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Thursday, October 02, 2003
Philippine
central bank keeps policy interest rates steady
Philippines'
Tanduay files counterclaim charge against Ginebra San Miguel
Manila
shares close higher on bargain-hunting, Wall Street gains
INTERVIEW
- Philippines' Metrobank keeps 3.00 bln peso 2003 net profit goal
Philippines'
Metrobank says keeping 3.00 bln peso 2003 net profit goal
Manila
shares higher late on bargain-hunting after Wall Street rises
Philippine
Bureau of Customs Sept collection 8.402 bln pesos, below target
STOCKWATCH
- Philippines' PLDT sharply firmer on ADR gains, earnings outlook
Philippines'
Meralco to use internal funds to pay debt due Oct - report
Philippines'
Metrobank 'repackaging' sale of bad loans to Rabobank - report
Philippines'
BIR, BOC say Sept collections could be below targets
Philippine
central bank to cut 2004 current account surplus forecast
Philippines'
PLDT sees wireless subscribers exceeding 12 mln by year-end
Philippines
forms cabinet group to renegotiate open skies accord with US
Philippines'
Export and Industry Bank debuts on PSE
Philippines
Smart signs deal with AT&T to restore interconnection
Philippines'
Metrobank raises 130 mln usd via tier 2 bond issue
Philippine
exchange, Sun Life Asset Management tie up on mutual funds
Philippines'
Jollibee Foods to list additional 3,917 common shares tomorrow
Wednesday, October 01, 2003
US
concerned about JI presence in southern Philippines - envoy
Philippine
survey shows another drop in Arroyo's approval ratings
Manila
shares close lower on Moody's outlook downgrade, Wall St losses
Forex
- Philippine peso slightly firmer in quiet trade
STOCK
ALERT - Bank of Philippine Islands lower on foreign-selli
Philippines'
Vulcan Industrial and Mining seeks waiver of SEC penalty
Philippines'
SPI says PPM Ventures still keen on launching tender offer
Philippines'
Macroasia acquires Airport Specialists Services Corp
Easycall
Philippines' board approves capital restructuring to address deficit
Philippine
Aug M3 up 3.80 pct yr-on-yr vs 3.60 pct in July
Manila
shares outlook - Lower on Moody's downgrade, Wall St losses
British
firm LNM Holdings offers to revive Philippines' National Steel -report
Philippine
end-Aug M3 up 3.7 pct yr-on-yr vs 3.3 pct rise in July - report
Philippines
joins Bank for International Settlements
Philippines'
Negros Navigation to re-open Cebu port Oct 5
Philippine
armed forces downgrades alert level
Philippines'
Security Bank cash dividend 0.15 pesos per shr
ROUNDUP
- Philippine political risks prompt Moody's ratings outlook downgrade
Philippines'
Jollibee Foods board approves merger with wholly-owned units
Philippine
Treasury opens 1.0 bln peso tap facility for 5-yr bonds
Philippine
Treasury raises 3.0 bln pesos via 5-yr bond issue
Forex-
Philippine peso closes firmer; Moody's downgrade priced in
Six
Philippine banks rating outlooks revised to negative - Moody's - UPDATE
Philippines
not changing borrowing plans this yr despite Moody's move -Camacho
Waterfront
Philippines says offer to manage Cebu hotel in exploratory stage
| Philippine central bank keeps policy interest rates steady |
MANILA (AFX-ASIA) - The Monetary Board today voted unanimously to maintain the central bank's key overnight interest rates unchanged at 6.750 pct for borrowing and 9.000 pct for lending, citing the benign inflation environment and outlook. "In its assessment of the prevailing inflation environment and overall macroeconomic conditions, the Monetary Board was of the view that the current monetary policy stance remains supportive of the economy's growth path," central bank officer-in-charge Alberto Reyes said in a statement. He said the near-term outlook for inflation remains essentially unchanged since the last monetary policy meeting on Aug 28. "Over the policy horizon, price dynamics should remain benign with the average inflation for 2004 expected to track broadly the government's announced target of 4.00-5.00 pct," Reyes said. Year-on-year inflation likely rose 3.00-3.50 pct in September compared with the 3.00 pct rise in August due to higher food and oil prices, economists polled by AFX-Asia said. The National Statistics Office will release the September inflation data on Oct 6. The central bank expects the inflation rate at 3.00 pct year-on-on-year in September, while the National Economic Development Authority is looking at a range of 3.00-3.50 pct. The central bank sees the CPI rising 4.00-5.00 pct for the full year, lower than the government's targeted range of 4.50-5.50 pct, as private spending and credit demand are seen improving moderately. In the first eight months of the year, the inflation rate averaged 3.00 pct. Economic Planning Secretary Romulo Neri said the CPI would likely remain "broadly stable" for the rest of 2003, putting the full-year rate at the low-end of his 3.00-3.50 pct forecast. The Monetary Board's expectations of benign inflation are based on subdued improvements in aggregate demand, particularly credit demand, and soft labor market conditions, along with moderate influence of cost-push factors such as energy prices, Reyes said. But the outlook for inflation "still contains an undercurrent of risk in the form of possible adverse cost-side developments and adjustments in the foreign exchange market, which have a bearing on public expectations about future prices," Reyes noted. As such, he said the Monetary Board believes that the central bank's current policy stance should continue "to ensure the presence of adequate liquidity to support the growth in domestic demand." The stance should at the same time remain "sufficiently cautious to guard against price pressures that may emerge over the near term." The central bank has scheduled the next monthly policy review on Oct 23. edelacruz@afxasia.com |
| Philippines' Tanduay files counterclaim charge against Ginebra San Miguel |
MANILA (AFX-ASIA) - Tanduay Holdings said it has sued rival Ginebra San Miguel Inc in response to Ginebra's 100-mln peso civil infringement suit for the alleged copying of its popular gin product. Tanduay, in a disclosure to the stock exchange, said it has filed its "answer with compulsory counterclaim" before the regional trial court of Mandaluyong City. Tanduay said it indicated in its complaint damages and claims against Ginebra San Miguel, but did not elaborate. Newspaper reports said Tanduay has asked its rival for 112 mln pesos in damages and 50 mln in actual damages, resulting from a court order that stopped Tanduay from selling its Ginebra Kapitan gin product. Ginebra San Miguel alleged Tanduay's gin product violated an exclusive trademark which it has used in marketing and promoting products since 1949. Tanduay said the charges are baseless as Ginebra is a generic Spanish term. (1 usd = 54.737 pesos) afxmanila@afxasia.com |
| Manila shares close higher on bargain-hunting, Wall Street gains |
MANILA (AFX-ASIA) - Share prices closed higher, rebounding after four straight sessions of declines, on select bargain-hunting inspired by Wall Street's strong gains overnight, dealers said. Gains in Philippine Long Distance Telephone, which followed the overnight advance of its New York-listed American Depositary Receipts on the company's bullish earnings outlook, provided strong support to the market. The composite index closed up 9.78 points, or 0.76 pct, at 1,297.89 on volume of 168.23 mln shares valued at 309.87 mln pesos. It traded between 1, 296.04 and 1,303.88. In the broader market, gainers led losers 27 to 13, with 43 stocks unchanged. "The market closed in positive territory on two major factors. One, the market had seen losses in recent sessions on foreign selling and, two, the US market gained quite strongly last night," ATR Kim-Eng Securities research head Andrew Long said. He said Moody's Investors Services' outlook downgrade on the Philippines' foreign currency borrowing to negative from stable, due to growing political uncertainties ahead of next year's polls, has likely been discounted by the market. But while Long sees the gains as sustainable, given the fact that a number of stocks, including some blue chips, remain at low price levels, he said reports of weak government revenue collections are a concern and may undermine sentiment or limit any further upside. The Bureau of Internal Revenue and Bureau of Customs said their September collections could be below respective targets of 32.575 bln and 8.693 bln pesos, raising the possibility that the budget deficit for the month may have exceeded the ceiling. Preliminary figures show that customs collections for September amounted to 8.402 bln pesos, below target due to weak imports, said Customs commissioner Antonio Bernardo. The government's budget deficit stood at 113.50 bln pesos in the eight months to August, still below the ceiling of 127.50 bln. However, the deficit in August alone was 18.17 bln pesos, exceeding the 8. 