Maniolas

MANILA, Philippines – The Department of Finance supports a proposal seeking to create a megabank by merging state owned Land Bank of the Philippines and Development Bank of the Philippines. According to the DOF, the merger of Landbank and DBP is necessary as the functions of both banks duplicate and unnecessarily overlap with one another. The merged entity would be more effective, efficient and sustainable in carrying out the mandates of both banks, especially with the entry of more foreign banks into the country following the liberalization of the local banking sector, the DOF said. The consolidation of the two banks is also expected to complement the implementation of the Treasury Single Account (TSA), a unified structure of government bank accounts. Under the TSA, all government revenues deposited to accredited agent banks would be lodged in a single account with the central bank.  The TSA forms part of the government’s public financial management reform program, which seeks to simplify, improve and harmonize the financial management processes and information systems of the public sector. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 If the merger pushes through, the government expects the funding capability and branch network of the consolidated entity to expand.  As of end-June 2013,  Landbank had a total of 337 branches while DBP had 104.   The union of the two banks would give the merged entity at least 441 branches, enabling them to increase their presence. Redundant branches, however, may be closed,  which would result in savings that Read More …

MANILA, Philippines – No “second-round” effects from the sustained rise in the prices of commodities have been observed so far, the Bangko Sentral ng Pilipinas said, adding inflation is still expected to remain within target for this year until 2016. “The MB (Monetary Board) noted that broad-based indications of second-round effects of food price shocks have not thus far become evident,” according to the latest Highlights of the Meeting of the Monetary Board on Monetary Policy Issues. “Recent wage petitions have not diverged significantly from their historical trends and there are no new calls for transport fare adjustments,” the central bank said. The so-called “second round” effects of inflation happen when workers demand for higher wages to offset the already high living expenses. “Nonetheless, the MB was of the view that second-round effects of supply-side pressures will require close monitoring,” the BSP said. “Average annual inflation is still expected to settle within the government’s target range for 2014 to 2016… Inflation expectations remain well-behaved although near the upper bound of 2015-2016 target range,” the BSP said. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 Inflation stood at an average rate of 4.4 percent in the first nine months of the year, above the midpoint of the three-to five-percent target range. For 2015 and 2016, the government expects inflation to settle at two to four percent. “However, the balance of risks to future inflation is still dominated by upside risks. Possible upticks in food prices as a result of tight Read More …

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) will likely end moves to adjust interest rates this year, but is poised to continue raising rates by early 2015, a leading bank economist said. JPMorgan, Chase Bank chief Asean economist Sin Beng Ong said the BSP would hike rates just once in mid-2015.  “Thus (the BSP) has taken out the two overnight reverse repo (RR) hikes that were penciled in for fourth quarter this year and first semester of 2015,” Sin added. The BSP tightening this year has been symmetric. There have been two 100 basis points (bps) RR hikes, two 25 bps special deposit accounts (SDA) rate hikes, and two 25 bps policy rate hikes. With food inflation easing in September and global commodity prices having eased recently, the inflation trajectory in 2015 has been revised down and the forecast trajectory now sits at the mid-point rather than the upper end of the two- to four-percent BSP inflation target for 2015. This thus reduces the need for the BSP to signal its concerns over inflationary risks, Sin said. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 The economist said only one rate hike expected in mid-2015, taking other two prior hikes out. The currently low level of onshore peso rates against the dollar rates remains a risk that could catalyze currency substitution. “We see the BSP hiking its overnight reverse repo and SDA rate by 25 bps in mid-2015 following the anticipated hike in the (US) Fed funds Read More …

THE COUNTRY has enough chicken and pork supply to last until the Christmas season, local producers yesterday said.

MANILA, Philippines – The Bangko Sentral ng Pilipinas has ordered banks to step up security measures especially for automated teller machines (ATMs) and point of sale (POS) units amid growing consumer complaints involving card fraud and skimming attacks. In a memorandum, the BSP directed banks and other BSP-regulated institutions to install additional layers of protection to mitigate fraud involving ATM and POS units. The central bank said the “establishment of detection process and alert mechanisms for timely and appropriate incident response and action; and use of transaction alerts on withdrawals and other transactions exceeding defined thresholds” will help protect consumers against card fraud. Skimming refers to an act of stealing information stored in cards through devices hidden in an ATM or POS unit. The BSP has given banks until Jan. 1, 2017 to migrate their card systems to EMV technology. EMV, which stands for Europay, Mastercard and Visa, is a global standard for electronic payments based on chip  technology, which is more secure than the older magnetic stripe technology. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 “Electronic payment cards (i.e., ATM debit, credit and prepaid cards) are still vulnerable to skimming attacks given the continued use of magnetic stripe technology,” the BSP said. “Pending migration of the entire payment card network to EMV by Jan. 1, 2017, electronic payment cards remain largely defenseless against modern fraud techniques unless multiple layers of protection are adopted by BSP-supervised institutions,” the central bank said. But aside from controls that will protect Read More …