opinion

In pursuit of banking excellence

July 19, 2019

BAIPHIL supports the banking industry through continuing education, research, and information exchange while upholding the values of good governance, competence and integrity, service, teamwork, and innovation. Newly-inducted President Blesilda P. Andres, (Head of BPI’s Regulatory Compliance) pledged to carry on BAIPHIL’s legacy and sustain the vision “to be the leader in pursuit of banking excellence, aiming to be one of the best in the Asia Pacific Region”.  BSP Governor Benjamin E. Diokno, who was both the inducting officer and guest speaker, reminded BAIPHIL of the challenges faced by the industry given the ongoing digital transformation of the banking system.  Diokno cited the urgent need for collaborative governance to manage technological opportunities and disruptions.  Here is where  BAIPHIL could be a strong catalyst “to support and reinforce the banking industry’s seamless transition into the digital age”, Diokno said.  For BSP’s part, Diokno reaffirmed the central monetary authority’s  commitment to providing a proactive, enabling environment that will usher the efficient delivery of digital financial services and promote greater financial inclusion.  Also Inducted as BAIPHIL officers  were Restituto C. Cruz, (BSP Assistant Governor) First Vice President; Myrna E. Amahan, (FVP/Chief Audit Executive, Union Bank) Second Vice President; Romel D. Meniado, (FVP, Robinsons Bank)  Secretary; Arnel A. Valles (SVP, United Coconut Planters Bank) Treasurer.  Inducted as Directors were: Marilou C. Bartolome (SVP, Metrobank), Mary Jane C. Japor, (AVP, Australia New Zealand Banking Group); Racquel B. Mañago (VP, Philippine Veterans Bank); Estrellita V. Ong, (Chief Internal Auditor, BDO); Edeza A. Que (FVP, Philippine Savings Bank); and Edel Mary Vegamora (EVP, RCBC). Immediate past president Dom B. Gavino, Jr. (ING Bank NV) joined BAIPHIL’s Advisers who include  Ma. Dolores B. Yuvienco (BPI), Josefa Elvira E. Ditching-Lorico (BSP), Antonio V. Viray, (Chief Adviser for Legal Affairs) and Rhoneil S. Fajardo (Deutsche Bank).  Named to various committees and sub-committees were: Dom B. Gavino, Jr. (ING Bank NV),, Godofredo L. Martinez (UCPB), Carol P. Warner (SBTC), Ma. Bernadette T. Ratcliffe (Maybank), Maria Victoria P. Ronquillo (UCPB), Iñigo L. Regalado III (BSP), Mardonio C. Cervantes ( Associate Life Member ), Belinda C. Rodriguez (PBB), Irene DL. Arroyo (PDIC), Amelita G. Cua (Philtrust), Carlota A. Bacani (Australia and New Zealand Banking Group), Maria Rachelle A. Fajatin (Equicom), Francis B. Albalate (Union Bank), Leila P. Paz-Aguba (Union Bank), Emma B. Co (PSBank), Josefa Elvira E. Ditching-Lorico (BSP), Teresita L. Andres (Associate Life Member), Susan R. Alcala-Uranza (former president BAIPHIL ), Reginald C. Nery (Bank of Commerce) and Shirley G. Felix (PDIC). Bangko Sentral ng Pilipinas Assistant Governor Restituto Cruz traced the roots of BAIPHIL, which even antedated the Central Bank of the Philippines.  BAIPHIL was founded in 1941 as a non-stock, non-profit corporation under the name National Association of Bank Auditors and Comptrollers (NABAC), primarily with the goal of increasing the efficiency and uniformity in bank accounting, auditing and operations among banks. It metamorphosed into the Association of Bank Audit, Controls and Operations, subsequently the Bank Administration Institute (Philippine Chapter) and finally into the Bankers Institute of the Philippines. From a small circle of accountants and auditors, the Institute has evolved into a prestigious and respectable bankers’ organization.   It now boasts of 62 institutional members composed mostly of universal, commercial, foreign, thrift and government banks, the BSP, PDIC, PCHC, BANCNET, and more than 300 key bank executives as associates and sustaining life members.

