money matters

Security Bank Q2-2019 profit up 32% Year-on-Year to Php2.57 billion

August 7, 2019

THE Security Bank Corporation (PSE: SECB) posted Php2.57 billion in net income in the second quarter of 2019, up by 32% versus year-ago level. Total revenues grew 32% year-on-year to Php 7.9 billion. Net interest income from customer loans and deposits sustained its strong trajectory growing by 44% to Php 5.4 billion. This was driven by the continued expansion of retail loans and low-cost deposits. Retail loan growth accelerated to 54% year-on-year while low-cost deposits increased 11%. Retail loans now account for 25% of total loans versus 18% a year ago. Total loans grew 11% year-on-year to Php 427 billion. Total deposits stood at Php 449 billion. On June 28, 2019, the Bank issued Php 18 billion worth of fixed-rate peso corporate bonds with a tenor of 2 years as a cost-efficient funding source alternative to short-term high-cost deposits. Total deposits and peso corporate bonds combined grew 5% year-on-year. Net interest spread on loans and deposits increased to 5.36% in Q2-2019, up 38 basis points quarter-on-quarter and 108 basis points year-on-year. Total net interest income grew by 22% to Php 6.1 billion. Interest income from financial investments grew 7%. Overall, net interest margin increased to 3.59% in Q2-2019, up 18 basis points quarter-on-quarter and 42 basis points year-on-year. Service charges, fees and commissions increased 70% to Php 1 billion. This was driven by loan fees, credit cards, deposit charges and bancassurance. Securities trading gains in Q2-2019 amounted to Php 376 million. Total non-interest income increased by 81% year-on-year to Php 1.7 billion. For the January 1 to June 30, 2019 period, net income was Php 4.95 billion, up 15% from year-ago level. Net interest income from customer loans and deposits increased by 37% or Php 2.7 billion to Php 10.1 billion. Interest income from financial investments was higher by 9% or Php 439 million. Total net interest income grew by 18% to Php 11.8 billion. Service charges, fees and commissions for the six-month period increased by 46% to Php 1.86 billion. Securities trading gains totaled Php 1 billion. Cost-to-income ratio was 53.7% despite a year-on-year operating expense growth (excluding provisions for credit and impairment losses) of 23%. Asset quality remained healthy, with gross non-performing loan (NPL) ratio at 1.1% versus 0.75% a quarter-ago, and lower than industry’s 1.7% as of May 2019. The Bank set aside Php 639 million for provision for credit losses in 1H-2019. NPL reserve cover was 127%. Security Bank continues to be among the country’s best capitalized private domestic universal banks. Common Equity Tier 1 Ratio further increased to 16.8% from 16.5% a quarter-ago. Total Capital Adequacy Ratio likewise strengthened to 19.2% from 19.0%. Return on shareholders’ equity increased to 8.8% from 8.1% in 2018. Shareholders’ capital improved to Php 115 billion, up 7% year-on-year. Total assets increased 8% to Php 777 billion.

PH 2020 national budget: PHP4.1 trillion

August 6, 2019

PRESIDENT Rodrigo R. Duterte has approved the proposed national budget for 2020 worth PHP4.1 trillion, Malacañang said on Tuesday (August 6, 2019). Presidential Spokesperson Salvador Panelo said Duterte approved the proposed 2020 cash-based national budget during the Cabinet meeting that started Monday (August 5) night. The PHP4.1-trillion budget is 12 percent more than this year’s PHP3.7-trillion expenditure program. Last year, Duterte submitted the proposed PHP3.7-trillion national budget for 2019 to Congress, on the same day he delivered his third State of the Nation Address (SONA). However, the government operated on a reenacted budget since January 1 this year after lawmakers failed to pass the bill on time due to a budget impasse in Congress. Duterte finally signed the 2019 budget but vetoed several provisions on April 15, 2019. Malacañang has yet to announce when it will be transmitting the budget proposal to the Congress but has 30 days from his fourth SONA to do so or until August 22. In a statement, Panelo described the budget proposal as one that would “respond to the needs” of majority of Filipinos. “This budget proposal is designed to respond to the needs of the majority of our countrymen longing to be uprooted from the decades of: want of basic necessities, inadequate supply of basic services, lack of infrastructures required to spur economic growth, absence of accountability on government coffers, vexing bureaucratic rigmarole, deprived education and unchanged poverty, and geared to achieve a more peaceful and progressive Philippines where the living standards of Filipinos are raised,” Panelo said. Panelo assured the public that the budget’s biggest slice will be allotted to education, followed by public works, transportation, and health. Moreover, he said the budget will be spent “wisely to reach a state of vibrant economy that will be felt by the citizenry.” The Palace has expressed hope that the 2020 budget would be approved without any delays. (PNA)

