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Death creeps at door of error-plagued Philippine justice system

By Arjay L. Balinbin
Reporter

IN A FEW DAYS, 49-year-old Jun Allego will walk free after spending more than half of his life in jail.

Convicted of robbery with homicide, his 40-year sentence came down to 26 years for good conduct — while in prison, he became a student and teacher, taught karate and was a leader to his fellow inmates.

“His mother and father died while he was in jail and he never got to visit the wake of his brother,” Nene, his 57-year-old wife, said in a July 3 interview.

“He wants to come home on his own so he wants me to give him the key to the house,” she said, trying to hide her excitement.

“He wants to surprise me and our two daughters — they were both ‘made’ in jail — so I told him ‘It’s up to you, but remember that the dogs don’t know you.’”

While the Philippines, which is predominantly Catholic, had the death penalty back then, a moratorium on state killings had been put in place so Mr. Allego didn’t have to worry about dying.

Capital punishment was revived for about a year starting in 1999, only to be suspended again by then President Joseph E. Estrada.

His successor, Gloria Macapagal Arroyo, continued the practice, and in 2006 the country abolished the death penalty through a law. Before that, she cut the death sentences of 1,230 inmates to life imprisonment, which Amnesty International said was the “largest ever commutation of death sentences.”

That’s about to change if President Rodrigo R. Duterte will have his way.

The tough-talking leader has asked Congress to revive capital punishment for drug trafficking, plunder and other heinous crimes.

Several bills in both houses of Congress will soon be tabled for hearings.

Restoring capital punishment is certain given the sheer number of Mr. Duterte’s political allies in both the Senate and House of Representatives, Louie C. Montemar, a sociology professor from the Polytechnic University of the Philippines, said in an e-mail.

“Let us remember that the death penalty used to be with us despite opposition by the Catholic Church,” he said.

There is also strong public opinion for its return so “I really do not see anything beyond a massive civil society movement against it that could turn the tide.”

International rights groups warned that restoring capital punishment might tarnish the Philippines’ global image and affect trade and investments.

The European Union is reluctant to engage in deeper trade talks with the Philippines because it does not want to be associated with Mr. Duterte’s bloody war on drugs, said Phil Robertson, deputy director at Human Rights Watch Asia.

He also said Filipinos criticize the judicial system for its failures “so it’s hard to see why anyone would want to place issues of life and death in that system’s hands.”

“Research from all over the world shows that the death penalty does not serve as an effective deterrent to crime but it does undermine whatever remaining confidence exists in the Judiciary,” he added.

The Supreme Court in a 2004 decision admitted that out of 907 capital punishment appeals elevated to it for automatic review, 72% or 651 people in death row were saved from lethal injection after their wrongful conviction.

Amnesty International said the risks of judicial error are “almost certain” especially with reports of police planting evidence and using torture to get confessions from suspected criminals.

The death penalty continues to be applied inconsistently, with the poor suffering the most, AI human rights officer Wilnor Papa said. “This includes limited access to legal representation or being at a greater disadvantage in their experience of the criminal justice system.”

But Dante L. Jimenez, who heads the Volunteers Against Crime and Corruption, argued that capital punishment would deter politicians from stealing money and common people from committing heinous crimes.

“Capital punishment is the solution so that people will not take the law into their own hands,” Mr. Jimenez, whose brother was murdered in 1990, said. “What will you do as a parent if your daughter was raped and thrown like garbage?”

“My message to the church is focus on spiritual advice and do not meddle in state initiatives because that is wrong,” he said.

Nene, mentioned at the outset, thanks the government for giving her husband a second chance. “I am deeply thankful that there was no death penalty back then,” she said. “Jun will have a chance to see the light and will be turning over a new leaf. He’s a better person now since he came to know God.”

JG Summit doubles profit in 2nd quarter

JG SUMMIT Holdings, Inc. doubled its earnings in the second quarter as its airline, real estate and banking units registered double-digit growth.

In a regulatory filing, the Gokongwei-led holding firm said its attributable profit soared 99% to P9.96 billion in the three months ending June from P5 billion during the same period in 2018.

Consolidated revenues jumped 11% to P82.18 billion in the second quarter, coming mostly from its food business.