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Bank of the the Philippine Islands @ 165

July 18, 2019

At 165 years and counting, Bank of the Philippine Islands (BPI) -  the country’s first bank - continues to notch many “firsts” in the banking and financial  industry.   Originally named Banco Espanol de Isabel II ( after Spain’s then reigning monarch), BPI  was established  in August 1, 1851,  by the Junta de Autoridades. The Junta was a Manila-based committee of civil and ecclesiastical officials,  which was created in 1828  by royal decree of King Ferdinand VII.   The bank’s original capital was provided by Obras Pias – which handled charitable contributions to the Catholic Church.  Among the original stockholders was prominent businessman Antonio de Ayala, forebear of current BPI Chair Jaime Augusto Zobel de Ayala.   During simple rites commemmorating the bank’s 165th anniversary earlier this month, Cezar P. Consing, BPI President,  described  the bank’s evolution and growth, as follows:    “The Church was the dominant shareholder until 1968, when Ayala became the bank’s largest shareholder.   Some of the best names in global finance have been BPI shareholders:  J.P. Morgan, taking a 20% stake in 1974, DBS buying J.P. Morgan’s stake in 1999, and the Government Investment Corporation of Singapore acquiring a portion of DBS’ stake in 2014.”   Acquisitions complemented organic growth. “..in 1974, People’s Bank; in 1980, Comtrust; in 1984, Family Savings Bank; in 1996, Citytrust; in 2000, Far East Bank; and in 2005, Prudential Bank.”   Consing enumerated the many “firsts” in BPI’s glorious  history.   1851 – BPI made its first loan to a Filipino-Chinese merchant.   1864 – BPI lent money to the colonial government to build Arranque Market and Hospital de San Juan de Dios.   1888 – BPI financed Jacobo Zobel’s Companie de Tranvias de Filipinas, the steam operated railway that replaced horse-drawn carriages.   1896 – BPI issued the Phippines’ the very first bank note.    By royal decree, BPI was given the monopoly of  issuing  notes to extent of three times its capital stock of 1.5 million pesos. “Its bank notes were designated as Pesos Fuertes, in denominations of 5, 10, 25, 50, 100 and 200, payable in Mexican or Spanish-Filipino silver coins.” ( from Money and Banking in the Philippines)   The bank notes were jointly used  with Mexican peso coins, Alfonsino pesos, Spanish coins and  Manila-minted Spanish-Filipino silver coins.   1982 – Pioneered in electronic banking.   1990 – Established the first ATM network.   2000 – Established the first bancassurance company.   2009 – Established the first mobile microfinance institution.   2013 – Built the first solar-powered bank branch. ( Ayala Avenue Extension Branch)      2016 – BPI, together with ADB and Credit Guarantee Investment Facility (CIGF) issued the first Climate Bond certified in emerging markets for a single project.  This P12.5B transaction was provided to Aboitiz Power Renewables, Inc .   Despite massive volatilites faced by international and financial institutions in 2015,  BPI had another good year. The numbers showed significant improvements across all metrics, eg.,  total assets, loans , deposits, asset yields, assets under management, capital adequacy and  market capitalization. Particularly impressive was BPI’s CASA ratio – a barometer of client loyalty and cost competitiveness – which is now the highest among peer institutions.   In addition, BPI continued to engage the community in several fronts.   -BPI Foundation directly engaged and advanced financial wellness, financial inclusion, financial literacy and sustainable development.   -The BPI-DOST Science Awards continued to provide the country’s brightest students a platform for presenting and implementing science and techonlogy-based business concepts.   -BPI Sinag continued to  empower young Filipino entrepreneurs via a complete program of  social entrepreneurship boot camp, mentorship and access to incubation financing.     -BPI also nurtured the civic spirit of its employees through the BPI Bayan Volunteerism Program.  In 2015, as  in previous years, BPI staffers contributed thousands of volunteer hours to  assist targetted communities in conceptualizing, organizing, fund-raising and implementing self-help projects.   Consing attributed BPI’s longevity and prosperity to its faithful adherence to its Credo:   “BPI has prospered throughout its long history because it has never shirked from its primary responsibilities: to our Clients—we do well when our clients do well; to our People—fair rewards for integrity, professionalism and loyalty; to our Shareholders—superior risk-adjusted returns and prudent management; and to our Country—inclusive and responsible nation building.”   (Disclosure: This writer was an officer of BPI prior to joining government in 1986. He  recently  rejoined BPI as an independent director.)

