Home Blog Page 3241

Moody’s affirms ratings, outlooks for BPI and Metrobank

REUTERS

MOODY’S RATINGS has affirmed its ratings and outlooks for Bank of the Philippine Islands (BPI) and Metropolitan Bank & Trust Co. (Metrobank) on expectations of stable profitability.

“The affirmation of BPI’s and MBT’s Baa2 ratings and baa2 Baseline Credit Assessments (BCA) reflects the banks’ strong funding and liquidity supported by leading domestic franchises, as well as Moody’s expectations that their asset quality and profitability will remain stable,” the credit rater said in a statement on Wednesday.

It also kept its stable rating outlooks on the banks.

The debt watcher said the two lenders have ample capital to cushion risks arising from their expansion into the higher-risk retail lending segments.

Both BPI and Metrobank’s nonperforming loan ratios are expected to remain stable at around 2.1% and 1.7%, respectively, driven by improvements in their commercial and mortgage loan books.

Moody’s Ratings also sees BPI’s consumer loans to grow at a faster pace compared to Metrobank, with both banks expected to have steady net interest margins as rates are expected to remain higher for longer.

Meanwhile, provisioning costs will remain low amid stabilizing asset quality and loan loss coverage accumulated over the pandemic.

The credit rater said both lenders’ return on assets (ROA) are likely to remain stable, with BPI’s ROA in 2024 to be higher at 1.7% compared with Metrobank’s 1.4% as the former has more consumer loans in its portfolio.

However, Moody’s Ratings said Metrobank’s capital ratio will slightly decline as loan growth accelerates, while BPI’s will remain stable.

“Both banks’ capital ratios will hover at a strong level of around 15% over the next 12-18 months,” it said.

The two banks could see a modest increase in reliance on market funds, similar to pre-pandemic levels, while deposits will continue to be mostly funded by low-cost current account, savings account or CASA deposits.

BPI and Metrobank are seen to remain adequately liquid despite faster loan growth in the next 12-18 months as both banks ended 2023 with strong liquidity coverage ratios (LCR).

Metrobank’s LCR was better at 270% versus BPI’s 207%, Moody’s Ratings said.

It added that both lenders will likely get support from the government due to their large market shares in terms of total assets, which is at 11.5% for BPI and 12.3% for Metrobank.

Moody’s Ratings said both banks are unlikely to see upgrades to their BCAs and ratings given the debt watcher’s stable outlook on the sovereign.

However, a downgrade in sovereign rating or a significant increase in party lending will result in the lenders’ BCAs and long-term ratings.

“Moody’s could lower the banks’ BCAs if there is a significant deterioration in their solvency metrics, where their problem loan ratios rise above 3% and Moody’s-adjusted tangible common equity/risk-weighted assets ratios decrease to below 12%,” the debt watcher said. — Aaron Michael C. Sy

Dining In/Out (05/16/24)


Happy hours at Newport World Resorts

OVER at Newport World Resorts, it is happy hour at The Whisky Library from 5 to 8 p.m, during which time guests can explore an array of cocktails and fine whiskies and spirits of worldwide origin. For P1,200 net per person, customers choose from over 40 drink options that come with a serving of the bar’s signature tapas. The Whisky Library’s Happy Hour bar list includes gin (Bombay Sapphire, Citadelle, Sirena Blue, Malfy, Roku), rum (Bacardi Premium Black, Plantation O.F.T.D. 69%, Plantation Pineapple), tequila (Montezuma Aztec Gold, Olmeca Reposado), brandy (Fundador Imperial), vodka (Ketel One, Tito’s Handmade), whisky and whiskey (if it’s not Scotch, the extra “e” is added; anyway, they have Benchmark No. 8, Jack Daniel’s, Canadian Club, Ballantine’s Finest, Dewar’s Caribbean Smooth 8 Years, Dewar’s Japanese Smooth 8 Years, Dewar’s Portuguese Smooth 8 Years, Johnnie Walker Red, Jameson, Teeling Single Grain, Tullamore Dew), single malts (Paul John Bold, Paul John Brilliance, Penderyn Legend, Bushmills 10 Years, Cotswolds), and liqueurs (Amarula, Jägermeister, and Southern Comfort). These may be ordered neat, on the rocks, or with mixers. Classic cocktails — Mojito, Piña Colada, Martini, Whisky Sour, and Margarita — are also on the list. One can also try The Whisky Library’s signature cocktails like Life is Like and In the Moment. Rounding out the list are beers (San Mig Light, San Miguel Pale Pilsen) and wines (red or white). Meanwhile, The Woodsman Blended Scotch Whisky experts will take over Newport’s The Grand Bar and Lounge to serve drinks featuring the whisky. This will happen on May 22, from 6 to 9 p.m. Seats at the bar go for P1,200, which gets one 60 minutes of drinks and stories about Woodsman whisky. Dean Rosen, the Whyte & Mackay Single Malt Expert for Asia, leads the experience along with Emperador Distillers’ Cocktail Craftsmen Gerry Elle II and Christian John Ducusin. For more information on new offers from Newport World Resorts, visit www.newportworldresorts.com and follow @newportworldresorts on Facebook and Instagram, and @nwresorts on Twitter.