GCash teaches Filipino youth how to be financially responsible

July 24, 2019

“HOW do I start investing? How do I start saving up? When do I know when to get insurance? These are the questions I’m asked,” Mynt Chief Marketing Officer Chris Manguera said the company, which runs GCash, the leading mobile wallet app in the Philippines. With a majority of the country’s youth aiming to be financially responsible, GCash is compelled to innovate and improve their products to address the needs of young users who want to be financially responsible. Manguera said: “The intention is clear. They all have the intention to save, to be financially ready. But in the end the big gap is between intention and action. It’s our responsibility to bridge the gap.” He explained that discussions with GCash users aged 18 to 35––which comprise a third of their 20-million user base––revealed that young Filipinos want products that (1) provide a customized or personalized experience; (2) are proven to be the best in the market; and (3) are convenient to use. “No. 3 is the most important—convenience. This is a daily journey for us, to improve the convenience of our product,” said Manguera. “We have to enable them. How do we give them access to multiple channels?” One way GCash has done so, he said, is to leverage the steady rise of smartphone use in the country. According to Manguera, there were 48 million smartphone users by the end of 2018, and by the end of 2019, roughly 50-60 million Filipinos will have a smartphone. “That transforms everything. A smartphone is access to opportunities. It is access to information. It’s also access to financial services,” Manguera said. “The smartphone is becoming a gateway for many opportunities. That is the opportunity that GCash saw.” Because GCash is a mobile service, the people behind it sought to find out what convinced or discouraged mobile phone users to download the app. What they discovered was that many Filipinos who download mobile apps check the size of the apps first, as their phones many not have enough storage for it. For most smartphone users, an app that takes up 20-40 MB is okay, but it still depends on how many photos are in their phones. “They actually care about their storage. They actually care about how many photos they have to delete to install your app,” Manguera said. Adapting to this reality, GCash decided to use apps already found in most smartphones, like Facebook Messenger, to provide access to GCash’s most popular services: online bills payment, domestic remittances, and the purchase of prepaid load. With its #PwedePala online campaign touting the benefits of FB Messenger-activated GCash accounts, the company saw a 60% growth in new registrations in the first 60 days of the campaign, many of them young users. “Different experiences, different motivations. But at the core of it, they all desire to be financially ready. Whether you’re a breadwinner, a fresh graduate living with your parents or wanting to travel the world, or a working student wanting to earn more, to better manage your resources––at the core of it they just want to be financially responsible,” Manguera said. Since 2015 GCash has been the leading finance app in the Google Play Store. It has received numerous distinctions, such as the Best Mobile Payment App of the Year in 2017 from The Asian Banker and the Best Mobile Payment Service Award from the Telecom Asia Awards in 2018. The Bangko Sentral ng PIlipinas (BSP) has also recognized GCash as its Outstanding Partner for Digital Transformation and Outstanding Partner for Innovative Financial Services for 2019, citing its innovative and responsive digital financial services.