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There is no excuse for murder!

July 12, 2019

In just two days last week, 57 were killed in separate operations in Bulacan and Metro Manila – a much higher daily casualty rate than in the war against the Maute terrorists in Marawi City. As in previous cases, Kian was initially reported as having fired at policemen engaged in an anti-drug operation. This gave the supposed law enforcers no alternative but to fire back, fatally wounding the teenager. A photo of a caliber .45 pistol in Kian’s left hand was Exhibit A in what police termed as a very clear case of “nanlaban”. But things did not turn out well for three Caloocan City police operatives who were involved in the incident. Two of them got caught on cam dragging away an apparently helpless, defenseless young man away from the scene of the arrest. And that was the last time, Kian was seen alive. Kian was right-handed. Two separate medico-legal examinations conducted both by the PNP and the Public Attorney’s Office more or less agreed that Kian had no powder burns. His bullet wounds indicated that Ian was kneeling with his head almost flat on the ground when he was shot. He was shot at close range. Public outrage over the injustice – even among the supporters of the drug war – was swift and rightly so. Kian was executed. It was murder. Even at one point in Thursday’s senate hearings, PNP Chief Bato de la Rosa exclaimed: “Nakatalikod at babarilin mo? Kriminal ka!” The involved policemen tried – unsuccessfully though – to brand the dead teenager as a drug courier, a charge vehemently denied by Kian’s family, friends and neighbors. But even if true, the allegation was completely irrelevant, as pointed out by Senator Frank Drilon. The point was whether or not the three policemen correctly followed protocol. The double irony in the case of Kian was that he and his family supported President Duterte, believing that Duterte would end the scourge of drugs. Kian, who dreamed of one day becoming a policeman, died in the hands of policemen. Thank God for CCTV. At least in Kian’s case, overzealous enforcers - who may have misinterpreted the President’s assurance that no policeman or soldier would go to jail for doing their job – are not about to get away. Ninoy’s murder This reminds me of what happened 34 years ago. At that time, news reporting was very much controlled by government. Unless one was actually at the Manila International Airport, one would not have known what really happened to Ninoy Aquino that fateful day of August 21, 1983. The official version peddled by the government-controlled media was that Ninoy was shot down by Rolando Galman as Ninoy deplaned from the China Air Line which brought him home via Taipei. Galman, in turn, was gunned down by elements of the Aviation Security Command (AVSECOM). Nice and neat story. Unfortunately for Ninoy’s executioners , they were also caught on cam. Foreseeing something untoward would happen, Ninoy invited some journalists, including TV crews, to accompany him on his journey home. One cameraman documented how AVSECOM soldiers boarded the plane and fetched Ninoy from his seat. As Ninoy and his soldier escorts exited the plane, one of the soldiers blocked the news crew and tried to cover the camera lens with his palm. The plane’s door was immediately closed, preventing newsmen from following Ninoy and his escorts down the ramp. But the camera kept rolling. Within 7 seconds, the camera clearly picked up the command “Pusila, Pusila”. A couple of seconds later, one shot rang out, immediately followed by a staccato of gunfire. The next scene showed Ninoy sprawled on the tarmac, blood oozing from his lifeless body. The body of the alleged gunman also lay on the tarmac. Because of the timing of the first shot, investigators later established that Ninoy was still descending from the plane ramp when he was shot at the back of his head. No way could Rolando Galman, the alleged gunman, have penetrated a supposedly tight security cordon and assassinated Ninoy. The video clip soon became “viral”. Of course, at that time, there was no internet. But copies of the video clips were manually reproduced on Betamax tapes and clandestinely circulated in private homes and later, in offices. I believe that these video clips played a vital role in conscientizing Filipinos, who until then had grown numb of the excesses of martial law. The silent protests in the homes and offices soon spilled into the streets. It took another three years to end two decades of Marcos rule but the protests in 1983 -sparked by the murder of Ninoy on the tarmac – marked the beginning of the end.

