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RCBC closes sustainability bond offer

DEMAND for Rizal Commercial Banking Corp.’s offer of sustainability bonds reached P17.87 billion. — BW FILE PHOTO

RIZAL COMMERCIAL Banking Corp. (RCBC) has closed its offering of dual-tenor fixed-rate ASEAN sustainability bonds, with the proceeds to be used for general funding purposes and for financing eligible projects under its sustainable finance framework.

Demand for the peso-denominated papers reached P17.87 billion as of Friday, more than 5.9 times as much as RCBC’s initial target issue size of P3 billion, the bank said in a filing with the local bourse on Monday.

The 2.5- and 5.25-year securities will be issued at a fixed rate of 3.2% and 4.18%, respectively.

“Proceeds from the offering will be used to support the bank’s asset growth, refinance maturing liabilities, other general funding purposes as well as eligible loans defined in the bank’s Sustainable Finance Framework,” RCBC said.

The debt papers were offered from March 12 to March 19. They are expected to be listed on the Philippine Dealing and Exchange Corp. on March 31.

The sustainability bonds are part of RCBC’s P100-billion bond and commercial paper program. The papers also marked the bank’s sixth foray into the peso bond market.

Standard Chartered Bank served as the sole lead arranger and bookrunner for the transaction while RCBC Capital Corp. was the financial advisor for the bond issuance. Both parties were selling agents for the papers.

RCBC earlier sold P15 billion in ASEAN green bonds, P8 billion in ASEAN sustainability bonds, and a cumulative P31.15 billion from other bond offerings.

The bank’s net income decreased by 7% to P5 billion in 2020 from P5.388 billion in 2019 due to higher loan loss reserves amid the crisis.

RCBC shares closed at P17.50 apiece on Monday, inching up by 40 centavos or by 2.34% from the previous day. — L.W.T. Noble

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PhilGuarantee-backed MSME loans surge in first two months

THE Philippine Guarantee Corp. (PhilGuarantee) guaranteed P952.5 million worth of loans for micro, small and medium enterprises (MSMEs) in the first two months of 2021, against the P207 million total at the end of 2020, after the company streamlined its application process.

The number of MSMEs who had their loans guaranteed rose to 8,839 at the end of February from 2,948 at the end of 2020, the Department of Finance said in a statement Monday, citing a report from PhilGuarantee.

“The implementation of improved processing and evaluation parameters starting this year led to this remarkable increase in the number of beneficiaries under the MSME Credit Guarantee Program,” PhilGuarantee President and CEO Alberto E. Pascual was quoted as saying.

Month on month, MSMEs with approved guarantee applications rose 90%, he said.

The loans receiving guarantees were originated by 10 accredited banks and financial institutions.

The governing board of PhilGuarantee, chaired by Finance Secretary Carlos G. Dominguez III, has approved credit guarantee facilities worth P37.7 billion to 34 banks since the program started last year.

Some 22 banks are currently applying for the MSME loan guarantee program.

“The approval of the credit guarantee facilities enabled the availability and accessibility of credit from banks that would have otherwise been reluctant to lend to MSMEs owing to the uncertainties that prevailed with the onset of the COVID-19 pandemic,” Mr. Pascual said.

The top industries that benefited from the program were wholesale and retail sectors receiving P723 million in guarantee loan cover, or 76% of the total. Other leading sectors were manufacturing (P83.6 million or 8.78% of the total); and transport, storage and communication (P65 million or 6.8%).

PhilGuarantee is implementing the government’s P120-billion MSME credit guarantee program, a scheme meant to help the hard-hit sector bounce back from the economic downturn.

The program hopes to encourage lending by banks by helping them overcome their risk aversion in lending to MSMEs.

Mr. Pascual said the target is to increase the MSME guarantee loan portfolio to P4 billion and grow the number of beneficiaries to 8,000 companies by year’s end.

The loans applied for guarantees average P1 million, with some as low as P100,000.

The government injected an additional P5 billion into PhilGuarantee, which it will use to guarantee loans of larger companies requiring up to P300 million in loan cover.

The program provides 50% guarantee cover for working capital loans and up to 80% for term loans of up to seven years for use in capital expenditure projects. — Beatrice M. Laforga

Boracay rehab delayed by resettlement snags

THE Department of Environment and Natural Resources (DENR) said the timeline for rehabilitating Boracay Island, originally due to be completed in May, has been delayed by resettlement problems.

“We haven’t started the resettlement activities of the informal settlers living in the forest timberland. There are lots of civilians who live there, and because of the pandemic, we weren’t able to resettle them,” Environment Secretary Roy A. Cimatu said at a briefing Thursday.