Happy Living marks 30th anniversary with wine festival

HAPPY LIVING celebrates its 30th anniversary with “A Continuing Journey Across the World’s Most Famous Wine Regions and Wineries,” a wine festival featuring over 150 celebrated wines, beers, and spirits from all over the globe. This event will take place on June 15 at The Tent at Enderun, McKinley Hill, Taguig. Happy Living’s wine festival features masterclasses with partner brands Jackson Family Wines of Sta. Rosa, California, Lionel Osmin & Cie and Chteau Croix de Labrie of France, and Lolea Mediterranean Apéritif from Spain. Wine festival participants also get the chance to bring home raffle prizes, including boxes of Loire Valley white wines or the Burgundy Experience set of reds, a complimentary overnight stay at Acro Residences, and even a European designer chair from Edia. Tickets cost P2,500 until June 15, but Early Bird rates set at P1,500 are available until May 31. Tickets are now on sale at Happy Living website’s Shop page (www.tinyurl.com/HLPC30TH-ANNIVTIX).


NUSTAR holds Food and Wine Festival 2024

THE GRAND opening weekend at NUSTAR Resort and Casino on June 1 and 2, will celebrate Cebu’s best through 15 tasting stations, three award-winning chefs, and over 50 varieties of wines and spirits through Taste Cebu: Food and Wine Festival 2024. The event will have three tasting zones at The Grand Ballroom, each zone reflective of Cebu: Wave, Warmth, and Peak. Tickets (ranging in price from P2,060 to P3,605, plus a 3% service fee) are available at https://premier.ticketworld.com.ph/.


Chowking’s Braised Beef is back

CHOWKING’s Braised Beef, absent from menus since 2014, is making a delicious return after 10 years. The dish was a favorite of many then, simmered in a savory sauce with carrots and greens, served atop rice. As per Chowking’s statement, the item’s return can be credited to the power of the internet. “It all started when content creator Eatsplorations reminisced about the dish on their account, sparking a wave of online requests. Chowking, noticing the outpouring of love, then reposted the content and hinted at good things to come. A few days later, Chowking confirmed the comeback of the dish with more goodness bringing back nostalgia in every bite as shared by content creator, MarkyBap (@markybap).” The dish is now available at Chowking branches or order online at www.chowkingdelivery.com.


Cooling things down with McCafé Iced Coffee

MCDONALD’S is unveiling new McCafé Summer Brews: McCafé Cereal Milk and Toasted Coconut Iced Coffees. The new flavors will be hitting McDonald’s stores nationwide. McCafé Toasted Coconut features hints of coconut, while McCafé Cereal Milk combines the kick of chilled coffee with the taste of milk left behind after finishing a bowl of cereal. Each McCafé Summer Brews flavor will be available in three varieties: aside from iced coffee, there will be options for coffee floats (with soft-serve ice cream on top) and iced lattes (espresso and whipped cream). From May 14 to 20, new and existing McDonald’s App users can enjoy discounted McCafé Summer Brew deals with Cereal Milk or Toasted Coconut Iced Coffee for P65, or a McCafé Summer Brews Coffee Float for P75, redeemable via dine-in, take-out, or drive-through.

AREIT sees boost in Q1 income from acquisitions

AREIT, Inc. saw a 45% surge in its first-quarter (Q1) net income to P1.47 billion, attributed to its asset acquisitions.

“AREIT’s first-quarter income was boosted by acquisitions which included the new One Ayala Avenue East and West Office Towers, Glorietta 1 and 2 Mall and Office buildings at Ayala Center Makati, MarQuee Mall in Pampanga and the Seda Hotel in Lio, El Nido,” the company said in a statement to the stock exchange on Wednesday.

AREIT is the real estate investment trust of listed property developer Ayala Land, Inc. (ALI).

First-quarter revenue rose by 43% to P2.11 billion, while earnings before interest, taxes, depreciation, and amortization increased by 45% to P1.51 billion.

The company has P88.6 billion worth of assets under management (AUM) consisting of malls, offices, hotels, and industrial land. Its overall occupancy rate stood at 96%.

On March 19, AREIT executed a deed of exchange with ALI and its subsidiaries, Greenhaven Property Ventures, Inc. and Cebu Insular Hotel Co., Inc., and Buendia Christiana Holdings Corp., involving the issuance of 841,259,412 primary common shares at P34 per share in exchange for P28.6 billion worth of assets.