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Muntinlupa nearing the century mark

July 12, 2019

Up to 1901,  Muntinlupa was part of Morong District (which was later renamed Rizal Province).  Two years later,  the Philippine Commission decreed – for reason unknown - that Muntinlupa should be part of  Laguna, more specifically, the town of Biñan.        But town residents, led by Marcelo Fresnedi,  felt a closer affinity to the province of Rizal.  Upon their petition,  Muntinlupa once again became part of Rizal, but as a barrio of Taguig.   During  the next twelve years,  residents dreamed of becoming a separate municipality.  They finally got their wish on December 19, 1917 (exactly 99 years ago today), when Governor General Francis Burton Harrison signed Executive Order 108, creating the Municipality of Muntinlupa. Vidal Joaquin became its first Mayor.   The name Muntinlupa (literally “small land”) is actually a misnomer. With a land area of  46.7 square kilometers, Muntinlupa is actually the fourth  largest political unit in Metro Manila, next only to Quezon City, Manila and Makati.   Formerly ranked as a 5th class municipality in the late ‘80s, Muntinlupa metamorphosed into a highly urbanized  first class city  in 1995. Thanks, in large measure,  to the  confluence of good geography,  a very supportive community and good local governance.   Depending on which direction one is headed, Muntinlupa can be considered either as the Gateway to Metro Manila or the Gateway to the fast-developing Calabarzon. With its huge tracts of prime land beckoning developers, Muntinlupa is definitely a prized business destination.   When one flies over Muntinlupa, one can not help but notice large patches of green, a rarity in highly urbanized Metro Manila. This phenomenon has earned Muntinlupa its title as “Emerald City of the South”.   Up to the 1930s, Muntinlupa was mainly a fishing and farming community. Things  changed with  the relocation of the New Bilibid Prison from its old site in Oroquieta, Manila and the establishment of  the Alabang Stock Farm.    During the war, Filipino political prisoners were locked up in Bilibid only to be sprung free from their Japanese captors by the famed Hunters ROTC guerrillas.   The Alabang Stock Farm became famous not only for producing breeding stock for dispersal but also for its Serum and Vaccine Laboratory (SVL).  SVL was the only producer in the country of anti-venom serum, among other vaccines.     But just outside the boundaries of  these two public institutions, was a virtual wild west. President Fidel V. Ramos  recalls that one of his earliest assignments as a young Constabulary officer was to chase cattle rustlers in the vicinity of  present-day  Alabang Town Center.  Decades later, PFVR was among the first to relocate to Muntinlupa when Ayala Alabang opened.   What probably brought impetus to Muntinlupa’s development was the construction of a single lane dirt road,  cutting across former rice fields,  which connected  Highway 54 (now called EDSA) to the Alabang Junction.  The dirt road was meant as short cut for around 10,000 Boy Scouts who were supposed to attend the  1958 10th World Jamboree in Mount Makiling, Laguna.   The dirt road eventually  become the South Super Highway. It was not long before factories started sprouting on both sides of the highway. Because of its proximity to Makati,  Muntinlupa benefitted from  the southward expansion of business.  First came Ayala. Much later, Filinvest and other top business names.   At the local government, things also started to pick up. The LGU tapped various stakeholders – principally the newly-relocated business leaders who made Muntinlupa their second home.  Together with representatives from Muntinlupa’s  other sectors, they  helped craft a strategic development plan which aimed, among others,  to make Muntinlupa a very business-friendly and green community.   Post-Edsa, Muntinlupa was the first Metro Manila  LGU to fully computerize its real property tax administration (RPTA), making it number one (per the Department of Finance) in realty tax collection efficiency.  By 1987, a one-stop one-shop business environment was fully in place.   Human resource development  took center stage  alongside  infrastructure development.  Public  education was boosted with the establishment of the Muntinlupa Polytechnic College (now Pamantasan ng Lungsod ng Muntinlupa), the Muntinlupa Science High School, and the Muntinlupa Business High School.     Muntinlupa expanded its public health program with the opening of Ospital ng Muntinlupa  and the refurbishing of city health centers. Muntinlupa gave meaning to accountability and transparency  by institutionalizing its  annual State of the Municipality (now City) Address. Muntinlupa also actively promoted sister city relationships with both international and local counterparts.   Muntinlupa is currently headed by Jaime R. Fresnedi (City Mayor) and  Rufino Rozanno Biazon (Congressman). The following make up the City Council: Celso A. Dioko (Vice Mayor and Presiding Officer), Councilors (District I): Ivee A. Tadefa, Atty. Patricio L. Boncayao, Jr., Bal Niefes, Stephanie G. Teves, Louisito A. Arciaga. Allan Camilon, Ringo A. Teves, Alexander B. Diaz. Councilors (District II): Christine Abas, Grace Gonzaga, Ma. Dhesiree G. Arevalo, Lucio Bago Constantino, Victor Ulanday, Marissa Rongavilla, Rafael T. Sevilla, Lester Baes.   Year after year, Muntinlupa has been recognized for achievements in various fields of governance.   To mention just some of  the most recent awards:   ISO 9001 – Quality Management System (City Government of Muntinlupa, Ospital ng Muntinlupa, Pamantasan ng Lungsod ng Muntinlupa); Seal of Child-Friendly Local Governance (from DSWD and DILG); Runner-up, International Best Practice Competition (from Asian Productivity Organization and Development Academy of the Philippines  (2015); Seal of Good Financial Housekeeping (DILG); Seal of Good Local Governance (DILG); Special Citation as Most Business-Friendly LGU (PCCI); Excellent Rating  on Anti-Red Tape  (Civil Service Commission). The city police force was rated “Best in Crime Solution Efficiency” in 2015.