He said they were allowed to remain for “humanitarian” reasons in light of the pandemic.

“After the pandemic, we’ll look for a place for them, then we will assist them in moving to the new location,” he said.

Mr. Cimatu also noted that the rehabilitation team was not able to transfer the Boracay workers to the mainland to decongest the island.

“We haven’t transferred any workers yet. We had the intention of transferring them from the island to the mainland to add to the island’s carrying capacity,” he said.

Mr. Cimatu said the department completed various infrastructure-related activities, including acquiring easements for roads and removing structures violating the easement rules.

At the end of December, the Boracay Inter-Agency Task Force (BIATF) said that the number of structures violating easement rules fell to 342, representing 21% of all the illegal structures on the island.

The BIATF’s authority expires in May, around the time the rehabilitation was originally scheduled to end.

The DENR has asked President Rodrigo R. Duterte to grant a one-year extension to the BIATF’s term in office. Mr. Cimatu, who chairs the task force, said the term extension will “allow the task force to complete all its projects which were stalled due to the global health emergency.”

The BIATF was created on May 8, 2018, by Executive Order (EO) No. 53. The term of the task force was due to end in 2020, but Mr. Duterte issued another EO granting a one-year extension. — Angelica Y. Yang

Hog deliveries to Metro Manila markets approaching 200,000

LIVE HOGS transported to Metro Manila are nearing 200,000 animals to ease the supply situation for pork in the capital and in support of price controls imposed on Feb. 8, the Department of Agriculture (DA) said.

The DA said hog deliveries totalled 198,231 since Feb. 8, after an additional 4,249 hogs arrived in Metro Manila on March 21.

Of the new arrivals, 2,433 hogs were from Cavite, Batangas, Rizal, and Quezon, while 1,040 were from Oriental Mindoro 340 hogs from Central Visayas, and 176 from Central Luzon.

Other areas that sent shipments were Davao with 140 hogs and Bukidnon with 120.

According to the DA, the regions that delivered the most hogs to date were Calabarzon (Cavite, Laguna, Batangas, Rizal, and Quezon) with 90,115 animals; Western Visayas with 35,622; and Mimaropa (Mindoro, Marinduque, Romblon, and Palawan) with 21,983.

The DA said Central Luzon delivered 42,160 kilograms of pork in carcass form on March 21. The new shipments brought the total carcass volume to 1.37 million kilograms since Feb. 8.

Pork supply has tightened due to an outbreak of African Swine Fever, which has sent prices higher and threatened another inflation crisis.

President Rodrigo R. Duterte signed Executive Order (EO) No. 124 on Feb. 1 that imposed a price ceiling on pork and chicken retail prices.

EO 124, implemented a week after its signing to give the hog industry a grace period, capped the retail price of pork shoulder (kasim) at P270 per kilogram, pork belly (liempo) at P300 per kilogram, and whole chicken at P160 per kilogram.

The DA’s price monitoring report on Monday indicated that kasim prices ranged between P310 and P350 per kilogram in selected Metro Manila public markets, while liempo fetched P330-P400. — Revin Mikhael D. Ochave

BIR urged to adopt ‘virtual stamp’ for cigarettes

A SENIOR legislator on Monday proposed that the Bureau of Internal Revenue (BIR) create “virtual stamps” for export cigarettes to deter their smuggling into the domestic market and to conform with international best practices.

At a hearing conducted by the House Committee on Ways and Means Monday, Representative Jose Ma. Clemente S. Salceda proposed a “less visible” form of security labelling, along with material labelling features.

“I’m asking the BIR to upscale and to come up with a virtual (stamp) para readable lang siya dito sa Pilipinas (which can be read only in the Philippines),” he told BIR officials at the hearing.

BIR Deputy Commissioner Arnel SD. Guballa replied, “We will discuss (the technical details) with our IT.”

Mr. Salceda also reiterated his call for the BIR to revoke Revenue Regulations No. 9-2015 which exempts cigarettes sold for export from tax stamp affixture and are instead given a unique identification code that is machine readable, adding that unstamped export cigarettes were a key source of supply for smugglers. Cigarettes for domestic sale affixed with tax stamps indicate that the manufacturer has paid the excise taxes due.

The House tax panel has found that tobacco smugglers evade excise taxes by declaring tobacco products “for export.”

The BIR added that current tax stamps affixed cigarettes for domestic sale have many security features which make it easy for the agency to spot fake stamps.

Mr. Guballa said while the BIR supports the proposal requiring the affixture of stamps on export cigarettes, he added that manufacturers expressed concerns that this could deter foreign markets since most other countries prefer the products to be shipped without stamps.

