PHILDEVFINANCE (old news)

Monday, October 31, 2011

P1.8-M released thru credit surety fund

by Mera Grace E. Apuya/DavNor PIO

DAVAO DEL NORTE, Oct. 28 (PIA) -— Just as it celebrates its 2nd year,
the Davao del Norte Credit Surety Fund (DNCSF) got P1.8-million worth of
loans released to two of its coop members.

During its 2nd Annual General Assembly with the theme, "DNCSF: Second
Year of Delivering Novel Credit Service Facility for MSMEs," two checks
worth P1-million and P800,000 were turned over to the Central Tadeco
Multipurpose Cooperative and Davao Integrated Resource Cooperative,
respectively, from the Development Bank of the Philippines (DBP) in
Capitol, Tagum City.

DBP is one of the partners of the province in its implementation of the
CSF program of the Bangko Sentral ng Pilipinas (BSP) together with Land
Bank of the Philippines and the Industrial Guarantee and Loan Fund.

Loans amounting to P11-million have been approved since the DNCSF's
inception in 2009.

According to Director Rosalinda Dumaliang of the BSP Department of Loans
and Credit, in her message delivered by Bank Officer II Michelle Samson
during the recent assembly, "P8.7-million has been released to 91
borrowers" through the DNCSF which is the "most number of unique
beneficiaries of any CSF nationwide."

This and the gradual optimization of the "utilization of its available
credit line," Dumaliang said, made DNCSF the second Most Outstanding in
the country next to Cavite.

Dumaliang said "the DNCSF alone have the potential to extend CSF loans
of up to P37-million." She commended the officers of the Oversight
Committee and Sub-Committees headed by Celso Cubio, Sr. as Chair.

According to Cubio, they have been visiting local government units
(LGUs) to encourage more cooperatives to participate in the program and
they're planning to double their efforts for the year 2011-2012. Cubio
was reelected Chair of the Oversight Committee during the election in
the assembly.

"There are still a lot of coops that have not availed of the program,"
said Cubio. "With Engr. Humber Cabunoc, we plan to go to every
cooperative and hear personally from them how the program would be of
help for our intention here is to address the needs especially of
small-scale coops."

Engr. Cabunoc is the Chief of the Cooperative Development Division under
the Provincial Planning and Engineering Development Office (PPEDO)
headed by Engr. Jean Rabanoz.

In his message, Board Member Alan Dujali, Chair of the Committee on
Cooperatives and Livelihood, said that the program not only "encourages
more economic activities, job opportunities, less susceptibility to high
cost of borrowings like five-six and loan sharks" but also "the
underground economy to come out in the open."

However, according to Rabanoz, "much is still to be desired in terms of
empowering financially-challenged entrepreneurs and of getting MSMEs
(Micro, Small and Medium Enterprises) out of the bondage of informal
lenders that gives excessive interest rates."

Moreover, Cabunoc is optimistic that with the current success of the
DNCSF, it can facilitate the release of more funds, twice as much as
what had been released this year.

"We will work harder to land 1st place next year," said Cabunoc.

Representing Gov. Rodolfo del Rosario, Vice-Governor Victorio
Suaybaguio, Jr. asked the coops to continue pursuing "sound management
planning and wise investment of its capital for the benefit of their
members." By Mera Grace E. Apuya/DavNor PIO

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Nueva Ecija backs up cooperatives to create more jobs, improve income

by Lyndon R. Plantilla

CABANATUAN CITY, Nueva Ecija, Oct 28 (PIA) -- Investing in cooperatives
makes sense as these organizations create jobs and livelihood for
people, an officer of the provincial government of Nueva Ecija said.

Dr. Raymond Sarmiento of the Provincial Cooperative and Entrepreneurship
Development Office said, they teach cooperatives survival skills like
basic organization, management and administration, bookkeeping, and
accounting to keep them in business.

Nueva Ecija approximately has around 300 cooperatives which include
farmers, employees, dairy producers, and others.

Most cooperatives are engaged in the production of vegetable noodles,
dairy products, milk and fruit juices, sausage and processed meat
products, fresh and processed mushroom, organic beauty products,
handicrafts, and novelty items like creative lamps.

Dr. Sarmiento said monetary capital can go as low as P15,000 for a
cooperative with 15-20 members.

PCEDO, together with the Provincial Cooperative Development Council and
League of Cooperative Development Officers of the Philippines, opened a
three-day trade fair at the Freedom Park recently.

The event was graced by Governor Aurelio Umali, Representative Cherry
Umali, and former Senator Butz Aquino.