The food business, through Universal Robina Corp. (URC), generated P33.72 billion in revenues, up 3% — driven by the sustained growth of its branded consumer foods and agro-industrial segments.

The airline segment, represented by budget carrier Cebu Air, Inc., contributed P23.53 billion in revenues. The 20% increase was attributed to larger passenger volume and an increase in average fares.

The company’s real estate and hotel business, through Robinsons Land Corp. (RLC) added P7.98 billion in revenues, 19% higher than a year ago as it opened new malls.

Revenues from the banking segment, under Robinsons Bank Corp., surged 45% to P2 billion during the quarter due to higher interest income from finance receivables, commission income and trading gains.

The petrochemicals group, however, recorded a 16% decline to P9.01 billion in the three-month period. This represents the earnings of JG Summit Petrochemicals Corp. and JG Summit Olefins Corp., which were impacted by lower selling prices and volumes sold during the period.

For the first half, JG Summit posted an attributable net income of P17.4 billion, 77% up year on year.

“Increase is mainly due to the double-digit income growth in our airline and real estate businesses coupled by the foreign exchange translation gains and increase in equity in net earnings of associates particularly from United Industrial Corporation Limited (UIC),” the company said.

Consolidated revenues stood at P158.44 billion, a 10% increase from a year ago.

URC posted a 6% revenue growth to P67.04 billion, while Cebu Air’s revenues increased 18% to P44.7 billion.

Revenues of RLC added P14.74 billion in the six-month period, up 13% from last year, while Robinsons Bank chipped in P3.89 billion to rise 43%.

Petrochemicals revenues slipped 12% to P18.58 billion in the first half of the year.

JG Summit is allocating P87.5 billion for capital expenditures this year, a bulk of which will be dedicated to the expansion of its petrochemical business. — Denise A. Valdez

DMCI income falls in 2nd quarter

EARNINGS of DMCI Holdings, Inc. fell by a fifth in the second quarter of 2019, weighed down by lower coal prices and higher replacement power costs.

In a statement issued Wednesday, the diversified engineering conglomerate said net income dropped 20% to P3.8 billion in the April to June period, after flattish growth in revenues to P24 billion.

For the first half, net income was down 22% to P6.7 billion on the back of P44 billion in revenues.

“We had a tough first half because of lower average selling price of coal, higher replacement power costs, provisions for project cost overruns, and lower average price for our lower grade nickel,” DMCI Holdings Chairman and President Isidro A. Consunji said in a statement.

Mr. Consunji said in a press briefing late Tuesday that the company incurred about P2.3 billion in replacement power costs for the first half, following the shutdown of Unit 1 of Sem-Calaca Power Corp. for rehabilitation works since December 2018. This is 213% higher than the P742 million in replacement power costs in the same period last year.

The company was further affected by an 18% decline in average selling prices of coal to P2,227 per metric ton (MT) versus P2,710 per MT last year.

“The redeeming factor was the volume of coal, which hit 7.9 million tons, the highest ever so it’s a historic high. The operational efficiencies increased,” Mr. Consunji said.

With the lower coal prices and higher replacement power costs, Semirara Mining and Power Corp. (SMPC) delivered a 26% decline in net income contribution to P3.4 billion. Without non-recurring items, SMPC’s core net income contribution was still down by 26% to P3.6 billion.

SMPC recognized one-time losses worth P334 million for the accelerated depreciation of Calaca Units 1 and 2 in 2018 and the net effect of the share in non-recurring items in 2019, as well as P156 million from a financial contract with Southwest Luzon Power Generation Corp.

It likewise realized a one-time gain of P102 million from money claim of Sem-Calaca against the Power Sector Assets and Liabilities Management Corp. as approved by the Commission on Audit.

Meanwhile, property unit DMCI Homes also reported a 36% drop in net earnings contribution to P1.2 billion due to the absence of the P715-million gain from the sale of land in 2018. Without this, core net income contributions from the unit rose 5% to P1.2 billion thanks to lower project development costs.

Construction firm D.M. Consunji, Inc.’s income share also shed 35% to P440 million to account for cost overruns.

Income share from off-grid energy supplier DMCI Power Corp. improved by 9% to P233 million on the back of higher energy sales to power cooperatives in Masbate, Palawan, and Oriental Mindoro.