11 bln ceiling as the government spent more to boost a slowing economy. It was the first time in five months that the deficit exceeded the monthly ceiling. Analysts said the local bourse's gains were limited as investors await more fresh positive leads and the release of third-quarter corporate earnings reports. Accord Capital Equities research consultant Ron Rodrigo, however, said investors are looking forward to the Manila visit of President George W Bush on Oct 18, which is seen strengthening relations between the Philippines and the US. PLDT was the most actively traded stock, closing 30.00 pesos higher at 670.00 on 128,240 shares. PLDT said yesterday it expects its mobile phone subscribers to exceed 12 mln by the end of the year and sees 2003 earnings being boosted by sustained gains in its wireless business. The stock's gains also followed recent declines. Globe Telecom rose 5.00 to 700.00 on 27,330 shares. Bank of the Philippine Islands extended its losses, closing down 0.50 at 41.00 on 867,000 shares. Manila Electric B, available to foreign investors, gained 0.75 to 23.25 on 1.25 mln shares, while Meralco A was up 0.50 at 15.00 on 877,700 shares. Meralco parent First Philippine Holdings rose 0.25 to 17.75 on 917,000 shares. Meralco will likely be able to pay debts of about 1.20 bln pesos maturing this month using internal funds, according to a newspaper report citing company president Jesus Francisco. Ayala Land was up 0.10 at 6.30 on 2.23 mln shares, while parent Ayala Corp was unchanged at 4.80. San Miguel B, open to foreigners, was down 0.50 at 62.50, while San Miguel was steady at 54.00. The all-shares index was up 5.52 points at 793.08. The commercial-industrial index gained 22.34 to 1,913.08, while property rose 1.05 to 570.86. Mining and oil were unchanged at 1,285.00 1.36, respectively. Banking and financial services shed 0.68 to 426.05. (1 usd = 54.74 pesos) edelacruz@afxasia.com |
| INTERVIEW - Philippines' Metrobank keeps 3.00 bln peso 2003 net profit goal |
---- by Cecille Yap ---- MANILA (AFX-ASIA) - Metropolitan Bank & Trust Co, the country's largest bank in terms of assets, is confident of meeting its 3.00 bln peso net profit goal for the year on the back of higher trading gains and a modest rise in interest earnings from loans and a growing remittance business. In an interview with AFX-Asia, Metrobank executive vice president and chief financial officer Alfredo Javellana II said the bank is considering disposing of more non-performing assets, in addition to the 16.00 bln pesos worth of bad loans it agreed to sell to an asset management company (AMC) last year. The bank reported a 2002 net profit of 2.51 bln pesos, compared with 2.12 bln a year earlier. "We are on track to meeting the annual target of 3.00 bln pesos... We would rather be more conservative than optimistic," Javellana said. However, he declined to comment on its third-quarter financial results, citing strict disclosure requirements of regulators. The bank has, so far, set aside 2.00 bln pesos in loan loss provisions, within a buffer of an additional 2.00-2.50 bln pesos for the year. Javellana said the bank is more likely to meet the lower end of its 5. 00-10.00 pct loan growth goal this year as credit demand has remained sluggish, while deposits are seen increasing 5.00-10.00 pct as the bank focuses on securing more low cost funds. Metrobank's non-performing loan ratio stood at 15.02 pct as of June from 14.98 pct in March. In nominal value, its bad debts totalled 31.11 bln pesos as of June, with general provisions for loans and other losses of 1.76 bln pesos and specific provisions of 19.10 bln. Javellana said Metrobank expects to get the central bank's approval soon for the sale of 16.00 bln pesos worth of assets to Asia Recovery Corp, the asset management company set up using investments Dutch bank Rabobank Nederland made. However, he said the bank may not be able "to avail of the incentives (provided under the law) because the transaction was established before the Special Purpose Vehicle Law was passed." The law, which provides the regulatory and legal framework for the buying and selling of banks' distressed assets at substantial discounts, was passed in January. The law also provided certain incentives for both the buyers and sellers of distressed assets to help the banking sector return to profitability, and, in the process, spur economic growth. "Right now, we would first like to see our first transaction approved before venturing into another one," Javellana said. Metrobank, which recently raised 130.00 mln usd through an international tier 2 bond issue, said the proceeds will be used to refinance an existing 100.00 mln usd tier 2 private placement that paid a 9.00 pct coupon. It will use the remaining 30.00 mln usd for other investments. The 10-year bonds, callable after five years, will pay a semi-annual coupon of 8.375 pct. "It just shows the strength of the issue. Inspite of Moody's downgrade of the outlook on sovereign and six banks, investors were not affected," Javellana said. He added raising tier 2 capital was a preferred option as tier 1 capital or common stock would be more expensive at this stage, given the depressed market, and would also dilute the equity of other shareholders. (1 usd = 54.711 pesos) cecille.yap@afxasia.com |
| Philippines' Metrobank says keeping 3.00 bln peso 2003 net profit goal |
MANILA (AFX-ASIA) - Metropolitan Bank & Trust Co, the country's largest bank in terms of assets, is confident of meeting its 3.00 bln peso net profit goal for the year on the back of higher trading gains and a modest rise in interest earnings from loans and a growing remittance business. Metrobank executive vice president and chief financial officer Alfredo Javellana II said the bank is considering disposing of more non-performing assets, in addition to the 16.00 bln pesos worth of bad loans it agreed to sell to an asset management company (AMC) last year. The bank reported a 2002 net profit of 2.51 bln pesos, compared with 2.12 bln a year earlier. "We are on track to meeting the annual target of 3.00 bln pesos... We would rather be more conservative than optimistic," Javellana said. However, he declined to comment on its third-quarter financial results, citing strict disclosure requirements of regulators. The bank has, so far, set aside 2.00 bln pesos in loan loss provisions, within a buffer of an additional 2.00-2.50 bln pesos for the year. Javellana said the bank is more likely to meet the lower end of its 5. 00-10.00 pct loan growth goal this year as credit demand has remained sluggish, while deposits are seen increasing 5.00-10.00 pct as the bank focuses on securing more low cost funds. (1 usd = 54.711 pesos) cecille.yap@afxasia.com |
| Manila shares higher late on bargain-hunting after Wall Street rises |
