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Dilemma of pre-need plan holders

Risk is the possibility of a loss due to an uncertain event that may occur in the future. It includes the probability of the event as well as the severity of the impact. One cannot predict with precision how events will turn out despite all due diligence. This calls for active preparation. A major risk management tool is insurance as a protection for the unknown.

Rehabilitation Philippines

As the government looks for measures that will allow the country to build up from the economic debacle brought about by the COVID-19 pandemic, the message of former President Manuel Roxas comes to mind. Allow me to share the statement of President Roxas on signing the Rehabilitation Finance Corporation (RFC) legislation on Oct. 29, 1946.

Hindsight is 2020

I have looked forward to 2020 for about three years as it was my forecasted early retirement year. For someone who has been in the work force for around four decades, idea of letting go and taking care of a travel bucket list was enthralling. My plans were meticulous to include advance airfare and hotel bookings to ensure cost savings. Likewise, in a number of cases, the reservations were on a confirmed and nonrefundable basis.

Small business relief amidst COVID-19

More than any other time in the history of the world, small businesses will need the support of the government. In general, most small businesses are enterprises that survive on recent sales in order to move forward as an ongoing concern. The business model depends on recurring transactions. With the lockdown in place, and people prohibited from moving about, it is the small neighborhood business that immediately suffers.

Family lending

Seventeen years ago, I wrote about the concept of “Family Loans”, inspired by Robert Merton and Zvi Bodie in their innovative text Finance. Whenever I raise the issue in my Finance classes, I realize the concept can benefit today’s millennials. Allow me to revisit the same topic.

Bridging the generation gap

Baby Boomers versus Millennials. This has been a trending topic lately from print to internet to social media. Ironically speaking, while there’s a miscommunication between these two generations, majority of the millennials are children born and raised by my fellow boomers.

Eulogy Virtues

“A good name is better than fine perfume, and the day of death better than the day of birth.” -- Ecclesiastes 7:1

Bank versus market-based financial systems

A balanced and developed finance system will have both well functioning financial intermediaries and market based institutions contributing to the economy’s growth. This is achieved through several channels: (1) acquisition on information about firms; (2) provision of risk-reducing arrangements; (3) pooling of capital; and (4) ease of making transactions. Information gathering is key to monitor the efficiency and productivity of projects. The system increases the pool of available funds and hedging of risks lead to better allocation to productive uses of funds mobilized from savers. With good governance, the financial systems can help to retain domestic savings at home.

Development, the family and technology

For this column, I will share a vision of family welfare and productivity that was penned some thirty (30) years ago in the crafting of a strategic vision for the then newly reformed Development Bank of the Philippines. I believe it is a yardstick that can be applied to any organization wanting to serve the cause of development. However, the yardstick is now confronted with new hurdles.

Principles for Responsible Banking

Modern banks play two important roles in the financial system. One, they are at the heart of the clearing and payment system so that transactions are consummated as seamlessly as possible. Two, they are major intermediaries in the reallocation of money or credit from those with excess of funds, the savers, to those with needs or opportunities, the borrowers. Banks make money from spreads or margins as well as from fee business. Traditionally, banks who are able to handle the functions well and efficiently are able to make a lot of money for their main profit objective.

Purpose Driven Chemistry

THE Academe-Industry-Government (IAG) triangle has been touted and proven to be a very good model for progress especially in research. Academe has the intellectual power, industry produces, while government provides policies and funds.

Walking the talk

Dr. Jesus Estanislao of the Institute of Corporate Directors once graced a governance forum at the Development Bank of the Philippines (DBP) where he extolled the values of integrity, fairness and accountability in all that we do. Being a development bank, he asked DBP to remember they work not just for the themselves and the institution but for a larger community, not just for today but for the future.

Management theories in flux

My Asian Institute of Management-Master in Business Management alumni class has a very active Viber group and recently our exchange revolved around the debate on whether new management theory has been discovered. One view says that management theory hasn’t really changed in the past 50 years, except that framing of the theory has progressed in the elusive search for the winning management formula. This has given birth to an industry of best selling books written by experts claiming to have discovered the immutable laws of management and leadership.