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Take a bow, P/SGMA

July 12, 2019

Gloria Macapagal Arroyo has many “formers” in her colorful resume: former academician, former government technocrat, former Senator, former Vice President cum cabinet member, former President, former detainee, former House Speaker.  She is only the second woman to become  President of the Philippines. But she is the first and so far the only female Speaker of the House of Representatives.  She is only the second President to be criminally charged and detained.  But justifiably, the Supreme Court, voting 11-4, dismissed the charges against her. In effect, the high court ruled that she did not pocket P50 million of PCSO funds as alleged.  She did not pocket P1 million. She did not even pocket a single peso.  Compared to both her predecessors and her successors, Arroyo is the least popular.  But she delivered where it counted most. Being only the second economist to be elected President  (her father  President Diosdado Macapagal was the first) she was laser-focused on growing the economy and in significantly reducing the country’s poverty incidence.  Even her harshest critics will find it difficult to dispute these numbers which my good friend Tony Lopez of BizNewsAsia likes to highlight.  During her tenure as President, Lopez asserts,  Arroyo nearly tripled the size of the Philippine economy from $74 billion in  2001 to more than $200 billion in 2010.  Governor/Congressman Joey Salceda - a former student to whom the President gave the highest marks in her economics class - credits the Arroyo presidency for establishing a record period of continuous quarterly growth even at the height of the 2008 global financial crisis when other economies floundered.  During her 9 year presidency, the poverty rate dropped 13 percent – from  39 percent to 26 percent.  Incoming House Majority Floorleader Martin  Romualdez attributes this to Arroyo’s pro-poor projects like the affordable housing units and conditional cash transfer program for the poorest f the poor. Analysts attribute Arroyo’s achievements to her bold, albeit unpopular, fiscal reforms.  The principal of these was the implementation of the EVAT which provided the wherewithal which allowed her administration to invest in human and physical infrastructure.  Good macro-economic fundamentals eventually resulted in an investment grade rating for the country.  The improved rating, in turn, has made the Philippines more attractive and more competitive in the global stage.  The one-year stint of Arroyo as House Speaker in the 17th Congress was no less productive.  The legislative priorities of the Duterte administration – identified in the last SONA – were all passed.  Among them were the Bangsamoro Organic Law (BOL), measures helping coconut farmers and fisherfolks, the second tranch of the tax reform law or the Trabaho bill, and the expanded PhilHealth coverage. Arguably, her career is ending on a high note.  I had the privilege of serving as her Press Secretary/Presidential Spokesperson for almost six years. My tenure was longer than the average shelf life of a cabinet member in that high-pressure job.  At one time, I even served as Acting Executive Secretary.  Up close and personal, I had the opportunity to observe and admire her best traits -  hard work, discipline, decisiveness, and deep abiding faith.  Good luck, Mrs. President/Mrs. Speaker. God speed.