MANILA (AFX-ASIA) - Share prices were higher in late trade as bargain-hunters went back into the market after four straight sessions of losses, taking their cue from Wall Street's strong gains overnight, dealers said. The market was lifted mainly on gains in Philippine Long Distance Telephone, which followed the advance of its New York-listed American Depositary Receipts last night on the back of its bullish earnings outlook. At 11.14 am, the composite index was up 10.39 points, or 0.81 pct, at 1, 298.50 on volume of 137.16 mln shares valued at 191.68 mln pesos. It has so far traded between 1,296.07 and 1,303.88 points. In the broader market, gainers led losers 29 to eight, while 29 stocks were unchanged. "Bargain-hunters thought it's time to accumulate after Wall Street's sharp gains last night," Accord Capital Equities research consultant Ron Rodrigo said. He noted that the market has seen strong support at the 1,280 level. Wall Street gained strongly on the back of 3M's reaffirmation of its growth outlook and a better-than-expected economic report, dealers said. The local bourse's gains, however, have been limited as investors await more fresh positive leads and the release of third-quarter corporate earnings reports. Rodrigo, however, said investors are looking forward to the Manila visit of President George W Bush on Oct 18, which is seen strengthening relations between the Philippines and the US. PLDT has been top traded so far and up 25.00 pesos at 665.00 on 74,010 shares. Globe Telecom rose 10.00 to 705.00 on 18,950 shares. Manila Electric B, available to foreign investors, gained 0.50 to 23.00 on 976,900 shares, while Meralco A was unchanged at 14.50 on 450,200 shares. Meralco parent First Philippine Holdings rose 0.25 to 17.75 on 302,000 shares. Ayala Land was unchanged at 6.20, while parent Ayala Corp rose 0.05 to 4. 85. The all-shares index was up 6.09 points at 793.65. The commercial-industrial index gained 20.69 to 1,911.43, while property rose 0.75 to 570.56. Mining and oil were unchanged at 1,285.00 and 1.36, respectively. Banking and financial services rose 1.71 to 428.44. (1 usd = 54.75 pesos) edelacruz@afxasia.com |
| Philippine Bureau of Customs Sept collection 8.402 bln pesos, below target |
MANILA (AFX-ASIA) - Collections of the Bureau of Customs for September amounted to 8.402 bln pesos, slightly below the 8.693 bln target it had set for the month, preliminary figures from the agency show. Customs commissioner Antonio Bernardo had earlier blamed weak imports for the agency's lower revenues. Despite the lower-than-target collection for the month, the customs bureau said its January-September tally was still 6.0 pct or 4.424 bln pesos higher than its target for the period. No actual figure was provided. September collections were 3.3 pct or 291.000 mln pesos lower than the month's goal, but 3.6 pct or 295.00 mln pesos more than that collected last year, it added. "Importers held back their shipments largely due to the peso's fall. We have a very slim chance of meeting the goal, but we hope to trim down the shortfall. September was a very slow month," Bernardo said earlier. The government is maintaining its full-year deficit ceiling at 4.7 pct of GDP, or about 202.000 bln pesos. (1 usd = 54.72 pesos) cecille.yap@afxasia.com |
| STOCKWATCH - Philippines' PLDT sharply firmer on ADR gains, earnings outlook |
MANILA (AFX-ASIA) - Philippine Long Distance Telephone Co was sharply higher in early trade following strong gains in its New York-listed American Depositary Receipts, helped by a bullish earnings outlook, dealers said. PLDT said yesterday it expects its mobile phone subscribers to exceed 12 mln by the end of the year and sees 2003 earnings being boosted by sustained gains in its wireless business. The stock's gains also followed recent declines. At 10.30 am, PLDT was up 30.00 pesos at 670 on volume 51,950 shares. Its ADRs rose 0.45 usd to 12.25 last night. The composite index rose 10.77 points or 0.84 pct to 1,298.88. As of end-August, PLDT's wireless subscribers, including those of unit Smart Communications Inc and the Talk 'N Text brand of Pilipino Telephone Corp, exceeded 11.00 mln, up from about 10.30 mln at end-June. PLDT is maintaining its full-year net profit forecast of around 9.00 bln pesos on the assumption that it will sustain its earnings performance in the second half of the year. In 2002, net profit stood at 3.10 bln pesos. While some investors have priced in expectations of strong third quarter earnings due to gains in the wireless business, the market seems to be looking at the full-year prospects for PLDT, dealers said. Ron Rodrigo, a research consultant with Accord Capital Equties, said he is maintaining his full-year net profit forecast of 10 bln pesos for PLDT. "Continuing gains in the wireless business will boost PLDT's earnings this year," he said, adding that this outlook is also being priced into PLDT's ADRs. UBS Investment Research, in a recent report, said it has revised upward its 2003 net profit forecast for PLDT to 12.4 bln pesos from the initial projection of 12.1 bln. The adjustment was made to match the continued strong performance of Smart in terms of subscriber numbers and margins, it said. PLDT president and chief executive officer Manuel Pangilinan earlier said he did not expect the company to book any further significant one-off provisions in the second half. The company booked provisions worth 4.8 bln pesos in the first half, after which net profit was recorded at 1.8 bln. ING Financial Markets, in a research note, said it has raised its 12-month target price for PLDT to 780 pesos on expectations that it will be able to pay a cash dividend in 2005, aided by increased dividends from Smart. ING said it has upgraded its recommendation on PLDT to "buy" from "hold" as it forecasts the company to record an earnings per share growth of 8.00 pct this year and 9.00 pct in 2004, primarily due to Smart's gains. Adding a positive tone is the signing of an interim agreement between Smart and US carrier AT&T to resume services after settling a dispute over termination fees, dealers said. Smart said yesterday it would restore bilateral facilities while AT&T would settle all outstanding amounts and termination fees once the US Federal Communications Commission FCC lifts a stop-payment order against Smart. Smart said AT&T will also be granted direct inbound calls and access from the US to Smart's network. Interconnection between the two carriers was disrupted in February due to disputes between Philippine carriers and their US counterparts on termination fees. (1 usd = 54.70 pesos) edelacruz@afxasia.com |
| Philippines' Meralco to use internal funds to pay debt due Oct - report |
MANILA (AFX-ASIA) - Manila Electric Co will likely use internal funds to pay debts falling due this month, BusinessWorld newspaper reported, citing company president Jesus Francisco as saying. Meralco has about 1.2 bln pesos in debts maturing this month, the report said. "It looks like we will be able to pay it. It will likely be through internally generated funds, because I have not heard about us getting new loans," Francisco was quoted as saying. (1 usd = 54.78 pesos) afxmanila@afxasia.com |
| Philippines' Metrobank 'repackaging' sale of bad loans to Rabobank - report |
MANILA (AFX-ASIA) - Metropolitan Bank and Trust Co is "repackaging" the planned sale of its non-performing assets to an asset management company set up by Dutch bank Rabobank Nederland, the Philippine Star reported, citing unidentified sources. The report said Metrobank was seeking to polish the deal with Rabobank to be able to avail itself of incentives under the Special Purpose Asset Vehicle Law. The paper's sources said the changes in the sale plan would likely include adjustments in the contents of the bad loans portfolio to be unloaded and the actual value of the transaction. Metrobank earlier agreed to sell some of its bad assets worth about 16.0 bln pesos to Asia Recovery Corp, the AMC set up using investments made by Rabobank. (1 usd = 54.87 pesos) afxmanila@afxasia.com |
| Philippines' BIR, BOC say Sept collections could be below targets |
MANILA (AFX-ASIA) - The Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC) said their September collections could be below their respective targets of 32.575 bln and 8.693 bln pesos, raising the possibility that the budget deficit for the month may have exceeded the ceiling. Customs commissioner Antonio Bernardo blamed weak imports last month for the BOC's weak collections. "Importers held back their shipments largely due to the peso fall. We have a very slim chance of meeting the goal but we hope to trim down the shortfall. September was a very slow month," he said. BIR commissioner Guillermo Parayno said excise tax collections fell substantially due to the transition period adopted prior to the implementation of the new automotive taxation rules. Parayno also blamed weak collections from the large taxpayers' group. The government's budget deficit stood at 113.50 bln pesos in the eight months to August, still below the ceiling of 127.50 bln. However, the deficit in August alone was 18.17 bln pesos, exceeding the 8. 11 bln ceiling as the government spent more to boost to a slowing economy. The government is maintaining its full-year deficit ceiling at 4.70 pct of GDP or about 202.00 bln pesos. (1 usd = 54.78 pesos) afxmanila@afxasia.com |