The many facets of development

DEVELOPMENT means different things to different people in different places, at different times. In broad terms however, development is progress, a change from one state to a better state. But not any change qualifies as development. Change must be reasonably rapid, visible and substantive. It must be capable of being measured, quantitatively or qualitatively.

The need to own cars

WHENEVER I do my spiel about the product offerings of the Development Bank of the Philippines (DBP), I highlight our aversion to providing car loans. In jest, I say we do not want to add to the traffic problem, especially in urban cities. Clearly, car financing is a staple of the private banking sector and it does not make development and economic sense for DBP to put its hat in the circle, even if the numbers will indicate it is probably one of the more lucrative banking/finance segments.

Integrity is forever

In the last episode of the Game of Thrones’ penultimate season, Cersei demands that Jon Snow remains neutral between the queens, but Jon affirms he has already sworn himself to Daenerys. This led to initial collapse of the talks. Jon was asked why he could not lie to achieve the negotiation’s objective. And Jon Snow responds about the importance of honesty and integrity.

Strengthening the middle office

THE middle child syndrome is a psychological condition among children born in the middle who feel left out. The first-born received privileges and the...

Permanent income

RETIRING after all those years of hard work is something to look forward to, but how can you be so sure that your financial situation is ready for it? Reality bites. Retirement planning is a financial necessity that should commence as soon as one finds some stability in his chosen career.

Food safety

MY BROTHER Bong has just returned from the USA and immediately he made sure he had a fill of the many Filipino food that he has missed. After just a few weeks, he complained of stomach sickness which led to a discussion on comparative food safety practices.

Intrinsic value

Buy when the price is low. Sell when the price is high. This is the prescription given to those who are interested to invest in the stock market. But the underlying question is: when is it low or high? Fundamental analysts will prescribe comparing observed price versus intrinsic value. If the intrinsic value is higher than the price, buy the stock. If it is less, sell it. And if it is equal to price, hold it.

Addressing disaster and climate risk in the financial system

ANOTHER storm is coming our way. Fortunately, we seemed to have learned our lessons as government leads the way in taking the necessary steps to be ready for whatever the typhoon will bring about. Allow me to share the Development Bank of the Philippines (DBP) journey in disaster and climate risk management as one of the government financial institutions (GFI) in the country.

Money and our faith

ACCORDING to Greg Laurie, money is a very important topic in the bible. It is the subject of nearly half of the parables of Jesus Christ. It is covered in one out of every seven verses in the New Testament. The Bible offers 500 verses on prayer, fewer than 500 verses on faith and more than 2000 verses on money. And 15% of everything Jesus taught was on the topic of money and possessions — more than his teachings on heaven and hell combined.

Human resources development and sustainability

ACCORDING to the United Nations Environment Programme-Finance Initiative (UNEP-FI), a sustainable bank is one that not only understands and manages the risks that arise because of sustainability issues, but also perceives the strategic dimension of these issues. This means thinking ahead about business implications and opportunities brought about by the increasingly pervasive environmental, social and developmental challenges of our time. Sustainability encompasses the business role in balancing environmental and social (human rights and labor) issues with economic issues. And sustainable development is defined as development that meets the needs of the present without compromising the ability of future generation to meet their own needs.

Mandated lending concerns

Nestor V. Tan, BDO Unibank, Inc. president, gave a very incisive talk to the FINEX general membership recently on the state of the banking...

Sustainable business: transcending CSR theaters

Recent developments across the globe have tested companies in a number of ways. Corporate citizenship, philanthropy and social innovation have been swiftly thrust into...

The Merits of Index Fund Investing

Whenever friends or students ask for advice about investing in the stock market, I always point to pooled funds as the preferred entry strategy...

Good governance for SMEs

As a practitioner dealing with small to medium (SME) enterprises with great business models or ideas for their ventures, it is very clear that...

When government programs work

For this column, I want to share with readers the performance of a small fund, the Industrial Guarantee and Loan Fund (IGLF), which has...