“Ang demand ng abroad is walang stamps (The international market demand is for cigarettes to have no stamps),” he said.

The government loses P30 billion annually due to untaxed tobacco products on the domestic market. — Gillian M. Cortez

DoE solicits comment on draft coal handling, distribution rules

THE Department of Energy (DoE) is soliciting comment on its draft department circular covering the rules for coal handling, transport, storage and distribution.

In a notice on its website Friday, the DoE said that it will be accepting proposals or comments until March 31.

Interested parties were invited to send their input via e-mail to the DoE’s Director of Energy Resource Development, Cesar G. Dela Fuente III or the department’s head of the Coal and Nuclear Minerals Division, Nenito C. Jariel, Jr.

The DoE said the draft rules will apply to “all coal traders, logistics service providers, end-users, holders of coal operating contracts and small-scale coal mining permits and all other persons engaged in coal operations.”

Some measures in the draft include ensuring the health and safety of workers, rules for maintaining a coal stockpile, and proper storage of coal to minimize emissions of dust and foul odors, among others.

The rules provide for non-compliant operators to either respond within seven days to a notice of non-compliance or be served a cease-and-desist order.

The notice of non-compliance procedure involves either the issue of a clearance by the DoE to the operator’s answer or the issue of a notice of conference.

“In case of a notice of conference, the concerned DoE Field Office or Energy Resource Development Bureau Director shall preside over the conference to clarify the issues and require submission of additional information,” the DoE said in its draft.

The department will then issue a clearance letter or notice of violation as needed as well as an order of payment if a fine is deemed necessary during the conference.

On its website, the DoE also outlined a 54-item checklist which will be used to gauge compliance among companies with coal operations. — Angelica Y. Yang

New quarantine raises old fears about flow of farm goods

THE PROSPECT of a stricter quarantine has raised fears of disruption to the flow of food from producers to markets, as occurred early on in the pandemic.

At a virtual briefing Monday, food security advocacy group Tugon Kabuhayan said the early days of the pandemic restricted the movement of farm produce, causing surpluses to pile up and spoil in producer provinces.

Tugon Kabuhayan convenor Asis G. Perez said: “The call is in view of travel restrictions imposed by Inter-Agency Task Force (IATF) for the Management of Emerging Infectious Diseases Resolution No. 104 where only essential travel into and out of Bulacan, Cavite, Laguna, Rizal and National Capital Region will be allowed due to the surge of active coronavirus disease 2019 (COVID-19) cases.”

Mr. Perez, a former Bureau of Fisheries and Aquatic Resources director, said the failure to access markets resulted in food waste and lost income, with some unsold vegetables donated or used as feed for farm animals.

“Fish and vegetables spoiled while live hogs and cattle became emaciated as checkpoints and other quarantine protocols affected the free flow of goods,” Mr. Perez said.

Mr. Perez proposed that local government units (LGUs) distribute farm produce to areas observing localized lockdown, instead of canned products.

He said such practices will provide farmers a market for their products, while giving people affected by the lockdown access to healthy food.

“Also, the procurement of farm produce by LGUs can compensate for the decline in consumption due to the closure of dine-in restaurants as a result of the stricter quarantine protocols,” Mr. Perez said.

“It should be cleared with (local government units) that food producers do not only transport produce via big trucks. Some small food producers use jeepneys and pick-up trucks. It should be clear that as long as the vehicle is carrying food products, it should be granted access,” Mr. Perez said.

“Producers simply need to ensure that commodities from farms reach consumers,” he added.

Asked to comment, Department of Agriculture Spokesperson Noel O. Reyes said by mobile phone Monday that the transport of agricultural commodities will remain uninterrupted despite the implementation of stricter quarantine measures.

“There will be no changes. Health protocols should be observed. If there are problems in the respective LGUs, we would like to reiterate that there is a policy from the Department of the Interior and Local Government (DILG) on the unhampered movement of food and other basic commodities from the farms to the markets,” Mr. Reyes said. — Revin Mikhael D. Ochave

House ratifies bicam report on bill extending lifeline rates by 30 years

electric meter

THE HOUSE of Representatives ratified on Monday the bicameral conference committee report on a proposed law that will extend the lifeline rates for marginalized households until 2051.

In plenary session, legislators ratified the report harmonizing House Bill 8145 and Senate Bill 1877, which propose to extend and enhance the implementation of the lifeline rate, amending Section 73 of the Electric Power Industry Reform Act of 2001 (EPIRA) Law.

“The bicam report is hereby ratified,” according to Representative Bernadette Herrera-Dy, who was sitting as deputy speaker.