For DMCI Mining, net income contribution went down by 22% to P173 million after it sold more lower-grade nickel at lower average selling price.

On the other hand, affiliate Maynilad Water Services, Inc contributed P1.1 billion, 16% higher year on year, due to higher billed volumes and tariff increases. — Arra B. Francia

Vista Land Q2 profit rises 10%

VISTA LAND & Lifescapes, Inc., the property firm led by the country’s richest man Manuel B. Villar, Jr., reported a 10% increase in earnings in the second quarter, thanks to sustained sales of its residential projects and higher leasing revenues.

In a regulatory filing on Wednesday, Vista Land said its net income attributable to equity holders of the parent company stood at P2.81 billion for the April to June period, up 10% from the P2.55 billion it posted a year ago.

Second-quarter revenues jumped 8% to P11.95 billion, driven by a 4% rise in real estate sales to P9.23 billion and a 14% increase in rental income to P1.81 billion.

At the same time, costs and expenses increased by 11% to P7.2 billion during the April to June period.

For the first half, Vista Land said its attributable profit jumped 11% to P5.7 billion, on the back of an 11% rise in consolidated revenues to P23.4 billion.

Real estate revenues went up 8% to P18 billion during the first six months of 2019, “primarily attributable to the increase in the overall completion rate of sold inventories of all its business units.”

“Our reservations sales grew 8% during the period to P41 billion, which is still majority OFWs and over 90% end-users. We remain optimistic for the industry given the sustained demand in our residential business as well as the continued growth of our leasing business propelled by the steady growth in the disposable income, Overseas Filipino remittances, sound Philippine macroeconomic fundamentals and continued infrastructure development around the country especially in areas outside Metro Manila, where we have a competitive advantage given our geographic reach,” Mr. Villar, Vista Land chairman, said in a statement.

Camella generated P7.2 billion in real estate revenues, up 27%, while Communities Philippines increased its sales by 23% to P8.7 billion and Crown Asia posted an 8% rise in sales to P582 million.

Rental income rose 16% to P3.6 billion due to additional gross floor area leased out and higher rental rates at its malls.

“We remain confident about the company’s prospects for the rest of the year as we continue to expand our rental spaces which complements our existing core and stable end-user housing business. The strong performance of our leasing business came from the addition of gross floor area as well as growth in leasing revenue from our existing assets. Our leasable spaces are mostly retail malls which limits our POGO (Philippine offshore gaming operator) exposure to about 2% of the company’s overall leasing portfolio,” Manuel Paolo A. Villar, president and CEO of Vista Land, said.

Vista Land launched projects with an estimated value of P16 billion during the first half.

AGI income up 4% to P8B in 1st half

ALLIANCE Global Group, Inc. (AGI) reported its attributable income rose 4% to P8.1 billion in the first half, driven by double-digit growth in revenues.

In a statement, AGI said its consolidated revenues jumped 15% to P82.8 billion, as all its major subsidiaries contributed to the “robust topline growth.”

These include its real estate development arm Megaworld Corp., gaming and leisure operator Travellers International Hotel Group, Inc., liquor subsidiary Emperador, Inc. and quick-service restaurants unit Golden Arches Development Corp. (GADC).

Megaworld saw a 16% rise in attributable profit to P8.3 billion. Consolidated revenues increased 18% to P31.7 billion after “sharp increases” in the contributions of its core operating segments, AGI said.

Travellers International, owner and operator of Resorts World Manila (RWM), reported its attributable net income was halved to P844.71 million, even as gross revenues surged 50% to P16.57 billion.

Emperador posted a net income attributable to the parent of P3.25 billion in the first half, up 2% year on year, following higher sales from its international business.

GADC, which holds the exclusive franchise to operate restaurants in the Philippines under the McDonald’s brand, reported a 1% increase in attributable net income to P751 million during the first half.

GADC’s sales revenues increased by 14% to P15.4 billion, “supported by a healthy same-store sales growth of 5.5% and its ongoing new store additions.”

The number of McDonald’s stores stood at 642 by end-June from 620 stores in end-2018. Of these stores, 77 are in the NXTGEN format, which is equipped with a multi-point service system.