| Philippine central bank to cut 2004 current account surplus forecast |
MANILA (AFX-ASIA) - The central bank is poised to cut its current account surplus forecast of 2.0 bln usd for 2004 after reducing this year's surplus target to 1.70 bln usd from 2.35 bln due to weak exports, central bank deputy governor Amando Tetangco said. The central bank's policy-making Monetary Board will meet today to affirm the revision in this year's current account surplus target, after which next year's assumption would be revised, he said. "Once the board firms up the 2003 numbers, we will be working on the 2004 targets. And most likely, there will be changes in the absolute numbers, (but) it won't be far away from the original numbers," he said. The Monetary Board will take into account the anticipated recovery of the US and Japanese economies. The central bank's revised 2003 current-account surplus target is based on a projected 3.00 pct growth in exports this year, lower than the previous assumption of 5.00 pct. However, it sees full-year imports growing 8.00 pct from last year, higher than its previous projection of 7.00 pct. The central bank said it is keeping its balance-of-payments (BOP) target at a deficit of 1.10 bln usd in 2003 and 1.20 bln surplus in 2004. Weak inflows resulted in a BOP deficit of 414.00 mln usd in August and 653.00 mln usd for January to August, the central bank said earlier. afxmanila@afxasia.com |
| Philippines' PLDT sees wireless subscribers exceeding 12 mln by year-end |
MANILA (AFX-ASIA) - Philippine Long Distance Telephone Co said it expects its mobile phone subscribers to exceed 12 mln by the end of the year. In a disclosure to the stock exchange, PLDT also said it is scheduled to announce its third quarter earnings, which it expects to be boosted by sustained gains in its wireless business, in the first week of November. As of end-August, PLDT's wireless subscribers, including those of unit Smart Communications Inc and the Talk 'N Text brand of Pilipino Telephone Corp, exceeded 11 mln, rising further from about 10.3 mln at end-June. Yesterday, PLDT vice president for media and corporate communications Butch Jimenez told AFX-Asia that the company's total wireless subscribers were "surging towards the 12 mln mark." He said PLDT expects continued "strong" growth in its wireless subscriber base to boost its third quarter to September net profit. PLDT earlier reported a net profit of 1.40 bln pesos in the third quarter of 2002. PLDT is optimistic it can meet its full-year net profit target of around 9.0 bln pesos despite huge one-off provisions in the first half. In 2002, net profit stood at 3.10 bln pesos. Earlier, PLDT president and chief executive officer Manuel Pangilinan said he did not expect PLDT to book significant one-off provisions in the second half. In today's disclosure, PLDT said its 9.0-bln peso profit forecast was based on the assumption that it would sustain its earnings performance in the second half of the year. "The profit guidance may vary to the extent that our assumptions could be affected by events and circumstances occurring during the balance of the year, " it said, without elaborating. (1 usd = 54.78 pesos) edelacruz@afxasia.com |
| Philippines forms cabinet group to renegotiate open skies accord with US |
MANILA (AFX-ASIA) - Philippine President Gloria Arroyo has ordered three cabinet members to renegotiate an "open skies" air services agreement with the United States which took effect today, Agence France-Presse reported. Foreign Secretary Blas Ople, Transport Secretary Leandro Mendoza and Tourism Secretary Richard Gordon have been given their "marching orders" to renegotiate the deal, presidential spokesman Ignacio Bunye said. Bunye would not say if the implementation of the agreement had been deferred or what new conditions the Philippines would be seeking, saying that he did not want to give away the position of the negotiating team. "The president precisely ordered the matter to be renegotiated. That means the president feels there are some things that need to be improved," he said without elaborating. Under a bilateral aviation pact signed in 1982, the two countries committed to an "open skies" policy that would remove frequency and capacity restrictions on passenger flights of each others' carriers from Oct 1, 2003. Manila fears putting the accord into effect this year would effectively sink its airlines, principally Philippine Airlines, and has been seeking a deferment. US ambassador to Manila Francis Ricciardone meanwhile denied allegations by local politicians and airlines that the United States was "pushing the Philippines" to adopt a full open skies policy. Documents issued by the US embassy stated that the air travel agreement would not wipe out local airlines as feared but would instead raise the volume of inter-Asian trade, result in greater savings for all airlines and ultimately benefit the consumer. |
| Philippines' Export and Industry Bank debuts on PSE |
MANILA (AFX-ASIA) - Export and Industry Bank debuted on the stock exchange today using the closed Urban Bank Inc as its backdoor listing vehicle. The stock, with trading symbol EIB, closed 0.44 pesos lower at 0.78 from the opening price of 1.22 that was set by the exchange, on volume of 1.64 mln shares. The symbol replaced Urban Bank's URB. Exportbank acquired Urban Bank, which declared a bank holiday and was later closed by the central bank in 2001. Trading of Urban Bank shares had been suspended since then. The exchange earlier said the bank was scheduled to list today 2.73 bln common shares with a par value of 1.00 peso each to cover the merger of Urban Bank and its investment house Urbancorp Investments Inc with Exportbank. Another 80,460 shares, covering partially-paid shares under the closed bank's management incentive plan, were also to be listed. In a statement today, Exportbank said that since the turnover of the Urban Bank group by receiver Philippine Deposit Insurance Corp, the merged bank had successfully completed the major components of the rehabilitation plan, including payments of deposit liabilities of Urban Bank. "The total payouts serviced to date now amount roughly to 10.1 bln pesos, all carried out by the bank ahead of schedule and without having to tap the standby funds made available by the PDIC, the central bank, and the Social Security System," Exportbank said. The bank said it had also managed to build its asset base to 27.71 bln pesos with a total capital of 4.44 bln, while maintaining profitable operations. The bank posted a net profit of 380 mln pesos in 2002 and expects to sustain profitability this year. The bank plans to open within the next four months 18 new branches nationwide to bring its total branch network to 50 by Jan 2004. (1 usd = 54.85 pesos) edelacruz@afxasia.com |
| Philippines Smart signs deal with AT&T to restore interconnection |
(Updating with quotes) MANILA (AFX-ASIA) - Smart Communications Inc said it has signed an interim agreement with AT&T to resume services after settling a dispute over termination fees. In a statement, Smart said it will restore bilateral facilities while AT&T settles all outstanding amounts and termination fees once the US Federal Communications Commission (FCC) lifts a stop-payment order against Smart. Smart did not specify the amount to be paid by AT&T. Smart said AT&T will also be granted direct inbound calls and access from the US to Smart's network. Interconnection between the two carriers was disrupted in February due to disputes between Philippine carriers and their US counterparts on termination fees. Philippine Long Distance Telephone Co, the parent of Smart, asked the FCC earlier this year to reverse the order suspending payments by US carriers to local carriers for processed inbound calls from the US. The FCC's decision was based on claims by the US carriers that PLDT and other local telcos were blocking calls from US carriers to force them to pay higher termination rates. The FCC has ordered US carriers to resume payments to Digital Telecommunications Philippines Inc and Bayan Telecommunication Inc. "I am proud to say that both the Philippine and US governments played a major role in resolving the commercial impasse between Smart and AT&T," said Rogelio Quevedo, head of Smart's carrier business group. "We have agreed to put aside our differences and came up with a win-win situation. AT&T knows that Smart is now the trendsetter in the Philippine telecommunications industry. Smart got what it wanted and AT&T also got an acceptable result in the interim." edelacruz@afxasia.com |
