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Spotify adds COVID notices in effort to stop Rogan boycotts

MATTHEW HARRIS/ EN.WIKIPEDIA.ORG/

SPOTIFY Technology SA outlined steps it will take to halt the spread of misleading information about COVID-19 on its audio-streaming service in an attempt to quell a growing controversy over its support for the podcast host Joe Rogan.

Spotify published internal rules Sunday governing what content is and isn’t allowed on its service, and Chief Executive Officer Daniel Ek said in a blog post that the company will add an advisory to any podcast episode that addresses the coronavirus. That advisory will direct listeners to a hub offering more information about the pandemic.

The company is trying to end a mounting insurrection among a vocal minority of users and musicians without alienating its most popular podcaster. Folk singers Neil Young and Joni Mitchell pulled their music from Spotify last week in protest of Mr. Rogan, a popular podcaster who has hosted several outspoken skeptics of the COVID-19 vaccines.

Spotify created rules governing acceptable content on its service years ago and built a hub with COVID-19 information early in the pandemic. While those policies have been accessible for employees, the company didn’t make them public until Sunday after a series of scandals jeopardized its business.

“We have had rules in place for many years but admittedly, we haven’t been transparent around the policies that guide our content more broadly,” Mr. Ek wrote in the blog post. “This, in turn, led to questions around their application to serious issues including COVID-19.”

“We know we have a critical role to play in supporting creator expression while balancing it with the safety of our users,” he wrote. “In that role, it is important to me that we don’t take on the position of being content censor while also making sure that there are rules in place and consequences for those who violate them.”

Singer-songwriters Neil Young and Joni Mitchell — both of whom suffered from polio as children — announced they are removing their music from Spotify in protest that the popular streaming service has allowed the airing of misinformation about COVID-19 vaccines.

Mr. Young objected to his music being played on the same platform as Joe Rogan’s top-rated podcast The Joe Rogan Experience. A prominent vaccine skeptic, Mr. Rogan has stirred controversy with his views on the pandemic, government mandates, and vaccines to control the spread of the coronavirus.

Earlier this month, 270 scientists and medical professionals signed a letter urging Spotify to take action against Mr. Rogan, accusing him of spreading falsehoods on the podcast.

In a tweet on Saturday social-research professor best-selling author Brene Brown — host of the Spotify-exclusive podcasts Unlocking Us and Dare to Lead — said she would “not be releasing any podcasts until further notice,” though she didn’t specify why. Ms. Brown could not immediately be reached for comment.

Britain’s Prince Harry and his wife Meghan also expressed their concern to Spotify about COVID-19 misinformation on its platform and are committed to continuing to work with the company, a spokesperson for their Archewell foundation said on Sunday.

A Spotify spokesperson said it is the first major podcasting service to publish content guidelines and that it would work to refine them in the years ahead. The number of podcasts on Spotify has ballooned to more than 3 million shows over the past few years, and the company is still creating its best practices for evaluating them.

Yet it remains to be seen whether the action will be enough to calm the maelstrom. The rules outlaw dangerous, deceptive, sensitive, and illegal content, including anything that advocates or glorifies serious physical harm, deceptive content, interferes with an election, or infringes on a copyright. Spotify’s post doesn’t mention Mr. Rogan by name, nor does it specify any podcasts it has already taken down. None of Mr. Rogan’s episodes violate Spotify’s policies, the spokesperson said.

Mr. Rogan has presented a public relations conundrum for Spotify ever since the company paid more than $100 million for the exclusive rights to his show. He offers a hospitable environment for guests with controversial points of view about the pandemic, politics and just about every other topic.

The criticism and controversy has thus far been worth it to the company’s leadership: Spotify’s stock price jumped the day they announced the deal, and Mr. Rogan hosts the single most popular podcast on its service. Spotify moved into podcasting hoping it would turn its popular but unprofitable music service into a more lucrative business. Investors cheered the efforts, though they have cooled on the company in recent months. Its stock has fallen 48% in the past 12 months, closing at $172.98 on Jan. 28 with a stock-market value of $33 billion.

Criticism from famous musicians hurts Spotify more than any angry social-media comments. The company built its business as the most popular paid music-streaming service, and music is still the most popular audio genre on Spotify. While neither Ms. Mitchell nor Mr. Young matters to Spotify’s business all that much, they are two of the most respected musicians alive and their voices have the potential to inspire others to speak out. — Bloomberg with Reuters

T-bills fully awarded as rates drop on inflation bets

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THE GOVERNMENT made a full award of the Treasury bills (T-bills) it auctioned off on Monday as rates declined on expectations of easing inflation.