“We believe the Group’s strong topline performance was achieved on the back of a highly favorable domestic economy which cushioned the impact of some challenges in the global market,” said Kevin L. Tan, AGI chief executive officer, in a statement.

“However, we note increasing cost pressures, some brought about by the very competitive environment, which have impacted on our margins. Despite this, we remain confident that the collective growth strategies we have put in place — largely through product and market diversification, international pursuits for our spirits business and our ongoing expansion projects — are sound and will soon bear fruit,” he added.

AGI, the investment holding firm of billionaire Andrew L. Tan, has not submitted its financial report for the second quarter.

On Wednesday, shares in AGI fell by 5.81% to P13.30 each. — V.V.Saulon

Yields on term deposits decline following BSP’s policy rate cut

By Mark T. Amoguis, Senior Researcher

YIELDS ON term deposits dropped further on Wednesday as demand increased after the policy rate cuts implemented by the central bank last week.

Bids for the term deposit facility (TDF) reached P137.141 billion on Wednesday from the P123.414 billion received last week, above the P100 billion which the Bangko Sentral ng Pilipinas (BSP) wanted to sell.

Broken down, bids for the eight-day papers totaled P51.252 billion, more than the offered P40 billion and higher than the P37.187 billion recorded last week for a P30-billion auction volume.

Banks asked for yields ranging from 4.25% to 4.55%, a narrower margin compared to last week’s 4.5-4.75%. Bids settled at 4.4389%, lower by 14.55 basis points (bps) from last week’s 4.5844%.

Meanwhile, demand for the 14-day notes amounted to P40.747 billion, above the P30 billion on offer but lower than the P44.427 billion reached last week.

Lenders sought returns ranging from 4.25% to 4.59%, lower than the 4.5-4.71% range last week. The average yield for the tenor stood at 4.4905%, shedding 12.71 bps from the 4.6176% seen last week.

The 28-day deposits were likewise oversubscribed as bids totaled P45.142 billion versus the P30 billion placed on the auction block. This week’s tenders were also higher than P41.8 billion logged previously, although this was for a P20-billion offering.

Accepted yields ranged between 4.25% and 4.6%, below the 4.5%-4.7% margin in the previous auction. The average yield settled at 4.4961%, down 10.72 bps from last week’s 4.6033%.

The TDF is the central bank’s main instrument to mop up excess cash in the financial system and to better guide market interest rates.

The central bank’s Monetary Board last week slashed policy rates by 25 bps. Current interest rates now range from 3.75% to 4.75%.

Markets are still waiting for an additional 25-bp cut this year, as previously signaled by BSP Governor Benjamin E. Diokno.

Meanwhile, the Monetary Board decided not to cut reserve requirement ratio (RRR) of banks last week.

Reserve quotas now stand at 16% for big banks and 6% for thrift banks following the last round of the 200-bp multiphased reduction in all RRRs last July 26.

The BSP chief said on Tuesday that the policy setting body will “pre-announce” its plans to slash banks’ RRR on a quarterly basis.

Cebu Pacific pins growth hopes on cargo business

By Denise A. Valdez, Reporter

CEBU PACIFIC operator Cebu Air, Inc. is looking to ramp up the expansion of its cargo business, banking on the continued growth of the logistics industry.

“The business plan is for the cargo side to grow faster than the overall passenger side. If we succeed in that, then of course, by definition, we will grow (cargo) to a bigger portion of the total (revenue) pie,” Alex B. Reyes, vice-president of Cebu Pacific’s cargo division, told reporters in the launch of its first all-cargo freighter Wednesday.

“We’re just responding to the demand in the market place. If we can supply it, then we’ll grow along with the demand in the market place,” he added.

The Gokongwei-led budget carrier draws its profits from three business segments: passenger, cargo and ancillary services. In the first half, revenues from the passenger segment grew 18% to P33.35 billion, from ancillary services by 23.8% to P8.52 billion, and from cargo by 7% to P2.84 billion.

Mr. Reyes said Cebu Pacific is optimistic on its cargo business, noting that the 7% revenue increase in the past six months shows its growth potential in the region.

He said despite the 5.4% decline in Asia-Pacific demand for air freight as of June — based on data from the International Air Transport Association (IATA) — Cebu Pacific was able to maintain its growth momentum during the period.