The assets are Ayala Triangle Gardens Tower Two, Greenbelt 3 and 5, Holiday Inn in Ayala Center Makati and Seda Ayala Center Cebu, and the 276-hectare land in Zambales for solar power plant operations.

Once approved by regulators, AREIT’s AUM will reach P117 billion, quadruple the size since its initial public offering in August 2020.

AREIT shares rose by 0.15% or five centavos to P33.95 apiece on Wednesday. — Revin Mikhael D. Ochave

Security Bank sees net earnings rise by 11.4% in the first quarter

SECURITY BANK/BW FILE PHOTO

SECURITY Bank Corp. (Security Bank) saw its net income increase by 11.4% in the first quarter on growth across its retail, wholesale and micro, small, and medium enterprise (MSME) businesses.

The bank’s net profit stood at P2.63 billion at end-March, up from P2.36 billion in the same period last year, its financial statement disclosed to the stock exchange on Wednesday showed.

“Our results for the first quarter reflect accelerating momentum across our retail, MSME, and wholesale segments,” Security Bank President and Chief Executive Officer Sanjiv Vohra said in a statement.

The bank’s first-quarter performance translated to a return on shareholders’ equity of 7.71%, up from 7.42% a year ago, while return on assets was at 1.2%, up from 1.15%.

Total revenues increased by 27% to P12.5 billion in the first quarter.

Net interest income rose by 43.93% year on year to P10.73 billion from P7.45 billion on the back of higher interest income from loans amid a high rate environment.

Its net interest margin stood at 5.32%.

Meanwhile, Security Bank’s non-interest income stood at P1.8 billion, mainly driven by growth in its earnings from service charges and fees and commissions to P3.1 billion from P1.31 billion.

“Excluding extraordinary items on both revenue and expense, which offset each other, normalized net income would be largely unchanged,” it said.

Pre-provision operating profit increased by 34% to P4.9 billion.

As a result, the bank’s total operating income grew by 27.36% year on year to P12.48 billion as of March from P9.8 billion.

Meanwhile, operating expenses increased by 35.21% to P9.11 billion in the first quarter from P6.74 billion amid sustained investments in manpower and technology to accelerate its transformation, Security Bank said.

This led to a cost-to-income ratio of 60.74%, lower than the 62.55% a year ago.

Net loans increased by 12% year on year to P545.29 billion as of March, driven by retail and MSME loans, which rose by 32% year on year. Wholesale loans also climbed by 4%.

“The growth in retail and MSME loans was driven by home loans which increased 18% year-on-year, auto loans which rose 46%, credit cards which grew 49%, and MSME loans which grew 74%,” Security Bank said.

The lender set aside P1.5 billion in provisions for credit losses in the quarter.

Its gross nonperforming loan (NPL) ratio stood at 3.4%, while NPL reserve cover was at 81%.

On the funding side, total deposits rose by 22% year on year to P638 billion as the bank’s low-cost current and savings account or CASA deposits increased by 6%, making up 56% of the total.

Its loan-to-deposit ratio stood at 85.42% as of March.

Security Bank’s total assets grew by 1.8% to P887.18 billion at end-March from P871.51 billion at end-2023 and also up by 12% year on year. Total equity inched up by 0.33% to P136.57 billion from P136.13 billion the quarter prior, also rising by 6% from the previous year.

Its common equity Tier 1 ratio was at 14.4%, while its total capital adequacy ratio stood at 15.25%. The bank also recorded a liquidity coverage ratio of 184% and a net stable funding ratio of 131%.

Security Bank’s shares closed unchanged at P70.50 apiece on Wednesday. — A.M.C. Sy

In praise of almonds and nuts

MOCKUPO-UNSPLASH

THEY’RE known as “oily fruits.” Because of their numerous health benefits, notwithstanding their high fat content, almonds, hazelnuts, and other nuts are among foods recommended for consumption in Canada, the US, France, and across the European Union — to the tune of a small handful each day.

From a nutritional standpoint, these hard-shelled fruits are distinguished by high levels (50-75%) of unsaturated fats (which are seen as “good fats”), significant protein content (10-25%), plus minerals (sodium, magnesium, potassium), vitamins B3, B9, B6, and E, fiber, antioxidants, and vegetable oils. A stack of data suggests that they could help us age well and protect us from a range of chronic conditions.

STRIPPING OUT ‘BAD’ CHOLESTEROL
If there’s one area where shelled fruits have proved their worth, it’s bringing cholesterol down. Reducing the amount of animal fat in your diet and eating fiber are, for certain, effective ways to cut levels of LDL-cholesterol, that’s to say “bad cholesterol.” But many studies have also shown the benefits of a daily handful of almonds. The same seems true of all nuts.

In 2010, a study of the collected data over the course of 25 clinical trials involving men and women with high cholesterol showed that eating 67 gm of nuts every day for three to eight weeks could cut LDL-C levels by 7.4%, with more sizeable effects than this on symptoms since the patients were over healthy limits previously.