The Bureau of the Treasury (BTr) raised P15 billion as planned via the T-bills it auctioned off on Monday as total tenders reached P59.77 billion, almost four times as much as the initial offer.

However, Monday’s bids were lower than the P76.37 billion in bids seen last week.

Broken down, the Treasury raised P5 billion as programmed via the 91-day securities from P17.2 billion in bids. The average rate of the three-month debt papers went down by 0.2 basis point (bp) to 0.691% from 0.693% last week.

The government also borrowed P5 billion as planned through the 182-day instruments on Monday from P24 billion in tenders. The six-month T-bill’s average rate fell by 5.4 bps to 1.023% from 1.077% previously.

Lastly, the BTr made a full P5-billion award of the 364-day papers as bids reached P18.57 billion. The average yield on the one-year papers stood at 1.408%, down by 0.2 bp from 1.41% a week earlier.

At the secondary market prior to the auction, the 91- 182- and 364-day T-bills were quoted at 0.7562%, 1.0737% and 1.4404%, respectively, based on the PHP Bloomberg Valuation Reference Rates published on the Philippine Dealing System’s website.

National Treasurer Rosalia V. de Leon in a Viber message to reporters said the BTr made a full award of its offer as there was strong buying interest for short-term papers.

T-bill rates also declined on expectations inflation eased further in January, Ms. De Leon said.

A bond trader likewise said T-bill yields moved sideways because inflation is expected to have decelerated last month.

“There are also other factors which investors considered when placing their bids in today’s bills auction such as rate hikes by the Fed and rate decisions of the Bangko Sentral ng Pilipinas in the second half of the year,” the trader said in a Viber message.

“These may be the reasons why demand at the shorter end of the curve remain robust while yields for longer-term debt have been rising in recent auctions.”

Inflation is expected to have decelerated in January, as a favorable base effect offset the rise in oil prices and the impact of Typhoon Odette on food supply.

A BusinessWorld poll of 16 analysts last week yielded a median estimate of 3% for January inflation.

If realized, this will be the second consecutive month that inflation will be within the 2-4% target band of the Bangko Sentral ng Pilipinas. It will also be slower than the 3.6% in December. 

The Philippine Statistics Authority (PSA) will release the January consumer price index (CPI) report on Feb. 4 (Friday). The PSA will change the base year for the CPI to 2018 starting in the January report to reflect changing Filipino household consumption patterns.

Meanwhile, US Federal Reserve Chairman Jerome H. Powell last week said the central bank may raise interest rates starting in March, although the pace of later rate hikes is yet to be decided, Reuters reported.

The BTr plans to raise P200 billion from the domestic market in February, or P60 billion via T-bills and P140 billion from Treasury bonds.

The government borrows from local and external sources to help fund a budget deficit capped at 7.7% of gross domestic product this year. — Jenina P. Ibañez with Reuters

ERC imposes P4.31-million fine on Batangas power plant

THE Energy Regulatory Commission (ERC) has fined Sem-Calaca Power Corp. (SCPC) a total of P4.31 million after the two units of its power plants breached the maximum allowable unplanned outages.

In a decision posted on its website on Monday, the ERC found the company to have violated Article 5 of the commission’s Resolution No. 10, Series of 2020 after its power plant’s units 1 and 2 exceeded by 5.24 days and 96.2 days, respectively, the 16.8 days allowable unplanned outages for a pulverized coal-fired power plant per generation unit per year.

“According to SCPC, most of these unplanned outages were due to leaks in the boiler tubes and burners which were not part of SCPC Unit 1’s Life Extension Program (LEP),” the ERC said.

The ERC decision was supported by Resolution No. 21, series of 2016, which measures power reliability via frequency, duration, and magnitude of adverse effects on the electric supply.

Frequency is the number of times the generation unit went offline after it had breached the maximum allowable unplanned outage; duration is calculated as the number of total unplanned outage days minus the maximum allowable unplanned outage days; magnitude is the rated capacity of the generating unit divided by the highest rated capacity in the grid where the generating unit is located, the ERC explained.

Frequency is the basis of the imposable penalty, while duration and magnitude are given the percentages of 40% and 60%, respectively, in consideration of their significance to reliability, the commission said.