A number of the towns and cities of the province exhibited their top
products like baskets, beauty products, food items, fruits, and
vegetables at very affordable prices. (WLB/LDRP PIA-3)

Sunday, October 30, 2011

Puregold, Globe team up for mobile loading service

By Mary Ann Ll. Reyes (The Philippine Star) Updated October 30, 2011
12:00 AM

MANILA, Philippines - Puregold Price Club Inc. has partnered anew with
Globe Telecom, this time for point-of-sale (POS) commercial load service
which will allow Globe Autoload Max (AMAX) dealers to purchase Globe and
TM prepaid load credits at Puregold branches nationwide.

By opening the POS commercial load service, Globe AMAX retailers will
now be able to buy prepaid credits for as low as P500 to as much as
P150,000 in all checkout counters of any Puregold branch. The commercial
POS loading is exclusively available to Globe AMAX dealers who are also
members of Puregold's Aling Puring (AP) program which provides free
entrepreneurial trainings and seminars as well as freebies and special
discounts from Puregold.

AP members are also given free Super Suki SIM that comes with special
call and text rate and can be used as an AMAX SIM for business.

"Prepaid cellphone load is just as basic a need as food nowadays. With
the availability of POS commercial reloading in Puregold check-out
counters, we are providing our members the opportunity to shop not only
for their supplies but for their loading business as well, all under one
roof," Puregold merchandising and marketing director Vincent Co said.

For his part, Globe consumer sales group head Ramon Matriano explained
that with their tie-up with Puregold, Globe's load retailers are given a
simple, secure and easy way of topping-up their AMAX account. "We see
this joint service from Globe and Puregold spurring an increase in
micro-entrepreneurs, especially since this will expand our commercial
reload channels in the communities," he said.

To purchase prepaid load, retailers simply need to give the mobile
number to the cashier at any check-out counter and indicate the desired
amount of load to buy. The service provides instant virtual credit upon
payment. Customers also get instant confirmation of their transaction
via text, with the receipt as additional proof of purchase

As a special promotional offer, AP members who purchase their commercial
load credits at Puregold check-out counters get free Aling Puring
points. For every P1,500 and P3,000 commercial load purchased, the
customer will get 10 and 30 Aling Puring points, respectively. Points
earned are equivalent to rebates which can be redeemed and used as
tender in shopping at Puregold Price Club and Puregold Extra branches.

Puregold is one of the fastest-growing hypermarket and supermarket
chains in the country, with about 80 branches to date. The company
expects to close 2011 with 100 stores in Luzon and 150 stores in 2013.
Puregold is eyeing stores in key cities, including Davao, Rizal, Cavite,
Bataan, Pangasinan, Baguio City, Ilocos Norte, Caloocan, Bulacan,
Camarines Sur, Laguna, Quezon City, Legaspi City, Iloilo City, Leyte,
Cebu City, Tarlac City, La Union, and Albay.

Last March, Puregold, in tandem with Globe, became the first hypermarket
store in the country to introduce the point of sale (POS) loading
service for personal load top-ups.

BSP sets measures to boost co-op banking sector

By Lawrence Agcaoili (The Philippine Star) Updated September 19, 2011
12:00 AM

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) has tied up
with state-run Philippine Deposit Insurance Corp. (PDIC) and Land Bank
of the Philippines for a coordinated incentive program designed to
support the development of a stronger cooperative banking sector.

BSP Governor Amando Tetangco Jr. said the Strengthening Program for
Cooperative Banks (SPCB) would ensure that cooperative banks could meet
the capital requirements set by the central bank.

"The cooperative movement is an important movement in the society. It
empowers the members of the community that are, that were probably, they
don't have the same access as the big companies and major corporations,"
Tetangco told reporters.

Data from the BSP showed that there are 40 operating cooperative banks
in the country with resources aggregating P15.9 billion as of end-March.

While the assets of the cooperative banking sector accounts for only a
small fraction of the assets of the entire banking system, the BSP said
it plays a vital role in the financial system since almost all of these
40 cooperative banks operate in the countryside

These banks, according to the central bank, provide the much needed
financial services to hundreds of primary and federation cooperatives
and their individual members who usually face difficulties in accessing
banking services.

"The same cooperatives and the large number of their individual members
are the stockholders or owners of cooperative banks. Thus, there is much
social benefit in revitalizing this particular segment of the banking
system," the BSP said.

The BSP would implement the coordinated incentive program that would run
until August 2012 and is designed to support the development of a
stronger cooperative banking sector together with PDIC and Landbank.

The program encourages mergers, consolidations with or acquisitions of
cooperative banks, particularly those that are capital deficient, by
eligible strategic third party investors (STPIs) under a specific set of
guidelines.