Another systematic data review confirmed this, albeit at a more modest rate. Carried out in 2018, it analyzed results from 26 clinical trials: the authors in this case detected a 3.7% fall in LDL-C levels for a diet rich in shelled fruits (15-108 gm per day) over a period of one to 12 months. It’s known that lowering LDL-C levels is linked to a reduction in total mortality and in deaths from cardiovascular disease, particularly if levels were high to start with. Even if no clinical study has yet shown that eating nuts can reduce the risk of heart failure, there’s no shortage of arguments to support such a hypothesis.

LOWER RISK OF CARDIOVASCULAR DISEASE
First one might point to the results of a meta-analysis published in 2019. Applying the criteria used by Canada’s Cochrane Center, the authors chose 19 studies, and evaluated that a 28-gm daily portion of shelled fruits is associated with a 13% fall in cardiovascular disease, and 29% in deaths from heart disease.

You could also refer to a huge randomized and controlled study across many different locations on the role of a Mediterranean diet enriched with nuts in reducing the risk of heart disease. Participants in this, aged 55-80 and registering a significant risk of heart, were assigned one of three diets — low-fat, a Mediterranean diet rich in olive oil, and a Mediterranean diet with added nuts. They were tracked for almost five years on average. At the end of the research, it was shown that heart problems were less frequent among the two groups following the Mediterranean diet.

FAT THAT DOESN’T MAKE YOU PUT ON WEIGHT
On the energy side, 30 gm of almonds, peanuts, pistachios, or cashews work out as a 180-calorie snack; the same quantity of pecans or Brazil nuts come to 220-230 calories. These figures are roughly equivalent to 30-40 gm of milk chocolate. Since the calorific content is essentially made up of fats, one might be given to think one must beware of “oily fruits” if weight-watching. But that assumption would be wrong…

In fact, a recent piece of research closely analyzed six cohort studies and 62 randomized diet tests. This concluded that regularly eating nuts for a longer or shorter period of time (between three and 336 weeks) is linked to very slight weight loss (an average of 200 gm) and a shrinking waistline (by an average of 0.5cm).

If the reasons for these counter-intuitive outcomes haven’t been adequately explained yet, various theories can be put forward. For one, there is the matrix that encases the oils in nuts limits, to an extent, their absorption in the gut. To put it simply — some of the fat content in nuts is eliminated in the body’s cells, rather than being absorbed. Meanwhile, thanks to how they blunt our appetite, almonds and other nuts reduce the amount we eat at meals, so much so that our overall calorie count is no greater, or perhaps less than it would have been without them.

DO NUTS HAVE ANTI-CANCER PROPERTIES?
Other benefits are attributed to shelled fruits — notably around cancer prevention, although the evidence for this is weak. The relevant studies rely on observations alone, and suffer from various interpretation biases.

According to an analysis of 33 studies published before June 2019, increased consumption of nuts is demonstrably linked to a 10% fall in cancer risk; and the effect is more marked for cancers of the digestive system, with a risk reduction of 17%.

Nuts’ high antioxidant content might be one of the drivers for this. But before exploring this hypothesis further, we need to check the observed data with verifiable controlled and randomized clinical trials. For the moment, there’s nothing that allows us to say that eating nuts protects against cancer.

FEWER NEURODEGENERATIVE CONDITIONS
Oils and fats are vital for the brain. After fat tissue, it’s the organ in the body richest in lipids: they can be found in the neuron membranes and related cells, but also in the myelin which speeds up the transmission of electrical impulses through the nervous system.

Several research teams have set out to evaluate the benefits of nuts for the central nervous system. What have they learned?

Their notable discovery was that after a few weeks of a diet more or less rich in nuts, 19-month-old rats performed better on psychometric tests. A diet of 2% nuts boosted their performance on a rod-clambering test, one of 6% nuts saw them do better on a plank-walking test, and at both these levels their powers of short-term memory were heightened. These results have been confirmed by a study of shorter duration, with a marked improvement detectable in the rodents’ learning and memory.

As for humans, a study of the PREDIMED diet intervention has shown that a Mediterranean diet rich in nuts improves short-term memory. It has also offered evidence, at a biological level, of a reduced risk of low BDNF plasma — a protein which helps the growth and vigor of new neurons. Nuts seem to have a beneficial role in warding off age-related cognitive decline. However, we don’t have direct proof that if one regularly eats nuts, it reduces the risk of neurodegenerative diseases.

To sum up: nuts appear at first glance to have all the features allowing them to be considered allies of our health. While they are calorie-rich and high in fats, a 30-gm serving per day seems to cut “bad cholesterol” and protect us from cardiovascular disease, without affecting our weight. There are plenty of theories that suggest they have a positive impact, both on other illnesses and warding off cognitive decline associated with age.