BusinessWorld has reached out to DMCI Holdings, Inc., the holding firm of SCPC’s parent company Semirara Mining and Power Corp., for a comment on the decision but has not immediately received a response. SCPC operates a coal-fired power plant in Calaca, Batangas with two identical units of 300 megawatt units.

The ERC said in its decision that the power industry is imbued with public interest under Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA) “to ensure the quality, reliability, security, and affordability of the supply of electric power” and “to protect the public interest as it is affected by the rates and services of electric utilities and other providers of electric power.” — Marielle C. Lucenio

How ABS-CBN continues to save PHL film heritage

Project endangered by pandemic lockdowns and network franchise loss

LOST records are lost histories. Like books, films document stories of our history, and serve as mirror to our society. A recent webinar discussed an effort to save these celluloid pieces of history.

The Financial Executives Institute of the Philippines (FINEX) Philippines Arts and Culture committee hosted the webinar “Ganito Tayo Noon… Sagip Pelikula: Restoring Our Cinematic Heritage” on Jan. 27, which was streamed via Facebook.

Philippine cinema goes back from 1919 when the “Father of Philippine Movies” Jose Nepumuceno premiered his first silent narrative film, Dalagang Bukid (1919), starring bodabil (vaudeville) performer and future National Artist for Theater and Music Atang de la Rama, and Marcellano Ilagan. It is estimated that since then, more than 8,000 movies were shot on film until movie production went fully digital in 2012.

Within that span of time, there were two so-called “Golden Ages” of Philippine movies. In his presentation, Leonardo “Leo” P. Katigbak, who is Head of Film Archives & Restoration at ABS-CBN Corp., said that the first was in the 1950s with the films from major studios like Sampaguita, LVN Pictures, Premiere Productions, and Lebran International. The second golden age is considered to have happened in the 1970s, when films focused on more socio-political themes.

But many of these early films are gone —  of the 8,000+ movies shot on film, only around 2,000 have surviving copies.

Prior to the advent of the Internet and long before online streaming, film producers saw no aftermarket for the films after their theatrical releases — they had no incentive to preserve the films. Most of the films stock deteriorated due to the country’s humid weather and the need for expensive maintenance. The type of film base used also made it difficult to preserve and store properly.

The earliest film base, which was used until the 1950s, was made of nitrate which were highly flammable and unstable. Said Mr. Katigbak. Another was acetate (used from the 1920s to the 1980s) which quickly deteriorated. It was only in the mid-1990s that polyester (which was unbreakable by human hands) was used.

It was only in 2008 that film producers started going fully digital, he said. Some of the last movies shot on film were Wenn Deramas’ This Guy’s in Love with U Mare!, Ruel S. Bayani’s One More Try, and Olivia Lamasan’s The Mistress, which premiered in 2012.

SAVING OUR FILMS
To preserve the Philippine’s film heritage, the ABS-CBN Film Archives, which was established in 1994, started exploring the restoration of old films in 2011. The following year, Ishmael Bernal’s classic Himala (1982) was released as the first digitally restored film from the ABS-CBN Film Archives and Central Digital Lab project. In 2015, the project launched the “Sagip Pelikula” campaign to further raise awareness. In 2021, the project marked its 10th anniversary with over 200 films restored.

Mr. Katigbak differentiated between film preservation, revisionism, and restoration.

“Preservation is ‘as is where is,’” Mr. Katigbak said. No interventions are made to improve film quality, it is simply to preserve what you have. “You don’t want the film to deteriorate any further,” he said.

Revision, he said, is where elements are changed or improved. “[This is where] directors were making certain changes [to their works] that they felt were originally wrong or not able to do.”

“But for our purposes, what we want is really, pure restoration. So, it’s bringing it back to what we think was the original intent of the creators,” Mr. Katigbak said.

“We have our own vaults ABS-CBN [where] we make sure that it is humidity controlled, and quality controlled. The cans (of film) are often checked to see if there is vinegar syndrome,” Mr. Katigbak said.

Vinegar syndrome is a form of degradation that occurs with cellulous acetate film, characterized by an obvious vinegar smell due to the release of acetic acid by the degrading film.

While the ABS-CBN Film Archives are capable to cleaning smudges, discoloration and misalignments in house, major restoration —  color grading and HD, 2K, 4K conversion —  are done in collaboration with international companies such as the Italian film restoration laboratory L’Immagine Ritrovata, and Japanese audiovisual conservation and digitization company Tokyo Koon Co.