The company’s cargo business is still largely supported by the belly capacity of its Airbus fleet, but it is now exploring more opportunities, starting with all-cargo planes.

Cebu Pacific took delivery of its first all-cargo aircraft, a reconfigured passenger ATR 72-500, which it will start deploying next month. The next one is expected to arrive before yearend.

“The ATRs are supposed to supplement the total capacity that we have. But they’re still relatively small compared to the total network capacity,” Mr. Reyes said.

“The freighter is brand new to us in terms of operations. We don’t have experience yet operating an all-cargo aircraft. But this is the first step in that direction,” he added.

The ATRs will initially operate domestically, but the company aims to fly them within the region someday.

Cebu Pacific Vice-President for Commercial Planning Alexander G. Lao said the arrival of more Airbus planes and the operational launch of the ATRs in the remainder of the year prepares the company well for cargo expansion.

“The main portion of our cargo revenue business continues to be driven from the Airbus fleet, because that’s really a higher capacity aircraft in terms of both weight (and) volume, and the associated revenue with it,” he said.

“We believe that by the second half, we’ll actually grow much faster in terms of total seats and total flights than we did in the first half,” he added.

The new ATR freighter will fly out of Manila when it starts operations in September, but will be moved to the Sangley air base once it opens in November.

Cebu Air booked a net income of P7.14 billion in the first half of the year, up 116% due to an increased passenger volume and higher average fares.

Less than 10 banks looking to adjust ATM fees BSP

SOME BANKS are eyeing to adjust their interbank charges.

THE BANGKO SENTRAL ng Pilipinas (BSP) has received “below 10” applications from banks for adjustments of fees for transactions coursed through automated teller machines (ATM) after the moratorium on such tweaks was lifted last month, a senior official said on Wednesday.

During a press briefing on Wednesday, BSP Deputy Governor Chuchi G. Fonacier declined to identify the banks applying for fee adjustments in order to not preempt the evaluation process being conducted by the central bank.

“Para na ring preemptive kung magdi-disclose kami ng names. In the process kasi (It will be preemptive if we disclose any names because their applications are still being processed),” Ms. Fonacier said on the sidelines of the briefing.

“’Yung number naman na so far [na nag-apply] ano pa lang…low pa lang. (But the number of applications is still low) Below 10,” she said.

However, Ms. Fonacier, who is deputy governor of BSP’s Financial Supervision Sector, said some banks are applying to “minimally” hike their interbank charge — or the fee charged when a customer withdraws his/her money from a different bank’s ATM — while some want to reduce it.

“Prevailing” benchmark interbank fees range from P11 to P15, averaging at P13 per transaction, Vicente T. De Villa III, senior director and officer-in-charge at the BSP’s Financial Technology Subsector, said in the same briefing.

“I think it’s best to just take in mind the prevailing rate… Anything beyond those prevailing rates, that would be evaluated thoroughly,” Mr. De Villa said.

Ms. Fonacier said whatever fee adjustments “on a per-bank basis” that will be decided on by the central bank will be reasonable and market-based.

Only applications with the complete set documents will be evaluated. The evaluation process will take place immediately for 20 banking days, Mr. De Villa said.

Should the petitioning bank get its fee adjustment approved, implementation is another matter, Ms. Fonacier said.

“Since you’re implementing a new fee, your customers should be informed,” Ms. Fonancier said.

“Ang requirement kasi namin (Our requirement is) they need to also inform their customers. So depende kung paano yung communication plan nila. Kasi ‘yun ‘yung requirement ng BSP (So it’ll depend on the bank how they will communicate that with their clients, because that’s the BSP’s requirement),” she said.

As of end-March, there are 21,682 ATMs in the country, BSP data showed.

BSP Governor Benjamin E. Diokno on Tuesday said the lifting of the moratorium on ATM fee adjustments does not mean banks will adjust their charges immediately.

This comes amid a planned probe of the House committee on banks and financial intermediaries of the impending hike in fees for transactions coursed through the ATMs. — Mark T. Amoguis

ATI to be Lomography’s sole local distributor

By Bjorn Biel M. Beltran
Special Features Writer

IN A BID to develop the local analogue and experimental photography scene, Vienna-based alternative photography company Lomography announced that retail and business solutions firm Altitude Technologies Inc. (ATI) will become the brand’s sole official distributor in the Philippines.