Plenty of good reasons to recommend everyone to include a handful of almonds, hazelnuts, or other nuts in the food they eat each day — obviously without added sugar or salt!

(Translation from French into English by Joshua Neicho.)

 

Dr. Boris Hansel is a university professor – hospital practitioner at the French National Institute of Health and Medical Research (Inserm), and in the Faculty of Health at the Paris Cité University. Diana Kadouch is a hospital practitioner at the Bichat Hospital, in the Diabetology-Nutrition Department, AP-HP, and a Lecturer in the Nutrition department, Paris Cité University. Jérémy Puyraimond-Zemmour is an assistant specialist in the Diabetology-Nutrition Department of Bichat Hospital, AP-HP, and a lecturer in the Nutrition department, Paris Cité University.

Shang Properties, Inc. to hold Annual Meeting of Stockholders on June 18

 

 


Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Web site. For more information, send an email to online@bworldonline.com.

Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.

Gayle King, Kate Upton model for 60th Sports Illustrated swimsuit issue

LOS ANGELES — Journalist Gayle King, plus-sized model Hunter McGrady, and returning stars Chrissy Teigen and Kate Upton pose on separate covers unveiled on Tuesday for Sports Illustrated’s 60th annual swimsuit issue.

First-time Sports Illustrated model Ms. King, the 69-year-old co-host of CBS Mornings, smiled in a pink-and-green patterned one-piece suit with spaghetti straps.

Ms. McGrady, who founded a fashion line for sizes up to 5X, wore a brown one-piece with large cutouts. She first appeared in the magazine in 2017.

Ms. Upton donned a pink and red ruffled bikini for her fourth swimsuit issue cover. Ms. Teigan, who graced the cover of the 50th anniversary issue, posed in an orange suit with a plunging neckline for the current issue, which will debut on newsstands on Friday.

The swimsuit issue debuted in 1964 and was known for showcasing skinny young women in revealing bikinis. In recent years, it has diversified its pool of models by featuring older women, larger bodies, trans models, Paralympic athletes, and a woman in a burkini, a full-body swimsuit worn by some Muslim women.

“Over the past 60 years we have shattered stereotypes, embraced diversity, and championed inclusivity,” MJ Day, editor in chief of Sports Illustrated Swimsuit, said in a statement.

In addition to the four individual covers this year, the magazine released three others featuring groups of women who had appeared in the past, including Christie Brinkley, Martha Stewart, Megan Rapinoe, Paulina Porizkova, and Tyra Banks.

The women wore evening gowns in the group photos. — Reuters

Marking ChatGPT ‘sexy’ might not end well for humans

JOAQUIN PHOENIX in a scene from the 2013 movie Her.

HER. That was the single tweet that OpenAI Chief Executive Officer Sam Altman posted as his lieutenants demoed a new ChatGPT with the same alluring vocal flourishes Scarlett Johansson used in the movie about a man who falls in love with his AI.

The most impressive thing about the new GPT-4o (the “o” stands for “omni”) is that it can discuss what it “sees” through your phone camera in real time, a skill that Google faked in a demo for its AI model last December. More startling was that it didn’t just sound human but … strangely seductive.

“Hey there,” the new version of ChatGPT said in a coy woman’s voice to a young man in the company’s main video demonstration. “I see you’re rocking an OpenAI hoodie. Nice choice.”

In a live demo at OpenAI’s headquarters in San Francisco, the AI system surprised the audience when it suddenly said, “Wow, that’s quite the outfit you’ve got on,” to someone it was helping with an algebra problem. Bloomberg News, which was at the event, referred to its tone as “flirtatious.”

In another video demo, the AI, once again with a female voice, laughed coquettishly as an OpenAI staffer pretended to ask it for advice on what to wear for an interview. “Oh, Rocky!” it said giggling after he put on a silly hat. “That’s quite a statement piece!”

If OpenAI’s mostly male engineers are trying to build the perfect girlfriend, they seem to be on the right track. If the company is trying to build a more accurate and reliable AI model, however, they still have a ways to go. GPT-4o is still only slightly ahead on key AI benchmarks, and early tests show it continues to make mistakes on key tasks.

The company has instead focused on leaping ahead with user experience, making GPT-4o more of a consumer play than one for enterprise customers. Its new model can infer emotions and respond to audio as quickly as a human would in conversation. That could fulfil a long-time goal in tech of “ambient computing,” which eschews having to stare into tiny screen and type with your thumbs for just talking and showing things to a computer.

There’s plenty of potential in that, from live tutoring to having a clever digital assistant analyze your computer screen as you work. But OpenAI’s efforts to make its AI so engaging are disconcerting.

What are the social and psychological consequences of regularly speaking to a flirty, fun, and ultimately agreeable artificial voice on your phone, and then encountering a very different dynamic with men and women in real life? What happens when emotionally vulnerable people develop an unhealthy attachment to GPT-4o?