Mr. Katigbak noted that the cost of restoring one film ranges from P500,000 to P100 million.

“There are 24 frames per second of film,” Mr. Katigbak explained. “So, when you talk about the film that [runs at] 90 minutes… You’re in that range of about 150 to 200,000 frames that you need to physically fix.”

In choosing which films to restore, the ABS-CBN restoration team focuses on those that earned awards and recognition, were box office hits, or present a cultural snapshot of the country.

Mr. Katigbak said that when they started the project, the team did not want to be celebrity-centric but writer- and director-centric. The team had a master list of priority titles but had to adjust depending on availability and condition of the film.

CHALLENGES IN 2020
The film restoration project slowed down in March 2020 because of the lockdown due to the COVID-19 pandemic. Employees had to work remotely.

The project also suffered a huge blow when ABS-CBN’s broadcast frequency franchise was denied in May 2020. In August that year, many of the network’s departments were forced to close, and the ABS-CBN Archives had to downsize.

“We made a presentation with management to show that there was still a need to preserve, or at least keep a smaller group to save in the movies,” Mr. Katigbak said.

The 14-member team shrank to five, and majority of the work was limited to what they can accomplish in-house — no more restoration work done abroad.

“A lot of the movies that we release up to last year, were actually movies that were completed before we were shut down,” he said. “But all of these lockdowns and limiting work from home are also affecting us because our work is in the office.”

“Fortunately, we have our scanner,” Mr. Katigbak said, adding they are now more focused on digital scanning and enhancements of films.

REACHING AUDIENCES AND MOVING FORWARD
With the network shutdown, and long closure of cinemas, distribution on online platforms was explored as a way to reach a wider audience.

“So, we explore as much as we can,” Mr. Katigbak said. “It’s not just, for example, the platforms owned and operated by ABS-CBN.”

The digitally restored films are accessible on Apple TV, Netflix, and KTX.ph. In the past year, some titles were also shown for free through the ABS-CBN film restoration Facebook page.

“People generally will watch the movies regardless. Unless there is awareness, how will they even know to look for it and to ask for it?” Mr. Katigbak said.

As of Jan. 27, the project has 194 digitally restored titles which are accessible in 64 territories.

“We’re aggressively putting them out [on various online platforms]. And we’re enjoying the fact that there’s a lot of demand for them, both locally and internationally,” Mr. Katigbak said. “So hopefully, that’s the one that’s going to continue. But as with anything, you need new products in the pipeline, so that you sustain interest.”

The ABS-CBN film restoration project is currently working on the digital scanning and enhancement of Giliw Ko (1939) and Triplets (1960).

“We need to look back at cinema as a record of our identity and who we are as a Filipino. It’s the one that really captures it in all its vibrancy, more than a static photo,” Mr. Katigbak said.

“If we don’t save our movies, we will eventually forget them and that is one of the greatest tragedies that can happen. Because they are not just entertainment, they are a reflection of who we are and our identity as a people,” he said.

To watch the digital restored films, visit http://itunes.com/abscbn, https://www.ktx.ph/. For more information, visit https://www.facebook.com/filmrestorationabscbn/. —  Michelle Anne P. Soliman

Underground cabling will need gov’t subsidy, proper planning

By Marifi S. Jara, Mindanao Bureau Chief

ELECTRICITY and telecommunication companies are willing to shift to an underground cable system but such venture would require subsidies from the government and proper planning by public officials, according to representatives of utility service providers.

In a forum last week organized by the Liveable Cities Philippines project, corporate officials said the impact of Typhoon Odette (international name: Rai) underscored the need to set up facilities that are more secure in the face of changing climate risks.

“Odette was a sobering experience for all of us. We recognize the gaps that need to be filled and acknowledge that there is much to be done,” said Anton Mari G. Perdices, senior vice-president and chief operating officer of Aboitiz Power Corp.

“Our goal now is to make sure that we build more resilient power systems moving forward,” he said.

Aboitiz Power’s distribution utilities operating in the major urban centers of Cebu and Davao — Visayan Electric Co., Inc. and Davao Light and Power Company, Inc. — have been transferring cables underground in small areas, mainly in busy downtown sections that are also usually used as parade routes during fiestas.

Mr. Perdices said these underground cabling projects were challenging not just in terms of the technical requirements on their part, but other considerations such as traffic management and a “robust” city planning.