It is aimed at rationalizing the cooperative banking sector to bring
about larger and stronger cooperative banks whose management, more solid
capital position, and wider branch network would enable them to improve
their services to cooperative members, deepen their reach into the
countryside, mobilize savings, and spur lending activities in the
unbanked and the underserved areas.

"The SPCB offers a variety of incentives to cooperative banks and their
partner STPIs, and these include targeted financial assistance to
augment capital, credit facilities to support business expansion, and a
package of regulatory relief," the BSP added.

Under the program, PDIC and Landbank would provide the critical support
component through a financial assistance.

Through the SPCB, surviving cooperative banks or banks at least 67
percent owned by cooperatives are expected to have a much improved
capital position with a net worth of at least P100 million and a minimum
risk-based capital adequacy ratio (RBCAR) of 15 percent.

This, the BSP said, would place the surviving banks in a better position
to expand their lending activities and provide a wider variety of
innovative financial services especially catered to primary cooperatives
and their members.

Equity would be infused by the PDIC and Landbank into the STPIs to
neutralize the potential adverse impact of asset write-downs that are
essential to clean up the books and ensure that surviving banks are
strong and capable.

Equity infusions would come in the form of perpetual, non-cumulative
preferred shares, convertible to common shares at the end of 10 years.
An exit mechanism provides for the buy-out of government shares after 10
years.

In addition to equity infusion, credit facilities would also be made
available by Landbank to enable STPIs to further scale up their
operations at an accelerated rate.

On the other hand, the BSP would provide complementary regulatory
support package to further enable the surviving banks to expand their
operations.

The regulatory support package includes flexibility in the opening,
conversion and relocation of bank offices, including head offices,
flexibility in ownership limits, more liberal guidelines that would
allow staggered booking of required valuation reserves, waiver of
penalties as may be appropriate, and the restructuring of existing
rediscounting and emergency loans with the BSP.

Eligible STPIs may be cooperative banks, thrift banks, rural banks,
primary cooperatives or federations of cooperatives provided such
entities have a CAMELS rating of at least 3, are not under the central
bank's Prompt Corrective Action Framework and have not been cited by the
BSP or the PDIC to have engaged in any unsafe and unsound banking practice.

Where the STPI is a rural or thrift bank, the bank should also be at
least 67 percent owned by cooperative banks, primary cooperatives and/or
federation cooperatives.

The eligible STPIs are also expected not only to sustain and continue to
improve the capital base, but also to further strengthen the quality of
corporate governance and management systems thereby making such banks
that serve the cooperative sector truly sustainable, viable, and efficient.

Even before operating guidelines are released by the BSP, PDIC, and
Landbank, strong expressions of interest to participate in the program
have been received from a number of players in the industry indicating
the strong buy-in of the cooperative sector.

In August last year, a similar program for rural banks dubbed as the
Strengthening Program for Rural Banks (SPRB) involving P5 billion in
financial assistance was launched. To date, not a single transaction has
been completed.

Smart finalist in global mobile money contest

(The Philippine Star) Updated October 25, 2011 12:00 AM

MANILA, Philippines - Smart Communications Inc. (Smart) had been named
among the finalists in the upcoming Mobile Money Global Awards. The
country's leading wireless services provider is the only Philippine
telecommunications company to make it to the elite list.

Smart's mobile commerce offering, Smart Money, was shortlisted in two
Mobile Money Transfer (MMT) categories – the Best Operator-led MMT
Program, which is given to the MMT model with exceptional subscription
and usage rates, customer reach and ease of service; and the Best
Bank-led MMT Program, which recognizes the outstanding mobile money
transfer model with a banks' market entry strategy.

Smart Money has established linkages with the leading banks of the
Philippines, the country's primary ATM consortia, local and
international remittance companies, and millions of MasterCard partners
here and abroad.

The platform allows account holders to perform mobile money transfers,
pay bills, purchase goods and services from partner MasterCard
establishments around the world and on the worldwide web, to do
over-the-counter transactions at Smart Wireless Centers and Smart Money
Centers, and to withdraw from over 7,000 ATMS all over the Philippines.

There are currently over 8.5 million registered users of Smart Money.

Likewise, Smart Load and Financial Services head Jojo M. Malolos has
also been included in the pool of speakers in the Mobile Money Global
Summit and Expo to be held in Dubai next month.

Aside from Best Operator-led MMT Program and Best Bank-led MMT Program,
other categories include Best Mobile Money Launch of the Year,
Achievement in Financial Inclusion, Best Mobile Money Joint Venture
between a Bank and an Operator, Most Inventive Marketing Campaign, and
Best International Mobile Money Transfer Program.