Lifeline rates are the subsidies given to marginalized electricity end-users who cannot afford to pay full cost. The subsidy will be funded by non-lifeline consumers.

The EPIRA Law provides that subsidized rates for low-income energy consumers be determined by the Energy Regulatory Commission. They were to run originally for 10 years, which was then extended in 2011 by another 10 years.

The proposed measure will extend the lifeline rates by a further 30 years. — Gillian M. Cortez

Warehouse Receipts Law amendments seen helping farmers obtain financing

NFA rice warehouse
PHILIPPINE STAR/ MICHAEL VARCAS

THE PASSAGE of a measure that will amend the Warehouse Receipt Law will help farmers grow their businesses by allowing them to more easily obtain bank financing, a former Finance Secretary said.

The bill will allow farmers to deposit their goods in an accredited warehouse, which will issue them a warehouse receipt, certifying storage of goods including quantity and quality. The receipt can be used as a collateral for a bank loan to finance the next cropping season, former Finance Secretary Margarito B. Teves said in a Senate hearing.

“This allows farmers to sell produce at the best times, attain a better income, and help decrease post-harvest losses,” he said at a hearing of the chamber’s Trade committee.

“It will address the banks’ lack of confidence to lend to (small and medium enterprises) and farmers. The bill brings integrity to the use of warehouse receipts as collateral by providing for accreditation of warehouses engaged in the issuance of warehouse receipts.

Mr. Teves said a centralized IT system or repository of all warehouse receipts will also support the agriculture sector by capturing data on crops and provide information to policymakers in designing programs to ensure food security.

The centralized online system of receipts “complements the risk management tools of banks in doing their due diligence.”

“It will support the growth of e-commerce and warehousing by enabling supply chain finance, minimize logistics and fulfillment challenges brought by the growth of e-commerce and bring more integrity and security to transactions,” he said.

The bill will also help achieve the President’s agenda of promoting rural development by increasing agricultural and rural enterprise activity, he said.

“We hope the distinguished members of the Senate act urgently on the measure to help attain more inclusive economic growth,” he said.

Senators Francis N. Pangilinan and Sherwin T. Gatchalian both filed bills to modernize the Warehouse Receipts Law of 1912, or Act No. 2137.

Senate Bill No. 632 filed by Mr. Pangilinan seeks to establish an online warehouse receipts registry.

“Through such registry, the public, especially banks and other financial institutions, may easily verify the quantity and quality of goods covered by each warehouse receipt. As warehouse receipts become more reliable, farmers may now use their harvests, evidenced by warehouse receipts, as collateral for securing loans,” according to the bill’s explanatory note.

Mr. Gatchalian’s Senate Bill No. 2049 also seeks to establish a registry for all warehouse receipts, to raise the confidence of financial institutions in accepting collateral from farmers and micro, small and medium enterprises. — Vann Marlo M. Villegas

Green Climate Fund allots $300 million to ADB for green recovery program

THE Green Climate Fund (GCF) has allocated $300 million for Asian Development Banks (ADB) projects which aim to build climate resilience and promote sustainable economic development.

In a statement Monday, the ADB said that funds from the GCF will finance its first green recovery program.

“The ASEAN Catalytic Green Finance Facility (ACGF) Green Recovery Program aims to leverage GCF and ADB funds to catalyze financing from development partners and private capital sources to support more than $4 billion worth of green infrastructure projects across the region,” the ADB said.

Projects supported by the program will incorporate green finance instruments and approaches.

The bank said that it approved the funding requirements for the Green Recovery Program on Friday at a board meeting.

“The program will help Southeast Asian countries design green stimulus packages and projects that will create climate-friendly jobs, boost economic growth, and help countries fulfill their pledges under the Paris Agreement to reduce greenhouse gas emissions,” ADB Vice-President Ahmed M. Saeed was quoted as saying.

He added that the ACFG Green Recovery Program is designed to “kickstart low-emissions investments during the first few years of recovering from the coronavirus disease.”

The program will provide technical assistance and concessional loans to around 20 green infrastructure projects in Southeast Asia.

“Over a 30-year period, the projects are expected to reduce carbon dioxide emissions by 119 million tons and create 340,000 green jobs in key sectors such as sustainable transport, renewable energy and energy efficiency systems, as well as low-carbon agriculture and natural resources,” the ADB said.

Headquartered in South Korea, the GCF is a global fund created to help developing countries address climate change.

The ADB has set a target of $80 billion worth of climate financing by 2030. Chief of Energy Sector Group Yongping Zhai estimated the bank’s clean energy financing to be worth $23 billion between 2009 and 2019. — Angelica Y. Yang

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