“We’re open to discussions on expanding this project to more parts of our franchise areas,” he said, but multi-party mechanisms will have to be coordinated to make it commercially viable. “It will take a long time and a lot of money so there has to be some sort of government subsidy.”

Globe Telecoms, Inc. Communications Manager Rofil Sheldon F. Magto said it would be beneficial for utility companies to coordinate with local and National Government agencies.

“That’s a bit of a long-term discussion, but we hope that we are going in that direction together with other companies as well,” he said in the same forum.

Architect and urban planner Nathaniel von Einsiedel said building resilient infrastructure is an urban management issue that primarily rests upon local governments.

“It’s a matter of the LGU (local government unit) where the development is taking place, coming up with a system of requiring that kind of an approach, and putting in the mechanism for coordinating with the different utility companies in the actual implementation,” said Mr. Von Einsiedel, president of the Alliance for Safe, Sustainable and Resilient Environments (ASSURE).

ASSURE is a volunteer organization formed by various professionals in the aftermath of Typhoon Haiyan, locally named Yolanda, which struck central Philippines in 2013.

Implementation is the main problem, he said, particularly “synchronizing” the timetable of private companies and government agencies for the rollout.

Mr. Perdices said underground cabling — along with other solutions such as having embedded generation systems or as simple as ensuring trees are regularly trimmed to minimize the threat of toppling utility poles — are doable if stakeholders combine efforts.

“Collaboration is really the way to go,” he said.

Flag carrier PAL names new president, COO

PHILIPPINE Airlines, Inc. (PAL) announced on Monday that its senior vice-president for operations, Capt. Stanley K. Ng, has been appointed as the flag carrier’s new president and chief operating officer (COO), in an acting or officer-in-charge capacity, replacing Gilbert F. Santa Maria.

Mr. Ng, a son-in-law of billionaire Lucio C. Tan, will now oversee the flag carrier’s efforts to “maintain the momentum toward full recovery” following its recent Chapter 11 restructuring, the airline said in an e-mailed statement.

PAL said Mr. Ng is the first pilot to assume the presidency of the flag carrier since the early 1960s.

“He brings to the job a wealth of experience in the airline industry,” it noted.

Mr. Ng began his career with the airline as a member of the on-ground staff in 2003 before attending the PAL Aviation School.

He started flying as a second officer in 2008 and “rose up the ranks until he was promoted to senior vice-president in 2019 in charge of the airline’s internationally-respected pilots and cabin crew, as well as operational airport and engineering teams,” PAL said.

Citing industry sources, OneNews and The Philippine Star reported on Jan. 30 that Mr. Santa Maria was “stepping down” as president and COO of the flag carrier.

In its statement on Monday, PAL said Mr. Santa Maria had “completed his engagement with Philippine Airlines after successfully leading and completing the Chapter 11 process.”

“The Board expressed its gratitude to Mr. Santa Maria for his steady stewardship of the company over the last two and a half years,” the company said.

“The former president and COO will continue to make himself available to assist in the leadership transition over the next few weeks,” it added.

The airline has said that it aims to restore more routes and increase flight frequencies as travel restrictions ease and borders reopen, including the resumption of regular flights to multiple cities in mainland China, full regularization of flights to Australia and the commencement of new services to Israel.

PAL previously reported a loss of $11.67 million, or P582.65 million, for November 2021, three months after filing for Chapter 11 bankruptcy protection, resulting in a cumulative loss of $69.09 million, or P3.45 billion. The airline had a gross income of $143.48 million for the month.

The company anticipates to generate an operating income of $220 million this year and $364 million in 2023. — Arjay L. Balinbin

Malditas beat Chinese Taipei to secure place in World Cup

PHILIPPINE FOOTBALL FEDERATION

By Olmin Leyba

HELLO, world.

From a football minnow that dreamt big, the Philippines completed its amazing transformation into one of the world’s elite teams contending for football’s centerpiece prize.

Behind a gutsy performance that led to a thrilling 4-3 victory on penalties over Chinese-Taipei in Sunday night’s Asian Football Confederation (AFC) Women’s Asian Cup quarterfinals in Pune, India, the Philippines claimed its new status as a “World Cup nation.”

This famous triumph sent the history-making Filipina booters to the next staging of the FIFA Women’s World Cup — the stomping ground of global powers led by four-time winner USA, two-time champ Germany and 2011 title holder Japan — set 2023 in Australia and New Zealand.