| Philippines' Metrobank raises 130 mln usd via tier 2 bond issue |
(Updating with company statement) MANILA (AFX-ASIA) - Metropolitan Bank and Trust Co said it has raised 130 mln usd through a tier 2 bond issue in the international capital markets. The 10-year bonds are callable after five years and have been listed in Singapore. They pay a semi-annual coupon of 8.375 pct and are rated "Ba1" by Moody's Investors Service. UBS Warburg is the sole bookrunner. In a statement, Metrobank said the proceeds would be used to refinance its existing 100 mln usd tier 2 private placement issued in 2001, which paid a 9.0 pct coupon. It said it originally intended to issue only 100 mln usd for refinancing purposes but decided to raise the amount to 130 mln usd after seeing overwhelming demand. The issue was more than two times oversubscribed even without a roadshow, the bank said. "The transaction was remarkable (as it allows) us significant cost savings by refinancing with a lower coupon and enhanced capital by extending the maturity of our tier 2," Metrobank president Antonio Abacan said in the statement. "Investors know us well and didn't require a face-to-face roadshow," said Metrobank chief finance officer Alfredo Javellana. Over 60 pct of the demand came from international institutional investors from Singapore, Hong Kong, Europe and Australia, Metrobank said. It said the oversubscription was notable given that Moody's has just revised the Philippines' long-term foreign currency rating outlook to negative from stable, on concerns over heightened political uncertainty ahead of next year's elections and the government's budget deficit. Moody's has also revised to negative from stable its rating outlooks on six Philippine banks, including Metrobank, Bank of the Philippine Islands, Philippine National Bank, Equitable PCI Bank, Development Bank of the Philippines and Land Bank of the Philippines. edelacruz@afxasia.com |
| Philippine exchange, Sun Life Asset Management tie up on mutual funds |
MANILA (AFX-ASIA) - Sun Life Asset Management Co, a unit of Sun Life of Canada (Philippines) Inc, said it has teamed up with the Philippine Stock Exchange (PSE) for the distribution of its mutual funds through stockbrokers. Sun Life Asset president Esther Tan told reporters that the tie-up enables the PSE to sell other forms of investment securities and at the same time helps widen the company's investor base. "In other countries, mutual funds have long been recognized as vital in the development of capital markets, the reason being that mutual funds have low initial investment requirements. They are affordable and give access to securities that at times are beyond the reach of average investors," Tan said. "I am very optimistic in the sense that this is an alternative. The equity market is in doldrums and any investment option is welcome. I believe a lot of funds are parked out there." Sun Life Asset manages four mutual funds in the Philippines, the Prosperity Bond Fund, Prosperity Balanced Fund, Prosperity Philippine Equity Fund and Prosperity Dollar Advantage Fund. The Securities and Exchange Commission has so far licensed 54 brokerage firms to distribute mutual funds. afxmanila@afxasia.com |
| Philippines' Jollibee Foods to list additional 3,917 common shares tomorrow |
MANILA (AFX-ASIA) - Jollibee Foods will list an additional 3,917 common shares tomorrow to cover its Tandem Stock Purchase and Option Plan. Jollibee closed today down 0.25 pesos at 17.25. (1 usd = 54.85 pesos) afxmanila@afxasia.com |
| US concerned about JI presence in southern Philippines - envoy |
MANILA (AFX-ASIA) - US ambassador to Manila Francis Ricciardone said his government had established that the Jemaah Islamiyah (JI) militant network may have cells in southern Mindanao island, Agence France-Presse reported. Ricciardone declined to give further details on the JI network in the south, but stressed his government has not received any "specific" threat against US President George W Bush, who is set to visit Manila on Oct 18. He said Washington was "particularly concerned about the continuing presence in Mindanao" of JI, which has been blamed for the bombings in Bali, Indonesia that left more than 200 people dead. |
| Philippine survey shows another drop in Arroyo's approval ratings |
MANILA (AFX-ASIA) - Approval ratings for President Gloria Arroyo fell once more amid opposition charges of corruption against her family, according to survey results released today. It was the second time in a month for Arroyo's ratings to fall in an independent poll. The latest survey conducted from Aug 30-Sept 14 by the Social Weather Stations (SWS) research group, said Arroyo's satisfaction ratings fell to 41 pct of the population compared to 46 pct in their May 28-June 14 survey. Those dissatisfied with Arroyo's performance rose from 32 pct to 40 pct, the SWS said in a statement. SWS head Mahar Mangahas said the survey also found that 61 pct of the public closely followed allegations of opposition Senator Panfilo Lacson that Arroyo's husband, Miguel Arroyo, was involved in money-laundering. The Arroyos have denied the charges. The SWS survey of 1,200 people had a margin of error of plus or minus three pct. Presidential palace spokesman Ricardo Saludo said that the fall in approval ratings were likely linked to Lacson's accusations. "We expect the rating to improve as a new survey is done and people see that the criticism against the president does not hold water," Saludo said. The SWS results were similar to those of a survey in September by another research group, Pulse Asia Inc, which placed President Arroyo's approval ratings at a record low of 41 pct. |
| Manila shares close lower on Moody's outlook downgrade, Wall St losses |
(Updating with analysts' comments, share prices) MANILA (AFX-ASIA) - Share prices closed lower for the fourth straight day as investors continued to cash out following Moody's outlook downgrade on the country's foreign currency rating to negative, dealers said. They added sentiment was also undermined by losses on Wall Street and other regional markets. The composite index closed down 9.31 points or 0.72 pct at 1,288.11 on 1. 22 bln shares worth 354.07 mln pesos. It traded between 1,285.70 and 1,293.37. Losers beat gainers 37 to 11, with 34 stocks unchanged. Moody's cited heightened political uncertainties for the outlook downgrade, warning these could have detrimental consequences for the country's economic and financial situation. "The market is still digesting news on the outlook downgrade, which had caused it to go below the 1,300 level yesterday," AB Capital Securities research director Jose Vistan Jr said. He added the local bourse is undergoing a short-term technical correction, with fundamentals pressured by worries over political developments ahead of the 2004 elections. Asiasec Equities analyst Oliver Plana said, "We're just mirroring the drop in the US market overnight and have moved in line with other regional markets." Dealers, however, said trading is expected to become robust as US President George W Bush's Oct 18 visit to Manila draws near. SM Prime was top-traded, up 0.10 pesos at 6.40 on 12.2 mln shares. Bank of the Philippine Islands was down 1.50 pesos at 41.50 on 936,200 shares following aggressive foreign-selling on the widely-held stock. Ayala Corp shed 0.05 at 4.80 on 7.18 mln shares, while unit Ayala Land also lost 0.10 at 6.20 on 4.7 mln shares. Philippine Long Distance Telephone was steady at 640 on 48,650 shares. First Holdings shed 0.25 at 17.50 on 1.07 mln shares. Globe Telecom ended unchanged at 695.00 on 21,220 shares. Filinvest Land was up 0.02 at 1.06 on 10.79 mln shares. The all-shares index was down 3.93 points at 787.56. The commercial-industrial index fell 9.86 to 1,890.74. Property dropped 0.60 to 569.81. Mining and oil were unchanged at 1,285.00 and 1.36, respectively. Banking and financial services shed 7.71 to 426.73. (1 usd = 54.847 pesos) cecille.yap@afxasia.com |