OpenAI did not respond to these questions at the time of writing, or explain why it had given GPT-4o so much more personality. If its objective was to make its product more engaging with consumers — as it has already tried to do with developers — that could open a can of worms, threatening insidious effects on our collective mental health. Remember those priorities are what led Facebook to design algorithms that promoted the most outrageous posts on its site to keep people scrolling, helping sow greater political division.

Yet you can see why Altman may be pushing to make his chatbot more sticky. User growth for ChatGPT has been stagnating, as competing bots like Anthropic’s Claude and Google’s Gemini race for market share. It’s likely why he’s also making GPT-4, OpenAI’s most advanced model on the market, free for all.

OpenAI didn’t describe GPT-4o as a “personal assistant,” but that seems to be what the company and its rivals are now chasing. Google is expected to announce a similar tool on Tuesday.*

Elon Musk’s AI company x.AI is also working on an app that will act as a personal assistant, according to an April 2024 funding pitch deck seen by Bloomberg Opinion. The $20-a-month app, which will also have a free tier, aims to show an AI-generated feed of suggested news articles and reminders to, for instance, buy flowers at a nearby store for a friend’s birthday, or to buy concert tickets for a favorite band that is on tour, according to one slide. The deck adds that by integrating with personal data from X, it can create a “supercharged social experience.” Musk tweeted on Tuesday that a “major upgrade to Grok” was on its way.

Meta is also exploring AI-assisted earphones with cameras, and its Ray-Ban smart glasses already include an AI assistant.

As the tech giants converge on digital assistants, they may see personality as the new AI battleground. But racing to make chatbots more sexy could have bizarre side effects. Pointing to Her was perhaps a fitting metaphor for Sam Altman: The movie doesn’t end well for humans.

BLOOMBERG OPINION

*One Google executive posted a video of his phone camera on Monday, pointing to a conference stage, with a disembodied female voice describing what it could “see.”

Boomi CEO sees need to reimagine enterprise apps amid AI explosion

AT BOOMI WORLD in Denver, Boomi Chief Executive Officer Steve Lucas said he expects enterprise applications to be ‘reimagined’ amid the AI explosion. — BOOMI

By Cathy Rose A. Garcia, Editor-in-Chief

DENVER, Colorado — All enterprise applications will soon have to be reimagined amid the artificial intelligence (AI) explosion, according to the chief executive officer (CEO) of integration platform vendor Boomi.

“Remember when we would say, ‘oh, GenAI (generative AI) or new forms of potential consciousness, that’s like 30, 50 years away?’ But is it? I believe it’s not. I believe that there is a moment coming when we will be surrounded by AI,” Boomi CEO Steve Lucas said in his keynote speech at Boomi World here last May 8.

“It is just a matter of time. And I do not believe it is decades. I believe it is measured in single-digit years.”

AI dominated the conversations at Boomi World, an event that gathered customers, partners and members of the Boomi community for two days (May 8-9) here in Denver.

“Everything that you know will be reimagined. What was science fiction is now just science. All enterprise applications will be rebuilt to reason. The only enterprise applications that will matter five years from now are the ones that can reason,” Mr. Lucas said.

Boomi and other companies, he noted, are now moving very quickly to invent new technologies that can embrace AI.

“Boomi will leverage AI to help you do what you do today, wrangle the apps, the databases, and the APIs (application programming interfaces) that you need to work through. We will do that. But we’re also going to help you build the future. And we will not lose sight of who you are, what you need Boomi to be, that powerful integration and automation platform,” Mr. Lucas said.

Boomi unveiled its vision for the future, with a focus on integration and automation, API management, and data management, amid the emergence of the AI economy.

Mr. Lucas noted how the Integration Platform as a Service (iPaaS) has a crucial role in improving speed, agility, and effectiveness across business operations.

“Connectivity remains a critical challenge for almost every organization. The chief culprit is digital fragmentation, a by-product of digital shifts that, paradoxically, lead to digital silos and disjointed technical architectures that leave the average enterprise now juggling over 364 applications and numerous API gateways,” he said.

AI needs reliable, secure, and current data, Mr. Lucas said, but most of the data is “fragmented, difficult to govern, and not securely managed.”

“What companies urgently need is a unified, enterprise-scale platform that not only bridges APIs, applications, data, and AI models, but also accelerates digital transformation.”

At the event, Boomi launched a next-generation API management service, Boomi Data Hub and Agent Garden as part of its enterprise platform.

“The AI economy requires next-generation API management (APIM) that accounts for a fragmented APIM landscape and can handle the demands of enterprise-grade scalability and security that AI workloads place on APIM solutions,” Boomi Chief Technology Officer Matt McLarty said.

To address this issue, Boomi acquired APIIDA’s federated API management business and assets from Cloud Software Group.