“It’s an unbelievable achievement by the group and a moment in history for the country,” said coach Alen Stajčić after his charges advanced to the WAC semis and earned the distinction of being the first Philippine football side to qualify for the prestigious world meet.

“For now, every young kid back home in the Philippines can be inspired to get to the World Cup themselves.”

The brave Filipinas pulled off a memorable clincher that was celebrated with as much passion back home by supporters who stayed glued on the TV coverage until around 12 a.m.

The Taiwanese, who first forced a 1-1 stalemate with Zhou Li-Ping’s 82nd-minute equalizer, put the Pinay booters on the brink in the penalty shootout when they grabbed a 3-2 lead after the first four spot kicks.

Goalkeeper Olivia McDaniel, however, saved the day, coming through with two big-time stops plus the tying PK before forward Sarina Bolden wrapped it up with the golden goal.

“It was a make-or-break right then and you had to show up for the team. There’s nothing going through my mind except you’re going to make this save, you’re going to do this,” said Ms. McDaniel of her crucial save against Taipei’s fifth kicker, Su Sin-Yun, and designated PK taker in the sudden death, Zhou Li-Ping.

The celebrated triumph sustained the Filipinas’ assault on the record books in the WAC. Back in the group stage, McDaniel and Co. scored a 1-0 breakthrough against regular tormentor Thailand, had a fighting 4-0 loss to fancied Australia and routed Indonesia, 6-0, to reach the quarterfinals for the first time.

The 64th-ranked Filipinas can add to the growing feats by beating Korea in the semifinals on Thursday. The Koreans advanced at the expense of the Matildas, 1-0.

“I’m just running out of superlatives to describe what an amazing achievement this is. We’re able to compete and achieve in this kind of pressure against teams like Thailand who is (ranked 39) and Australia who is 11 and that just shows how far this group has grown,” said Mr. Stajčić.

UnionBank posts 9% increase in net profit

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UNIONBANK of the Philippines, Inc. recorded a higher net income in 2021 as revenues improved and its loan loss provisions declined.

The Aboitiz-led lender’s net profit rose by 9% year on year to P12.6 billion in 2021, it said in a filing with the local bourse on Monday.

Net interest income increased by 4% year on year to P29.8 billion in 2021. This was backed by its net interest margin, which improved by 9 basis points to 4.6% amid lower funding cost due to the increase in current account, savings account (CASA) deposits.

UnionBank’s total deposits increased by 8% to P570.5 billion as of end-2021, driven by the record 32% growth of CASA deposits to P341 billion.

Meanwhile, non-interest earnings increased by 14% to P15.3 billion, backed by higher fees, service charges, as well as foreign exchange gains, and trading income.

UnionBank’s loans and receivables rose by 6% year on year to P359.8 billion as of end-2021, while total assets grew by 7% to P831.1 billion.

The bank’s nonperforming loan ratio improved to 5% at end-2021 from 5.1% a year ago. It set aside loan loss provisions worth P5.8 billion in 2021, down by 31% from a year earlier.

“Our performance in 2021 gives us a good foundation for further growth in 2022. We expect a healthy expansion in our loan portfolio, steady margins from strong CASA growth, improving credit quality, and higher revenues across our business groups this year,” UnionBank Senior Executive Vice-President and Chief Financial Officer Jose Emmanuel U. Hilado was quoted as saying in the statement.

In December, UnionBank said it will buy the local retail unit of Citigroup, Inc. for P55 billion.

UnionBank also secured approval from the Bangko Sentral ng Pilipinas in July to operate a digital bank. This wholly owned subsidiary will be called Union Digital Bank which is on track for commercial launch by the middle of 2022, UnionBank President and Chief Executive Officer Edwin R. Bautista said.

“Together with our digital initiatives, our top priority in 2022 is the smooth transition and migration of Citi’s consumer banking business. We are committed to uphold Citi’s superior customer experience and provide a new home for all Citi employees in UnionBank,” Mr. Bautista said.

The Aboitiz-led lender’s shares closed at P100.60 apiece on Monday, up by P2.90 or 2.97% from its previous finish. — L.W.T. Noble

BPI net income climbs 11.5% in 2021

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BANK OF THE Philippine Islands (BPI) booked a P23.88-billion net profit in 2021 as the decline in its loan loss buffers and higher fee income offset lower interest earnings.

The bank’s net income was up by 11.5% from a year earlier, it said in a filing with the local bourse on Monday.

This translated to a return on equity of 8.4%, while return on assets stood at 1.1%.