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Climate change compounds hunger and conflicts

July 10, 2019

There are still people on this globe proclaiming that there is no climate change. It's useless to convince them any more. Fact is: the climate changed already massive and added to warfare worsening hunger and conflicts worldwide, according to one of Germany's largest aid groups. Welthungerhilfe has said many poor have "no more reserves or resilience left" when hit by extreme weather.      The world's southern hemisphere poor were bearing the brunt of climate change caused by rich, fossil-fuel consumers of the global North, Welthungerhilfe President Marlehn Thieme said in Berlin several days ago.      Presenting the Bonn-based organization's annual report for 2018, Thieme said climate change amounted to a "question of justice" in ensuring that resources — still sufficient worldwide to feed everyone — reached the poorest.      Hunger victims, often already cut off to outside help by conflict parties, no longer had livelihoods and sustenance as droughts, floods and storms wrecked their fields and eliminated their farm animals.      Yes,  climate change threatens peace efforts. Climate change is threatening the success of peacekeeping missions, according to a briefing by the Stockholm International Peace Research Institute (SIPRI) circulating on Tuesday. Eight of the ten countries hosting the biggest multilateral operations "are located in areas highly exposed to climate change," it said.      Germany pushes climate change as security risk. Floods, drought and mass migration: all factors why Germany has made the UN's response to climate change its priority at the Security Council. But political roadblocks at home and abroad could complicate action.      School Feng ShuiIf we watch around, we can easily notice, that weather extremes are compounding plight. Citing Cyclon Idai, which in April ravaged Mozambique, Malawi and Zimbabwe, President Thieme said weather extremes had become an additional "fatal link" hampering aid workers and restoration of communal nutrition.      Drastic declines in land and oceanic harvests amid rising average temperatures required answers in the form of early warning systems, weather insurance and drought-durable seeds.      Allow me to quote Welthungerhilfe's Secretary General Mathias Mogge. He said, "Coupled with warfare, in which conflict parties cut off entire regions from the outside world, extreme weather was a compounding factor".      The spiral of conflict is becoming more and more dramatic. Villagers are loosing their entire livelihoods. Resources like water and grazing land became scarce, leading to further conflict, in societies where people already had little to withstand emergencies.      Reporting on its 2018 efforts, Welthungerhilfe said it had spent €213.6 ($243) million on the fight against hunger and poverty last year. Public donors provided €155.4 milliion for project work. Private donations amounted to €54.9 million. The largest public donor was the German Federal Ministry for Economic Cooperation and Development (BMZ), which provided €38.6 million.      Hunger, thirst and conflicts because of climate change - meanwhile a never-ending story. Daily in our news. Global and local news. We can't keep our eyes closed any more. +++      Email: doringklaus@gmail.com or follow me in Facebook, Linkedin or Twitter or visit my www.germanexpatinthephilippines.blogspot.com or www.klausdoringsclassicalmusic.blogspot.com.

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