More events in 3Q to boost CDO economic activity – Oro Chamber

June 22, 2019

THE largest lobby of micro, small and medium scale enterprises (MSMEs) in Northern Mindanao has outlined its activities for the next three months to help boost the continuing economic growth in the region. During their quarterly meeting last Friday, Cagayan de Oro Chamber of Commerce and Industry president Irene Floro announced the following activities to be held here from July to October – an innovation talk, package of technologies with economic studies and business plans, financing forum, technopreneurship training, three-in-one trade show, Orobest Expo, Cagayan de Oro Business Conference, pitching sessions, business forum and scientific meetings, industry and academe technology matching, patent talk and green financing forum, among others. Floro said these events are meant to educate not just the Oro Chamber members but also to boost investment opportunities in Northern Mindanao and strengthen the local economy here. In her quarterly valedictory report, Floro said the ideation workshop in April brought together the industry, academe and government to discuss technology interventions for five identified establishments. During that month, the Search for Homegrown Heroes and a forum on the role of women were also held. Oro Chamber likewise participated in a mentorship program with micro and small homegrown processors in cooperation with the Food Processors Association of Northern Mindanao (FOPANORMIN). In May, Oro Chamber was also able to successfully hold the Entrepreneurial Talk Series I with focus on innovation and corporate entrepreneurship as well as an introduction to the Master in Entrepreneurship Program at the Asian Institute of Management (AIM). In the same month, the Mentor Me on Wheels was held in cooperation with the Department of Trade and Industry (DTI) and the Philippine Center for Entrepeneurship. The activity spurred a money and market encounter with financial institutions, malls, supermarkets and online stores as participants. An official from the World Bank also visited the Oro Chamber to discuss poverty reduction interventions in education. Early this month, Oro Chamber inked an agreement for the Search for the Best PESO in Northern Mindanao. PESO stands for Public Employment Service Office and is a department in most local government units (LGUs) regionwide. Floro reiterated that the priority areas of Oro Chamber are chamber governance, policy advocacy and formulation, partnership building/strengthening, membership development and relations, chamber relations, financial management and internal controls and organizational sustainability.

Short on cash?

June 13, 2019

IT is time to bid your money woes goodbye. Farewell to the scenario where you have to face the reality of an empty wallet on your next shopping trip, or to the sinking feeling of not having enough cash to pay your bills until the next paycheck. Short on cash? In dire need of funds in an instant? Within a click’s reach is your saving grace -- the GCash app. Emergencies are stressful no more with the GCash’s “request money” feature. Aside from saving people the problem of lugging around money in a bulky purse or wallet, GCash eases the transfer from one mobile wallet to another. At the drop of a hat, friends can easily request money from each other in times of distress and ask for money. Requesting for more moolah in your mobile wallet has never been this easy. The request money feature is readily visible in the app’s dashboard once you open it. Just enter your friend’s name or mobile number, the amount you need, and the problem already solves itself. If you’re in the mood to explain your situation or deliver an advanced message of gratitude, the GCash allows you to do just that.  Responding to a friend’s financial SOS is a breeze, too. Simply check your app’s notifications and sending help is as mindless as clicking a button on your smartphone. Plus, there is also a special tab to track your history of requests for reference. The cherry on top? It doesn't matter if you’re a Smart, Sun, or TNT subscriber. Now, all it takes is a SIM card and smartphone, and you can take advantage of whole array of GCash services through your mobile phone. It’s as easy as grabbing the free app on Google Play Store or iOS App Store and registering for an account.  In the eyes of GCash, operated by Globe Fintech Innovations Inc. (Mynt), no network should be left behind. Even though it is a company led by Globe Telecom Inc., Ayala Corp., and Ant Financial, this new financial technology wonder is out to pave the way towards a cashless society by adopting a policy of inclusivity.  Long gone were the days where GCash was exclusive to one network. Now, anyone can participate in the cashless revolution and have access to greater convenience through the GCash app.  “We believe in the power of inclusivity. As we lead the push for financial inclusion across the different sectors of the society, we believe that providing a telco agnostic platform will help more Filipinos participate in the digital economy,” Mynt Vice President for Money Transfer Fred Levy said.  GCash is the new must-have in an age where technology reigns supreme. It is a mobile money service, regulated by the Bangko Sentral ng Pilipinas, where you can buy load, purchase items, send and receive money, pay bills, and more using Globe, TM, Smart, Sun, or TNT -- or the future telco player that everybody is raving about.  GCash, the leading and revolutionary mobile wallet in the Philippines, is designed to help users navigate through the modern, agile world of finance. So the next time that you find yourself knee deep in money troubles, just remember that your fellow GCash users are literally one tap away.