For the fourth quarter alone, BPI’s net income improved by 51.2% year on year to P6.4 billion, the bank said.

BPI’s net interest income in 2021 fell by 3.7% year on year to P69.58 billion from P72.3 billion. This was dragged by its net interest margin, which dropped by 19 basis points to 3.3% due to lower yields across most loan portfolios and treasury assets.

Meanwhile, non-interest income decreased by 5.5% year on year to P27.82 billion in 2021. This, as the 23.2% rise in fee earnings could not offset the decline in trading income.

BPI’s revenues dropped by 4.2% year on year to P97.4 billion in 2021.

On the other hand, the bank’s operating expenses rose by 5.4% to P50.73 billion from a year earlier amid higher technology cost. This brought its cost-to-income ratio to 52.1%.

Total loans rose by 4.9% year on year to P1.48 trillion as of end-2021, backed by growth in mortgage, credit card, and microfinance credit.

BPI’s nonperforming loan (NPL) ratio improved to 2.49% as of end-2021 from 2.68%, while NPL coverage ratio rose to 136.1% from 115.2% a year earlier. The bank’s loan loss provisions dropped by 53.1% to P13.13 billion from P28 billion in 2020.

Meanwhile, the bank’s deposits rose by 13.9% to P1.96 trillion as of end-2021, boosted by the increase in its current account, savings account (CASA) (10.3%) and time deposits (28.2%). BPI’s CASA ratio stood at 77%, while loan-to-deposit ratio was at 52.1%.

BPI’s assets increased by 8.4% year on year to P2.42 trillion, while total equity stood at P293.06 billion as of end-2021.

The bank’s common equity Tier 1 ratio was at 15.8%, while its capital adequacy ratio stood at 16.7%, which are both above minimum regulatory requirements.

BONDS
Meanwhile, BPI raised P27 billion in fresh funds through its bond offering, where proceeds will be used to fund its corporate needs and refinance its debt.

The papers were oversubscribed by five times versus the initial target issue size of P5 billion, the bank said in a separate filing with the local bourse on Monday.

The papers have a tenor of two years and an interest rate of 2.8068% per annum which will be paid quarterly.

BPI ended the offer period for the bonds a week earlier than the original schedule amid the high demand.

BPI Treasurer Dino R. Gasmen earlier said that proceeds from the issuance will fund the bank’s general corporate needs as well as debt refinancing, while a part will be used to boost BPI’s digitalization.

The issuance is the fourth tranche under BPI’s P100-billion bond program.

The bonds were sold for a minimum investment of P1 million and increments of P100,000 thereafter.

BPI Capital Corp. and The Hongkong and Shanghai Banking Corp. (HSBC) were the joint lead arrangers for the offering. BPI Capital served as the selling agent for the bonds, while HSBC was a participating selling agent.

BPI shares closed at P98.10 apiece on Monday, down by P1.20 or 1.21% from its previous finish. — Luz Wendy T. Noble

Office leasing activity to remain subdued

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INFORMATION technology-business process management (IT-BPM) firms are expected to drive demand for office spaces this year, although overall office leasing activity is likely to remain subdued in the first half of 2022, JLL Philippines said.

“For the office market, we’re seeing signs of market stability. For Q4 2021, what we saw was a moderate take-up of 75,713 square meters (sq.m.) in gross leasing volumes,” JLL Philippines Head of Research and Consulting Janlo C. de los Reyes said in a briefing last week.

While lower than previous quarters, Mr. De los Reyes noted sentiment has improved.

IT-BPM companies were the key office market drivers in the fourth quarter and accounted for 62.5% of the overall office take-up in 2021.

However, the work-from-home guidelines implemented by the Philippine Economic Zone Authority (PEZA) for ecozone locators may curb the IT-BPM sector’s expansion this year.

“A lot of the IT-BPM occupiers have deferred their dealing decisions until they have clarity with regard to the guidelines set by PEZA… In the third quarter of last year, we saw pick-up in terms inquiries by a lot of the IT-BPM companies as they are waiting on the PEZA moratorium decisions. And with that being deferred to March 2022, we saw leasing activity go down,” Mr. De los Reyes said.

The Fiscal Incentives Review Board extended the remote work arrangements for IT-BPM firms located within PEZA ecozones until end-March. Under the guidelines, outsourcing firms are allowed to have most of their workforce at home until March but they must have 10% of their employees on site.