| Forex - Philippine peso slightly firmer in quiet trade |
MANILA (AFX-ASIA) - The peso was slightly stronger against the US dollar in quiet late morning trade, with Moody's negative outlook on Philippine ratings already discounted, dealers said. They said the peso's appreciation is likely to be capped at 54.80, a strong support level for the dollar. At 11.43 am, the peso averaged 54.846 to the dollar after trading within 54.82-54.87, on volume of 64.00 mln usd. It closed at 54.87 yesterday. "It's in a consolidation phase, but with the dollar supported quite strongly at 54.80. There has been no follow-through buying of dollars since Moody's move has been fully discounted already," a commercial bank dealer said. Exporters have unloaded some of their dollar holdings, the dealer added. The regional currencies' strength against the US unit also provided support for the peso, he said. edelacruz@afxasia.com |
| STOCK ALERT - Bank of Philippine Islands lower on foreign-selling |
MANILA (AFX-ASIA) - Bank of the Philippine Islands was top-traded, but lower in early trade, on aggressive foreign-selling following Moody's outlook downgrade on the country's foreign currency rating to negative, dealers said. At 11.28 am, BPI was down 1.50 pesos at 41.50 on 690,600 shares worth 29. 09 mln pesos. Dealers said the Ayala-owned bank was largely affected by across-the-board selling among foreign investors since it is the most widely-held banking stock in the market. They added Moody's downgrade on the banking sector's outlook to negative, in line with that of the sovereign, also undermined sentiment on the stock. (1 usd = 54.844 pesos) cecille.yap@afxasia.com |
| Philippines' Vulcan Industrial and Mining seeks waiver of SEC penalty |
MANILA (AFX-ASIA) - Vulcan Industrial and Mining Corp said it has requested a waiver of the penalty imposed by the Securities and Exchange Commission (SEC) because of its late filing of its 2002 annual report. It said the delay was caused by the failure of Penta Capital Investment Corp to submit its 2002 audited financial statements to Philodrill Corp. Vulcan did not disclosed the amount, but newspaper reports said the SEC has imposed a 100,000-peso fine on the company. "Inasmuch as we equitize the earnings of Philodrill, we had to wait for the completion of the Penta Capital audited report," Vulcan told the stock exchange. "Our external auditors were insistent that we wait for the audited report of Penta Capital." Vulcan also cited its current financial difficulties "due to dire condition of the mining and petroleum exploration in the Philippines." (1 usd = 54.84 pesos) afxmanila@afxasia.com |
| Philippines' SPI says PPM Ventures still keen on launching tender offer |
MANILA (AFX-ASIA) - SPI Technologies Inc said PPM Ventures Ltd, owned by Prudential plc of the UK, has relayed its continuing interest to launch a tender offer for all issued and to be issued share capital of the database services provider. SPI chief financial officer Francisco Suarez Jr, in a letter to the stock exchange, said the company has received a confirmation from PPM Ventures of its interest to launch a tender offer at the previously indicated price offer of about 84.0 mln usd. SPI's majority shareholders earlier agreed to sell their holdings to PPM Ventures, an international company providing private equity finance and specializing in medium and large buy-outs and institutional purchases. Prudential plc is one of the UK's largest institutional investors and manages over 2.0 bln eur. Suarez said the PPM Ventures' offer price is equivalent to about 14.80 pesos per share, assuming SPI's fully diluted share capital is 312.2 mln shares, including shares to be issued upon the conversion of its 10 mln usd convertible notes outstanding, and a peso exchange rate of 55.00 to 1.00 usd. SPI estimates that the transactions costs, fees and taxes, which are to be deducted from the gross price, will amount to about 0.50 pesos per share. Suarez, however, said the launch of the tender offer is still subject to, among several conditions, the resolution of certain remaining due diligence issu es, irrevocable acceptances from shareholders representing at least 78.1 pct of the fully diluted share capital of SPI, receipt of all requisite regulatory and third party approvals and consents and availability of financing. PPM Ventures intends to incorporate a new company to launch the tender offer next month if the conditions cited are met, he said. Suarez, however, said "there is still no assurance that those conditions will be satisfied, that PPM Ventures will launch the proposed tender offer or that the date of the launch of the proposed tender offer or that the offer price will not change." (1 usd = 54.87 pesos) edelacruz@afxasia.com |
| Philippines' Macroasia acquires Airport Specialists Services Corp |
MANILA (AFX-ASIA) - MacroAsia Corp said it has acquired Airport Specialists' Services Corp (ASSC) from MacroAsia Menzies Airport Services Corp through a deed of assignment executed on Sept 24. MacroAsia, in a disclosure to the stock exchange, said it has acquired 100 pct of ASSC's total issued and outstanding capital stock worth 6.25 mln pesos. It has also assumed the obligation to fully pay the balance of ASSC's 25. 00-mln peso subscription rights. (1 usd = 54.870 pesos) cecille.yap@afxasia.com |
| Easycall Philippines' board approves capital restructuring to address deficit |
MANILA (AFX-ASIA) - Easycall Communication Philippines Inc said its board of directors has approved a capital restructuring plan to address the company's capital deficiency. Easycall, in a disclosure to the stock exchange, said it will undertake a stock split to reduce its authorised capital stock to 60.00 mln shares from 300.00 mln and increase the shares' par value to 5.00 pesos apiece from 1.00. As a result, its issued and outstanding capital stock of 159.52 mln shares, with a par value of 1.00 peso per share, will be replaced by new shares totaling 31.90 mln shares with a par value of 5.00 pesos per share, keeping its total outstanding capital at 159.52 mln pesos. After the stock split, the par value will then be reduced to 1.00 pesos per share from 5.00 pesos for both the authorised capital of the 60.0 mln shares and the issued and outstanding shares of 31.9 mln shares. The cut in par value will result in a "reduction surplus" of 127.61 mln pesos to be recognised in the company's books. The surplus will then be applied against the company's deficit of 197.88 mln pesos as of June, so cutting the deficit to 70.27 mln pesos. (1 usd = 54.870 pesos) cecille.yap@afxasia.com |
| Philippine Aug M3 up 3.80 pct yr-on-yr vs 3.60 pct in July |
MANILA (AFX-ASIA) - The country's M3, or domestic liquidity, grew 3.80 pct year-on-year to 1.62 trln pesos as of end-August, the central bank said in a statement. The growth was a little faster than the 3.60 pct rise in July, it said, citing continued growth in domestic credits to the public and private sectors as well as an expansion in the net foreign assets (NFA) of the monetary system. "Increased investments in foreign-currency denominated assets by deposit money banks, along with a decline in their foreign liabilities, helped improve the level of NFA of the monetary system," the central bank said. It said increased bank investments in fixed-income government securities continued to fuel growth in credits to the public sector, along with loans to the national government and local government units. Net credits to the private sector grew a further 2.90 pct year-on-year in August, down from the 3.80 pct rise in the previous month. "The increase in domestic liquidity was anchored on the steady but modest improvement in domestic demand, as reflected in the various indicators of production and personal consumption," the central bank said. Seasonally-adjusted, M3 at end-August amounted to 1.65 trln pesos, reflecting a month-on-month rise of 0.90 pct compared with the previous month's decline of 0.10 pct, it said. (1 usd = 54.87 pesos) edelacruz@afxasia.com |