Economic managers announce growth catch up plan

May 28, 2019

MANILA – Economic managers have agreed to further strengthen coordination with other agencies, especially on acquiring permits and other requirements, to fast-track implementation of infrastructure and socioeconomic programs to meet 2019 growth targets amid the impact of budget delay.      Finance Secretary Carlos Dominguez III, in a statement after the meeting of the Economic Development Cluster at the Department of Finance (DOF) Friday, said officials of both the Department of Public Works and Highways (DPWH) and the Department of Transportation (DOTr) are optimistic of meeting their disbursement program for this year.      "To enable them to attain their targets, it would require close cooperation and support of other government agencies by expediting the approval of permits and other requirements,” he said, as he expressed hope that “no major weather disturbance will disrupt the implementation of the projects.”      The social protection programs that were agreed to be implemented faster include the national ID System, 4Ps, social pension, unconditional cash transfers, and fuel marking program.      Dominguez said that aside from these programs, the government will also “double its efforts in the agriculture sector, which should expand by at least 2 percent per year.”      He explained that if the 2018 national budget was approved on time, growth in the first quarter of the year would have risen between 6.6 to 7.2 percent instead of the four-year low of 5.6 percent.      President Rodrigo R. Duterte signed this year’s budget only last April after the impasse in Congress.      Dominguez said that since the government worked on a re-enacted budget in the first quarter, there was about PHP1 billion underspending per day.      He, thus, stressed the need to put in a “carefully crafted and bold expenditure catch-up plan to enable us to hit a GDP growth rate of above 6 percent this year.”      He said spending from January to March this year reached PHP778 billion, little moved from year-ago’s PHP772 billion.      The programmed spending for this year amounts to PHP3.774 trillion, or about 19.6 percent of gross domestic product (GDP) while total infrastructure disbursement was set at PHP1 trillion or about 5.2 percent of domestic output.      Dominguez also noted the need for the participation of the private sector to help boost economic growth, thus, the enactment of the Ease of Doing Business in May 28, 2018 to entice more businesses.      He also said that “the Executive and the Legislative branches of government also need to work together in passing legislation that allows for a business-friendly environment, such as the Public Service Act, Foreign Investments Act, and the Retail Trade Act.”      The continued deceleration of domestic inflation rate, which declined to 3 percent last April after peaking at 6.7 percent in September to October last year, is also positive for the economy, he said.      "We will intensify our efforts to restore last year’s upward momentum in our growth rate,” he added.      Relatively, Socio-economic Planning Secretary Ernesto Pernia, during a press briefing after the EDC meeting, said economic managers are still studying whether to adjust this year’s economic targets.      "We still have to do some number crunching to have more realistic numbers regarding growth rate and related numbers so it is better that we wait until we are more confident with what we can tell you,” he said.      Among others, GDP target this year has been lowered to between six to seven percent while deficit target is at 3.2 percent of domestic output.      Meanwhile, Department of Budget and Management (DBM) acting chief Janet Abuel said that because of the delay in the approval of this year’s budget, it will be hard to fully implement the cash-based budgeting system, which requires all state agencies to pay within the year all the contracts they need to accomplish.      She said deadline for the infrastructure projects and payments for these contracts has been moved to December 31, 2020 while those for Maintenance and Other Operating Expenses (MOOE) will be on June 30, 2020.      "We hope that will lessen the worries of the agencies in paying their contractors,” she added. (PNA)


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