“We do expect the same narrative for this coming March. We do think that the PEZA may further extend the moratorium given the Omicron variant as well as the market performance over the next coming months,” Mr. De los Reyes said.

He noted many occupiers are now embracing a hybrid work model, “meaning they’re open to having a percentage of their workforce work remotely.”

Also, the upcoming May elections may dampen office leasing activity at least within the first half.

“We might see leasing activity slowdown as more investors as well as occupiers postpone their leasing decisions as they wait and see whether policies might change in relation to their portfolio and investment decision,” Mr. De los Reyes said.

Aside from IT-BPM sector, technology, e-commerce, and logistics companies are also expected to fuel office space demand this year.

Philippine Offshore Gaming Operators (POGOs), which drove the office market pre-pandemic, are anticipated to make a comeback.

“I think POGOs may return but definitely not the same size as the previous period. I think what we may see that there is also a bit of apprehension from landlords,” Mr. De los Reyes said.

Meanwhile, JLL Philippines said newly built real estate spaces is expected to “exert pressure on real estate recovery,” as this would dampen the market in the short term as demand would not support supply.

The property services firm expects 838,000 sq.m. of new office spaces, retail expansion of 497,000 sq.m., 23,000 sq.m. of new residential spaces, and 7,000 sq.m. for the hospitality sector.

“Everyone was looking at 2021 as the recovery year for the market, but I think it was still part of our journey to recovery. We do expect the same story for 2022, but definitely, there are signs that are pointing at improved movement with regard to the real estate market for this year,” Mr. De los Reyes said. — K.C.G.Valmonte

PHL AirAsia says domestic travel picked up in January

NEWSROOM.AIRASIA.COM

DOMESTIC travel picked up in January despite the surge in coronavirus cases, low-cost carrier Philippines AirAsia, Inc. said on Monday.

The airline reported a 182% increase in domestic travel for the month of January.

“The uptick in [coronavirus] cases in January has not affected domestic travel as the airline recouped 42% of its pre-COVID flight frequency this month,” the low-cost carrier said in an e-mailed statement.

“Seats sold for said month also increased by 200% as compared to the same month in the previous year. Moreover, load factor has increased by 10%,” it added.

The airline noted that Caticlan, Cebu and Tacloban remained the top destinations for both leisure and essential travels.

The low-cost carrier has also started gradually increasing its domestic flights slated for February for Davao, Iloilo, Cagayan De Oro, Bacolod, Puerto Princesa, Panglao and Kalibo “in preparation for a possible influx of travelers.”

The airline previously said, citing its own survey, that seven out of 10 Filipinos are still keen on pushing through with their planned air travel in the next nine months despite the rising coronavirus cases.

Philippines AirAsia Chief Executive Officer Ricardo P. Isla said that the airline has observed an increase in Filipinos’ confidence to travel as the country gains “a better understanding of the pandemic” and develops “a more fitting culture of safety and vigilance.” — Arjay L. Balinbin

Tolentino commends Malditas for booking World Cup berth

PHILIPPINE Olympic Committee (POC) president Abraham Tolentino on Monday lauded the national women’s football team for booking a historic stint in the FIFA Women’s World Cup.

“The POC congratulates our women’s football team for making world football history,” said Mr. Tolentino a day after the Filipinas shocked Chinese Taipei, 4-3, in a pulsating penalty shootout at the Shree Shiv Chhatrapati Sports Complex in Pune, India on Sunday night.

The effort also sealed the National lady booters a berth to the Asian Football Confederation Women’s Asia Cup, which was another breakthrough feat.

“We won our first-ever Olympic gold medal in Tokyo last July — adding two silvers and one bronze — and then this in football,” said the congressman from Tagaytay and PhilCycling chief.

“Filipino athletes have been leveling up and are putting the country prominently on the world sporting map,” he added

Mr. Tolentino also praised the Philippine Football Federation (PFF) under president Mariano “Nonong” Araneta and secretary-general Edwin Gastanes for having accomplished what looked like an “impossible dream,” noting that “we are not a football-loving nation,” he said.

“These two gentlemen of sports have painstakingly brought Philippine football up there, not to mention that they hold or held sensitive positions in the POC,” said Mr. Tolentino, referring to Mr. Araneta who was chef de mission to the Tokyo Olympics where weightlifter Hidilyn F. Diaz won gold and boxers Carlo Paalam and Nesthy A. Petecio clinched silvers and Eumir Felix D. Marcial bagged bronze. — Joey Villar

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