| Manila shares outlook - Lower on Moody's downgrade, Wall St losses |
MANILA (AFX-ASIA) - Share prices are expected to open lower as investors are likely to continue cashing out after Moody's outlook downgrade on the Philippines' long-term foreign currency rating to negative, with sentiment further undermined by Wall Street's losses overnight, dealers said. Yesterday, the composite index closed down 12.94 points, or 0.99 pct, at 1,297.42. "The market may continue to decline in the coming sessions as investors have not yet fully discounted the downgrade. Besides the downgrade, local investors will also get some guidance from the major markets abroad," AB Capital Securities research director Jose Vistan Jr said. BPI Securities views the market's weakness as an opportunity to accumulate ahead of the third quarter earnings results. It sees initial support at 1,287 and next at 1,264, while resistance is at 1,300 and next at 1,327. (1 usd = 54.87 pesos) cecille.yap@afxasia.com |
| British firm LNM Holdings offers to revive Philippines' National Steel -report |
MANILA (AFX-ASIA) - London-based LNM Holdings NV, the world's second largest steel producer, has offered to lease and eventually buy the cash-strapped National Steel Corp, the BusinessWorld newspaper reported, quoting LNM general manager for marketing Eric Tierie. "We submitted a bid with an option to buy the assets of the steel firm," Tierie was quoted to have said. Should the company win the bid, it intends to stay long term, inject sufficient capital and ensure its operation in full capacity within two years, the LNM official said. The NSC facility in Iligan province has attracted at least two other interested parties. They are Brazilian steel trader Duferco and India's Global Infrastructure Holdings Ltd, earlier reports said. cecille.yap@afxasia.com |
| Philippine end-Aug M3 up 3.7 pct yr-on-yr vs 3.3 pct rise in July - report |
MANILA (AFX-ASIA) - The country's M3, or domestic liquidity, grew 3.70 pct year-on-year to 1.619 trln pesos as of end-August, the BusinessWorld newspaper reported, citing data from the central bank. The central bank earlier reported M3 grew 3.30 pct year-on-year to 1.611 trln pesos in July, slower than the 6.20 pct rise in June. (1 usd = 54.870 pesos) cecille.yap@afxasia.com |
| Philippines joins Bank for International Settlements |
MANILA, Sept 30 (AFP) - The Philippines has joined the Geneva-based Bank for International Settlements (BIS), the organization of the world's central bankers, it was announced here today. Central Bank of the Philippines deputy governor Alberto Reyes said the country's monetary authorities approved the membership and authorized the payment of about 60 mln usd for the purchase of about 3,000 BIS shares. Membership in the BIS will give the Philippines a voice among the world's central bankers and allow the country to recommend measures affecting the banking industry, Reyes said. "As a member country, the Philippine will be consulted on major policy. We can also make proposals. We will have access to all information and the latest rulings on banking," Reyes said. The Philippines will become the 52nd member of BIS and will be entitled to be represented and vote in BIS general meetings. |
| Philippines' Negros Navigation to re-open Cebu port Oct 5 |
MANILA (AFX-ASIA) - Negros Navigation Co Inc said it will re-open its Cebu port for passengers and cargo on Oct 5. The move is in response to demand from passengers and shippers for a fixed weekly schedule to the port of Cebu, the company told the stock exchange. afxmanila@afxasia.com |
| Philippine armed forces downgrades alert level |
MANILA (AFX-ASIA) - The Philippine armed forces today downgraded its alert status from the highest level, saying there appears to be no further threat to destabilize the government of President Gloria Arroyo. "The military is downgrading its alert level status from red to white effective 6:00 pm (1000 GMT) today...," military spokesman Lieutenant Colonel Daniel Lucero said. The military placed all personnel on "red alert" status on Sept 22 amid intelligence reports of unidentified groups plotting to stage anti-Arroyo rallies around Manila, while the president was away, AFP news agency reported. Arroyo returned today from trips to the US and Europe. The rallies were to take place in key areas, including a historic shrine that served as a staging point for uprisings that ousted president Joseph Estrada in 2001 and dictator Ferdinand Marcos in 1986. A "red alert" means all soldiers' leave is canceled and additional forces are ready for any eventuality. In July, Arroyo quashed a mutiny that more than 300 junior military officers and their men staged accusing her and other defense officials of corruption. The government later said the uprising was part of a larger plot to assassinate the president and replace her with a 15-man junta to be led by opposition senator Gregorio Honasan, who briefly went into hiding, but resurfaced to deny the allegation. The restiveness in the military ranks has forced Arroyo to meet frequently with junior and senior military officers, as well as seek support from retired generals. However, rumors of a plot against her have persisted despite assurances that the military is under tight control. |
| Philippines' Security Bank cash dividend 0.15 pesos per shr |
MANILA (AFX-ASIA) - Security Bank Corp said its board of directors has approved a 0.15 pesos per share cash dividend. The record and payment dates have yet to be determined, it told the stock exchange. (1 usd = 54.87 pesos) afxasia@afxasia.com |
| ROUNDUP - Philippine political risks prompt Moody's ratings outlook downgrade |
MANILA (AFX-ASIA) - Moody's Investor Services said today it has revised its outlook for the Philippines' long-term foreign currency borrowing to negative from stable, citing growing political uncertainties ahead of the 2004 national elections. The move weighed on peso sentiment early in the day and resulted in the Philippine Stock Exchange's key index falling below the key 1,300-point support at the close of trading. Finance Secretary Jose Isidro Camacho, however, said this was "understandable" given the "heightened politicking" that is now taking center stage as the May 2004 elections draw near. And it is precisely because of growing uncertainties in the run-up to next year's polls that the government is considering accessing the international debt market before year-end, not just to complete its 2003 funding requirements but also to pre-fund those for next year, he said. Moody's affirmed the Philippines' "Ba1" rating, which is considered one notch below investment grade and one notch higher than those of Standard Poor's and FitchRatings. It also affirmed the local currency rating at "Baa3 with a negative outlook," as it also expressed concern about the sustainability of the improvement in government revenue collections and of keeping the budget deficit below the ceiling. Moody's said intense politicking could have detrimental consequences for the country's economic and financial situation. "Although the administration of President Gloria Macapagal-Arroyo has prevailed against the recent challenges, political risks are rising as the 2004 presidential elections approaches," it said in a statement. "A continued deterioration in the political climate could weaken further the Philippines' external payments position due to weaker current and capital accounts positions." Camacho, who said the government's borrowing plans this year will remain intact despite Moody's move, said that while next year's democratic process "need not be a hindrance for them, investors prefer to wait it out (on) the sidelines until the political picture becomes clearer to them." Central bank deputy governor Amando Tetangco Jr said Moody's concern "is largely focused on the balance of payments and how it could be affected next year by the impact of the electoral process on