In launching “The Future is Analogue” campaign on Aug. 2, the company announced that the partnership will allow Lomography products to be more accessible to local artists and retailers. The catalogue includes analogue and instant cameras like the Lomo Instant and Lomo LC-A+; signature films like the Color Negative series and LomoChrome Purple; and lenses, such as the recently released 55mm mirrorless Petzval Art lens.

Edgar Allan Alberto, general manager of Lomography Manila, told BusinessWorld that the deal with ATI will also seek to develop Lomography’s already-burgeoning community here in the Philippines through workshops and projects like “LomoWalks,” “LomoWalls,” and its “LomoAmigo” program, which features local Lomographers in the company’s official online magazine.

Established in 1992 by a group of Viennese students, the Lomographic Society International is a film photography movement that grew from the Lomo LC-A — a popular Russian camera in the 1980s.

The movement eventually developed into an international enterprise with over a million creative members, with the term “Lomography” becoming a commercial trademark of photography firm Lomographische AG. The company also has offices in countries like Hong Kong and Japan.

From what started as an online community on websites like Yahoo! in the early 2000s, the Manila Lomographic Society now boasts of an estimated 17,000 members. Mr. Alberto said throughout its history, much of Lomography’s growth has been organic attributable to word-of-mouth recommendations from film hobbyists and enthusiasts.

“We’d like to keep our growth organic,” he said. “We want our marketing to focus more on how our customers react to our products, projects, and events. We won’t shy away from advertisements, but not too much. Since we have a distributor now, Lomography will be widely available for retailers and ultimately for artists,” Mr. Alberto said.

“Lomography has actually always been here, except that it’s always been underground,” Maria Michaela Villareal, ATI’s brand manager for Lomography, said in an interview.

“We want to create this kind of Lomo culture where you can have fun with film, that you don’t necessarily have to be professional. The vision is for Lomography to be known. We feel like it has already created a strong community that created this love of film, analogue and instant cameras, and it still embodies that whole vintage feel.”

Moving forward, Mr. Alberto said that by making their products more accessible to local photographers, he hopes that the ideals and values of Lomography can help keep the film photography scene in the Philippines alive and thriving in the digital age.

“What you miss from shooting digital photos, you can take with film,” he said.

He added, “Our philosophy is very demographic. We don’t follow any norms. For professional photography standards, these are all mistakes for them. But for Lomographers, these are works of art. These are their lives, these mistakes are part of their memories. It’s something that people are passionate about. More than taking pictures, Lomography is a philosophy.”

Record cargo volumes push ATI earnings higher

THE Batangas Container Terminal handled more than 160,000 TEUs of cargo during the first semester of 2019.

EARNINGS of Asian Terminals, Inc. (ATI) jumped 26% in the second quarter as its Manila and Batangas ports handled record cargo volume.

The listed port operator said its attributable net income stood at P1.03 billion during the April to June period, driven by a 12% increase in revenues from port operations to P3.41 billion.

Excluding the government’s share in port operations, revenues in the second quarter went up 14% to P2.83 billion.

In the six months ending June, ATI’s attributable net income soared 53% to P2.14 billion. Revenues grew 24% to P7.04 billion due to the higher throughput recorded in its Manila South Harbor (MSH) and Batangas Container Terminal (BCT) operations.

Minus the government’s share in port operation revenues, ATI’s profit in the first half stood at P5.78 billion, up 24% from last year.

In a statement, ATI said it handled about 650,000 twenty-foot equivalent units (TEUs) of cargo at the MSH during the six-month period, up by more than 15% from last year. This sets a new record for the Manila terminal’s biggest midyear throughput.

In Batangas, the company said it handled more than 160,000 TEUs of cargo during first semester, surging more than 45% from a year ago. With the volume increase so far, ATI said BCT is expected to exceed its 2018 throughput of 250,000 TEUs.

The company attributes its higher cargo volumes during the six-month period to efforts to improve port efficiency.

“In February, ATI and major international shipping lines entered into a terminal and vessel resource sharing agreement…which since paved the way for the immediate evacuation of (empty containers) from Metro Manila and nearby environs,” it said.