AI AGENTS
Boomi also introduced an AI agent framework, “a set of integration and no-code development capabilities that enable business and IT users to run AI agents built by Boomi or Boomi partners, and to build and run their own AI agents to solve pressing integration and automation requirements.”

“You will be able to build agents that integrate directly with Boomi, hydrate them, ground them, train them in your organization and objectives,” Mr. Lucas said.

He demonstrated one of the first third-party AI agents called Boomi FinTalk powered by Vianai Systems on Boomi GPT.

With Boomi FinTalk, the AI agent can tap sources of financial data within the system and database. Users can then ask questions through a natural language interface as a way to analyze financial data and trends in real time.

“I believe that the combination of Boomi’s integration platform and Vianai’s human-centered AI is this new foundation on which enterprises can bring the power of generative AI to help their customers in a trusted, safe, human-centered way,” Vishal Sikka, founder and CEO of Vianai Systems, said via video during Boomi World.

Boomi also launched the Boomi Data Hub, described as a “data foundation for operational, analytical, and AI workloads.”

“With the Boomi Enterprise Platform, we’re giving customers the foundation they need for connecting and managing all their data, and for accelerating AI and API development. Using Boomi, customers can say goodbye to the digital fragmentation that’s been undermining their digital transformation efforts, and finally get the comprehensive visibility, control, and automation they need,” Mr. Lucas said.

Boomi, a global software as a service company, has over 20,000 customers and a network of 800 partners around the world.

DoF proposes higher capital for state banks

DOF.GOV.PH

THE PROPOSED amendments to the charters of Land Bank of the Philippines (LANDBANK) and the Development Bank of the Philippines (DBP) seek to increase the lenders’ capitalization to P1 trillion and P300 billion, respectively.

“I think we finalized it already… I think P300 billion for DBP and then P1 trillion for LANDBANK, if I’m not mistaken,” Finance Secretary Ralph G. Recto told reporters late on Wednesday.

These would be well above LANDBANK’s current P200-billion authorized capital stock and DBP’s P35-billion capitalization.

Mr. Recto said the proposal has been finalized and has been presented to the Senate.

The Department of Finance (DoF) earlier floated proposals to amend the state banks’ charters to increase their capitalization and allow them to publicly list on the stock exchange.

DBP earlier said it is looking to raise 20% of its capital stock from its initial public offering.

LANDBANK’s net income rose by 11% to P12 billion in the first quarter.

Meanwhile, the DBP’s first-half income in 2023 jumped by 60% to P4.42 billion. — Luisa Maria Jacinta C. Jocson

Shell swings to profit with P1.41-B income in Q1

PHOTO FROM PILIPINAS SHELL

SHELL Pilipinas Corp. turned a profit in the first quarter, with an attributable net income of P1.41 billion, an improvement from the P310.33-billion net loss a year ago.

“We are making strategic choices to strengthen our market position, boost business resilience, and drive financial strength,” Shell Pilipinas President and Chief Executive Officer Lorelie Quiambao-Osial said in a media release on Wednesday.

The listed oil company’s net sales went down by 8.2% to P59.96 million from P65.29 million previously due to lower marketing volumes, Shell said in its quarterly report.

Sales volume dropped by 10.8% to 941.2 million liters from 1.06 billion liters a year ago.

Gross profit rose by 37% to P6.11 million from P4.46 million mainly due to inventory holding gains with the uptrend in global fuel prices.

Earnings before interest, taxes, depreciation, and amortization went up by 166.1% to P4 million from P1.51 million due to the impact of pre-tax inventory holding gain against loss last year.

“As we evolve in an increasingly competitive industry, Shell Pilipinas remains steadfast in delivering value to our shareholders fueled by our refreshed strategy, strong focus on performance, and disciplined delivery,” Ms. Quiambao-Osial said.

Shell Pilipinas Treasurer Reynaldo P. Abilo said the company is looking into spending P2-3 billion as capital expenditure (capex) budget for 2024.

The capex is mainly allocated to its terminals and mobility stations. — Sheldeen Joy Talavera

Technology and customer experience

FREEPIK

The use of technology, including artificial intelligence, in any function or operation is assumed to result in efficiency. That is, if the scenario allows for the minimal if not complete elimination of human intervention in the process. Otherwise, human involvement can contradict this assertion and result in inefficiencies or bottlenecks.

However, as with anything involving people, the human “touch” is almost always necessary. Any process or function devoid of human presence can be perceived as too uninvolved and impersonal. Worse, certain nuances are missed, and the customer experience may be seen as unsatisfying or incomplete. In short, not in all situations can humans be completely removed from the process.

I was at a fast-food branch at the corner of Valero and Dela Costa streets in Salcedo Village, Makati on Tuesday afternoon. It is one of those high-tech branches where customers place their orders themselves through big touch-screen monitors. One can also pay directly while ordering, using a credit card or an electronic wallet like GCash.

