not be about exclusion or confrontation. Instead, they should be about providing alternatives — credible choices in trade, development, infrastructure and security — while ensuring that no country is left with only one coercive dependency.”

Four panel discussions tackled key economic and security issues. The first panel addressed the new security environment in the Indo-Pacific, given the unprecedented uncertainty occasioned by the second administration of United States President Donald Trump.

The second examined how authoritarian powers are weaponizing legal ambiguity to challenge the rules-based order. The third looked at how undersea cables, forming the backbone of communication, remain exposed to sabotage. The fourth explored how emerging technologies are reshaping asymmetric conflict.

The conversations continue.

Yesterday, Stratbase, in partnership with the Embassy of Ukraine in the Philippines, hosted the forum “Strengthening Strategic Ties: Enhancing Cooperation between the Philippines and Ukraine.” The event marked the official visit of a Ukrainian delegation composed of Members of Parliament and leading analysts. It brought together government officials, scholars, and experts from both countries to deepen dialogue, explore shared challenges in maritime security, and build pathways for bilateral cooperation in a changing global landscape.

This engagement with Ukraine underscores how the security interests of Europe and the Indo-Pacific increasingly intersect — and how values such as sovereignty, international law, and strategic resilience are not regional concerns, but global imperatives.

The future of peace, stability, and prosperity will depend on sustained Europe-Indo-Pacific collaboration. The challenges are daunting. But while there are risks, there are also opportunities for cooperation and mutual reinforcement.

The nations and peoples of Europe and the Indo-Pacific share more than one might imagine. We may be halfway across the world from each other, but changing times have narrowed the gaps and intertwined our futures.

By uniting shared values, resources, and expertise, both regions can set the standard for effective multilateral engagement, uphold sovereignty and freedom of navigation, and address complex security challenges in an interconnected world.

Confronting our threats means strengthening resilience, safeguarding critical infrastructure, and upholding the rules-based international order.

 

Victor Andres “Dindo” C. Manhit is the president of the Stratbase ADR Institute.

BSP’s net income drops by 17.8% in the first half

BW FILE PHOTO

THE BANGKO SENTRAL ng Pilipinas’ (BSP) net profit dropped by 17.8% in the first half due to lower revenues.

The central bank’s net income declined to P70.3 billion in the first semester from P85.5 billion in the same period a year ago, based on its income statement posted on its website.

This came as its revenues went down by 14.7% to P140 billion in the period from P164.1 billion a year ago.

Broken down, interest income, which accounted for the bulk of the BSP’s revenues, edged up by 0.9% year on year to P120.9 billion from P119.8 billion.

Miscellaneous earnings, which are made up of fees, penalties and other operating income, slumped by 56.8% to P19.1 billion from P44.3 billion the prior year.

Meanwhile, the BSP’s expenses dropped by 2.6% to P103.4 billion in the first semester from P106.1 billion a year earlier.

Broken down, interest expenses fell by 17% year on year to P70 billion from P84.3 billion, while other expenses, which include net trading losses, climbed by 53.1% to P33.4 billion from P21.8 billion.

This brought the central bank’s net income before foreign exchange (FX) gains or losses, income tax expenses, and capital reserves to P36.7 billion in the first half, declining by 36.7% year on year from P57.95 billion.

However, the BSP’s bottom line was boosted by a P33.7-billion net FX gain realized from its foreign currency-denominated transactions in the period, which was 22.2% higher than the P27.6 billion seen a year prior.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the BSP’s profitability in the period may have been brought down by base effects.

“This could be partly due to higher base effects given the sharp increase in income in recent years,” he said in a Viber message.

“Any adjustments may be attributed to fulfilling its price stability and financial stability mandate.”

Meanwhile, Reinielle Matt M. Erece, an economist at Oikonomia Advisory & Research, Inc., attributed the central bank’s lower income in the period to the maturity of its issued securities.

“This is as the BSP will have to repay these T-bills and bonds from investors and bondholders,” he said in a Viber message.

“Further, the dip in BSP’s assets can be traced to these debt repayments, which caused the central bank’s reserves to fall. We may expect the same trend further as the debt service bill continues to increase.”

Separate data showed that the BSP’s total assets declined by 2.3% to P7.69 trillion at end-June from P7.87 trillion in the same period in 2024.

Its international reserves, which made up most of its assets, went down by 3.1% year on year to P5.93 trillion from P6.12 trillion.

Its holdings of domestic securities also dropped to P1.1 trillion from P1.16 trillion.

On the other hand, the central bank’s liabilities declined by 3.6% to P7.39 trillion as of June from P7.67 trillion a year earlier.

Currency in circulation stood at P2.52 trillion, while deposits with the central bank were at P2.31 trillion.

Meanwhile, the BSP’s net worth went up by 46.2% to P303.6 billion at end-June from P207.7 billion from a year prior.

Its surplus or reserves — which include its unrestricted retained earnings, capital reserves, unrealized gains or losses on investments in securities and stocks, and net income or loss from its operations — reached P243.6 billion, up from P147.7 billion a year prior. — Katherine K. Chan

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