“ATI also continuously transfers Customs-cleared overstaying boxes from MSH to its Sta. Mesa container yard… This has contributed to optimized yard space and overall terminal efficiency,” it added.

The company is investing $300 million (about P15.6 billion) for capital expenditures this year to fund the expansion of its port operations. — Denise A. Valdez

San Miguel officially awarded P734-billion Bulacan airport project

THE Department of Transportation (DoTr) on Wednesday officially issued the notice of award to San Miguel Holdings Corp. (SMHC) for its P734-billion Bulacan International Airport project.

With the notice of award, SMHC will now take charge of the airport project’s financing, design, construction, supply, completion, testing, commissioning, and operation and maintenance.

SMHC must now submit documentary requirements such as its performance bond and letters of credit from a bank to the DoTr Special Bids and Awards Committee within 20 days from receiving the notice of award.

The DoTr earlier said it expects the airport to begin construction by the fourth quarter of the year.

“Finally, we can push forward with the Bulacan International Airport… Once operational, this new airport will give connectivity options to our citizens,” Transportation Undersecretary for Planning Ruben S. Reinoso, Jr. said in the statement.

The Bulacan International Airport, also called New Manila International Airport, is positioned as an alternative to the Ninoy Aquino International Airport in Pasay City.

It will stand on a 2,500-hectare land in Bulacan, Bulacan, with four to six parallel runways, and will have an annual capacity of 100 million passengers.

The new airport is targeted for operations within four to six years. SMHC said earlier this week it is tapping three foreign firms for the design and build of the project: Groupe ADP (Aeroports de Paris), Meinhardt Group and Jacobs Engineering Group.

“What we hope to build is a long-term solution — a sustainable and world-class Philippine gateway with enough runways and facilities to meet current and future needs,” Ramon S. Ang, president and chief operating officer of SMHC parent San Miguel Corp., earlier said. — Denise A. Valdez

PNB seeks to double return on equity in 3 years

PHILIPPINE National Bank is looking to improve its return on equity.

PHILIPPINE National Bank (PNB) wants to double its return on equity (RoE) within three years as it plans to put more focus on consumer finance and upgrade its subsidiaries in the coming years.

In a media briefing late Tuesday, PNB President and CEO Jose Arnulfo A. Veloso said the bank wants to increase its RoE to seven percent by the end of 2019 and to 12% in a span of three years from the six percent recorded at end-June.

“Our CFO and head of strategy are confident that we can hit seven percent. Seven percent…by the end of the year. The highest in the industry is 10%… I know 10% is really a stretch but…as far as I’m concerned, I’m telling them 12% is your target, shoot for the stars and land on the moon,” Mr. Veloso told reporters in a mix of English and Filipino.

RoE is the ratio of net profit to average capital. It measures how much shareholders make for every peso they invested in a company.

PNB’s quarterly report said its RoE was at 6.04% in the second quarter, lower than the 8.89% posted in the same period last year and the 7.70% in December 2018.

PNB is also looking to improve the leasing businesses of its subsidiaries, with Mr. Veloso saying there is huge untapped potential in the sector.

“Now is the time where I’m also focusing on the subsidiaries. So naka-focus ako ngayon sa leasing, ang laki pala ng opportunity natin dito sa leasing di natin ginagawa… Ang daming pumapasok sa leasing na hindi nacu-cultivate (I’m now focused on leasing. There’s a huge opportunity there. Many enter the leasing business but fail to cultivate it),” he said.

Mr. Veloso said PNB focused on improving its communication strategies in the first quarter, while the second quarter revolved around “understanding the rest of the operations of the branches.”

He added that PNB is currently building a team focused on understanding data.

“Data is going to be an important part of how we can do our business altogether… The consumer finance business, if done scientifically, is actually a data-reading business disguised as a lending institution,” he explained.

The bank chief likewise said the lender will also focus on wealth management amid the growing number of Filipinos interested in savings accounts.

The bank posted a P2.067-billion net profit in the second quarter, lower than the P3.974 billion booked in the same period last year.

PNB shares closed at P47.85 apiece on Wednesday, up five centavos or 0.10%. — Beatrice M. Laforga

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