foreign direct investments and our trade prospects." "I am hopeful that this outlook (will be) reversed in the second half of next year as the uncertainty brought about by the political situation is lifted given a new six-year mandate for the next administration by July 2004, " he said. "Such a scenario will allow the economy to perform with greater ease and less distraction for continued economic growth acceleration, barring any further shocks from the external markets." The ratings outlook downgrade weakened the peso in late morning session, but then recovered in afternoon trade to close firmer at 54.870 to the US dollar against yesterday's close of 54.900. Tetangco said there was a knee-jerk reaction in the local currency market following Moody's announcement. But he said the expected seasonally-strong inflows in the fourth quarter, which should give the peso a boost, as well as strong regional currencies, provided the peso support. The stock market's key index, however, closed down 12.94 points or 0.99 pct at 1,297.42, as investors cashed out following news on the rating outlook downgrade. Camacho, however, said the government's borrowing plans this year are unaffected by Moody's move. "(Moody's move) does not really change (the borrowing plans) at all. In fact, it reinforces our reasons for looking to do that. It's clear that the political question of May 2004 is beginning to play a role in the minds of not only the credit analysts, but also of investors," Camacho said in a local television interview. "In an effort to preempt that and make sure the Philippines' cash position, the government's funding position next year, as we approach the election, is very stable and very solid...is precisely the reason why we are considering pre-funding." A source earlier said the government may have to borrow another 3.00 bln usd to finance its requirements, as well as those of state-owned National Power Corp next year. While Napocor will need 1.20 usd for 2004, the national government will require 1.80 bln usd next year, the source said, and will still need to borrow 250.00 mln usd to complete this year's financing requirements. (1 usd = 54.87 pesos) edelacruz@afxasia.com |
| Philippines' Jollibee Foods board approves merger with wholly-owned units |
MANILA (AFX-ASIA) - Jollibee Foods Corp's board of directors has approved the merger of wholly-owned subsidiaries Superior FSC Foods Corp and FSC Foods Corp with Jollibee, the latter told the stock exchange. Jollibee Foods is the surviving entity. afxmanila@afxasia.com |
| Philippine Treasury opens 1.0 bln peso tap facility for 5-yr bonds |
MANILA (AFX-ASIA) - The Bureau of Treasury said it has opened a 1.0 bln peso tap facility, available until 3.00 pm tomorrow, for its five-year bonds. The Treasury said the coupon for the five-year bonds has been set at 10. 250 pct. The yield-to-maturity rate is 10.018 pct. (1 usd = 54.870 pesos) afxmanila@afxasia.com |
| Philippine Treasury raises 3.0 bln pesos via 5-yr bond issue |
MANILA (AFX-ASIA) - The Bureau of Treasury said it raised 3.00 bln pesos from the issue of five-year T-bonds today, against total tenders of 8.04 bln pesos. The coupon rate was set at 10.250 pct. (1 usd = 54.870 pesos) afxmanila@afxasia.com |
| Forex- Philippine peso closes firmer; Moody's downgrade priced in |
MANILA (AFX-ASIA) - The peso recouped earlier declines to close firmer against the US dollar in line with stronger regional currencies and helped by some dollar-selling on the part of the central bank, dealers said. The peso closed at 54.870 after trading between 54.810 and 54.970 on volume of 195.00 mln usd. It closed at 54.900 yesterday. Dealers said the peso, which was anticipated to trade firmer in line with a weaker dollar across-the-board, dropped to an intra-day low of 54.970 late morning, immediately after Moody's downgraded its foreign currency ratings outlook on the Philippines. The downgrade was largely due to heightened political uncertainties ahead of the 2004 presidential election. The central bank reportedly stepped in to prevent the peso from falling further and was seen selling roughly 30.00 mln usd to provide the market with additional liquidity. Central bank acting governor Amado Tetangco Jr, however, said the regulator was not in the spot market today. Instead, he attributed the local currency's recovery to strong inflows and expectations that the peso will strengthen moving into the fourth quarter. "There was a knee-jerk reaction to the Moody's outlook downgrade, but then after a while the market realised that the downgrade was just in line with previous decisions of other rating agencies... that in effect, it is already priced in," a local bank dealer said. Another dealer added the central bank's intervention also provided support for the peso, helping it to move in line with other regional currencies in the afternoon trade. Dealers said the peso should trade firmer tomorrow in line with the anticipated continued strong showing of other currencies in the region. cecille.yap@afxasia.com |
| Six Philippine banks rating outlooks revised to negative - Moody's - UPDATE |
MANILA (AFX-ASIA) - Moody's Investors Service said it has revised to negative from stable its rating outlooks on six Philippine banks, including listed Bank of the Philippine Islands, Metropolitan Bank and Trust Co, Philippine National Bank and Equitable PCI Bank. The two others are state-owned Development Bank of the Philippines and Land Bank of the Philippines. In a statement, Moody's said the "Not-Prime" short-term deposit and bank financial strength ratings of all six banks are unaffected. Moody's said the action follows the cut in its outlook for the Philippines' long-term foreign currency borrowing to negative from stable. The agency said the stable outlooks for the ratings of Allied Banking Corp, Rizal Commercial Banking Corp and United Coconut Planters Bank are unaffected. edelacruz@afxasia.com |
| Philippines not changing borrowing plans this yr despite Moody's move -Camacho |
MANILA (AFX-ASIA) - Finance Secretary Jose Isidro Camacho said the government is not changing its plan to access the international debt market before the year ends, despite Moody's Investors Service's revision of its rating outlook for the Philippines to negative from stable. The government is considering borrowing offshore to complete its financing requirements for 2003 and pre-fund those for next year. Moody's revised the outlook on the country's foreign currency debt to negative from stable due to heightened political uncertainties, which could affect investor sentiment. It also raised concern over the country's fiscal deficit picture. "It (Moody's move) does not really change it (borrowing plan) at all. In fact, it reinforces our reasons for looking to do that. It's clear that the political question of May 2004 is beginning to play a role in the minds of not only the credit analysts, but also of investors," Camacho said in a local television interview. "In an effort to preempt that and make sure the Philippines' cash position, the government's funding position next year, as we approach the election, is very stable and very solid. This is precisely the reason why we are considering pre-funding." A source earlier said the government may have to raise 3.0 bln usd in fresh borrowings to finance its requirements, as well as that of state-owned National Power Corp next year. The national government will need 1.8 bln usd and Napocor 1.2 bln for 2004, the source said. The national government will still need to borrow 250.0 mln usd to complete this year's financing requirements. (1 usd = 54.90 pesos) edelacruz@afxasia.com |
| Waterfront Philippines says offer to manage Cebu hotel in exploratory stage |
MANILA (AFX-ASIA) - Waterfront Philippines Inc said its offer to manage the idle Cebu Plaza Hotel, through its subsidiary Waterfront Management Corp, is still in the exploratory stage. "As of this time, no definite agreement has been reached by Waterfront Philippines nor its subsidiary with the said hotel," the company told the stock exchange. The company was reacting to a newspaper report that it was interested to run Cebu Plaza. afxmanila@afxasia.com |
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