The thing with this system is that it takes a bit of time to navigate the menu. The advantage, however, is that given the numerous ordering terminals available, one can take more time ordering. I placed two orders: for dine-in, a sandwich, a drink, and a dessert; for take-out, a box of fried chicken. On both instances, I paid for my orders by tapping my card on the credit card terminal just below the screen.

Problem No. 1: Twice, while placing my orders, two different credit card terminals issued torn-up receipts. Obviously, for the two terminals I used, the thermal rolls were misfeeding. Thus, the receipts bunch up during printing and tear. And not one store staff was checking if the credit card terminals were working properly, i.e., correctly printing receipts. I had to call their attention to the torn receipts.

Problem No. 2: My first order, for a sandwich, a drink, and a dessert took 15 minutes to process and be delivered to my table. For any fast-food establishment, 15 minutes is too long for serving time. Considering the fast-food process, had I gone to another branch where orders are still manually taken, I would have had my order on hand as I stepped away from the counter.

Problem No. 3: The takeout chicken order was placed at 5:04 p.m., as indicated in the printed receipt. At 5:24 p.m., I approached the counter to follow up. The person at the counter walked away to consult someone, and then came back to me that it would take another 20 minutes for them to process the order. I was told 20 minutes after ordering that I would have to wait another 20 minutes. Of course, I found this to be unreasonable: 40 minutes to fix a box of fried chicken?

To the store’s credit, after I complained that another 20 minutes of waiting was unacceptable, considering that I already waited 20 minutes, someone went to the back and came back with my order. The box was handed to me, no bag, no napkins, and no offer of utensils. Again, the staff behavior and the customer experience at the same store would have been a lot better had I opted to drive-through.

I know this for a fact because I frequently use that store’s drive-through. In fact, that very same Tuesday afternoon, I bought iced coffee at the drive-through before I decided to park and walk into the store. But that pleasant and quick service at the drive-through was overturned by the poor customer experience in-store for two orders.

Problem No. 4: If one studied the cycle time for the entire ordering process, at least from my experience, the use of technology appears to have slowed rather than hastened the ordering and delivery process. It took a longer time for the food to get to the customer’s hands, as compared to the manual ordering system of old. In fact, had I ordered drive-through for the food, I am certain it would have been faster. And this leads me to wonder if the queuing system is biased and prioritizes drive-through orders over in-store dine-in and in-store take-out purchases.

Problem No. 5: Under the automated self-order system, the store loses the chance to directly interact with the customer to relay possible waiting time or to convey possible delays in servicing the order. At least during drive-through, as one orders, the order-taker immediately relays to the customer whether a delay can be expected, i.e., 10 minutes waiting time. This is not the case with the self-order system using touch screens.

In most cases, technology aims to simplify tasks. But it can sometimes introduce complexity. Poorly designed interfaces or complex technological systems that require extensive training can lead to inefficiencies as users take longer to complete tasks or make more errors. Or sometimes, human behavior becomes the bottleneck. Or, there are “disconnects” in the system.

In the case of processing the fried chicken order, technology automated the ordering and payment. But the actual task of cooking the chicken and packing the order still relied on human intervention. It was perhaps a case of orders coming in faster than the kitchen can handle. But the faceless robot interfacing between the two functions — order taking and food preparation — does not know any better. There lies the first disconnect.

And because of the automated ordering system, human oversight in the preparation process became more crucial. And the task of managing customer expectations fell through the cracks, as there was no way for the point-of-sale or ordering system nor the food preparation system to directly inform or advise the customer of possible delays. This was the second disconnect.

So, unless the customer walks up to the counter to complain, the staff and all the systems are all clueless about the poor customer experience. And this is concerning considering that a problem can be “detected” only after a complaint comes in. In terms of managing customer experience, if a complaint comes in, then that means the system already “failed” and no one saw it coming.

I am all for automation and the use of high-technology and artificial intelligence. But it is essential for companies to develop strategies that can enhance the benefits of technology but at the same time mitigate its negative impacts on productivity and human skills. Automation and technology should not displace people but complement them. Interpersonal skills cannot be automated.

Moreover, better interfaces should be developed to address possible “disconnects.” If order-takers at drive-through counters can get updated information from the kitchen on delays, and can relay the same information to drive-through customers, why can’t the self-order system be configured to carry and convey the same information to customers ordering in-store?

Automation and self-ordering systems should not be seen as just labor-saving devices, or tools for operational efficiency. Technology allows for customization and should be used not just to save on costs and to improve processes. Just as important, technology should also improve and enhance the customer journey and the customer experience.

 

Marvin Tort is a former managing editor of BusinessWorld, and a former chairman of the Philippine Press Council

matort@yahoo.com

ADVERTISEMENT
ADVERTISEMENT