Now on its 2nd year, the Mobile Money Global Awards recognizes mobile
money pioneers, practitioners, and stakeholders who have made
significant contributions to the growth of the mobile money industry.

Saturday, October 29, 2011

SMART Money for rural banks in Mindanao

The United States Agency for International Development Agency-supported
Rural Bankers Association of the Philippines – Microenterprise Access to
Banking Services (RBAP-MABS) Program and SMART Communications, Inc.
(Smart) held the first Regional RBAP-SMART Money Accreditation Training
Workshop last October 05 at Naomi's Botanical Garden and Tourist Inn,
Ozamiz City.

The twenty-eight (28) rural bank participants had a first-hand
experience in understanding how they could assist their clients to
receive and activate their SMART Money Instant Cards and perform
Money-In Money-Out (MIMO) transactions. The course also briefed the
participants on the basics of SMART Money, the responsibilities of being
a partner SMART Money Center and the proper handling of MIMO
transactions, pre-funding of SMART Money wallets, consolidation,
settlement and reconciliation of encashment, appropriate security and
internal control measures that banks should have in place, accounting
entries, as well as proper tracking and monitoring SMART Money
transactions. All the training materials included step-by-step
procedures with a detailed checklist of requirements and templates to
assist rural banks to quickly become accredited to offer Smart Money
services. SMART's Communications Karlo Pereyra, Product Manager for
rural banks and Chris Chua, Account Manager for Visayas and Mindanao led
the pool of trainors including three colleagues from SEED Finance.

Among the rural bank participants were representatives from 1st Valley
Bank, Inc., Banco Dipolog, Inc., Rural Bank of Oroquieta, Inc., Cantilan
Bank, Inc. (A Rural Bank), One Network Bank, Inc. (A Rural Bank),
Katipunan Bank, Inc., Cooperative Bank of Misamis Oriental, Rural Bank
of Tuleda, Rural Bank of Lopez Jaena, Inc., Rural Bank of Jimenez, Rural
Bank of Pana-on, Rural Bank of Kulambugan, Salug Valley Rural Bank,
Inc., Rural Bank of Tangub City and Rural Bank of Bonifacio.

Smart Money is the world's first reloadable payment card linked to a
mobile phone. It is an electronic wallet that allows Smart subscribers
to send and receive money transfers, pay bills and load airtime.
Accredited rural banks will also be able to provide their clients with a
Smart Money Instant Card, which doubles as both a debit MasterCard and
an ATM card. This will enable clients to withdraw from an over 9,000
BancNet and Megalink ATMs, load in over 4,000 Money-In and Money-Out
Centers, 15 partner banks nationwide and 95,000 partner agents
worldwide. Clients will also now be able to make purchases or payments
in more than 50,000 local merchants and business and more than 24.6
million MasterCard locations worldwide.

Rural banks are definitely excited about offering their clients a mobile
wallet that is linked to an international accepted MasterCard debit
card. What is even more important for the banks and clients is that this
can be processed in minutes with an instant Smart Money card in the
client's hands.

Friday, October 28, 2011

Prepaid electricity favored, Meralco claims

CUSTOMERS of distribution utility Manila Electric Co. (Meralco) favor
prepaid electricity as it is easier to manage the household budget, the
company said in a statement yesterday.

"Prepaid and buying 'tingi' or sachet is ingrained in the Filipino
lifestyle. Many wage earners receive daily or weekly pay, so they would
prefer that their expenses -- from mobile to Internet and yes, to
electricity -- be also on a 'tingi' basis," said Alfredo S. Panlilio,
Meralco senior vice-president for Customer Retail Services, in the
statement.

Mr. Panlilio added: "This enables [consumers] to bridge the timing of
their cash outflows. If this can be made possible, they will avoid the
monthly experience of having to pay a one-time big-time amount."

Meralco based its findings on a consumer analysis research it conducted
with General Electric. The survey was done in the second half of this
year and had more than 400 respondents.

The survey also showed prepaid electricity could be used as a budgeting
tool that will teach household members to save and share expenses.
The power distributor is set to pilot prepaid metering early next year,
and will roll out the system on a wide scale later that year.

To avail of the service, Meralco customers will provide vendors a
subscriber information number. Vendors will then top up electricity
credits through text messaging.

Consumers will be informed through texts as well if the credits have
been loaded or if it has already run out. The distributor earlier said
it plans to pilot-test smart meters, or meters that work with the
prepaid electricity system.

Mr. Panlilio said the study produced "valuable insights about how
customers view prepaid electricity and this will guide Meralco in
designing the service."

"We are working hard to be able to satisfy customer needs and we will
continue to invest in innovations and customer solution initiatives to
make life easier for all Meralco customers," said Mr. Panlilio.

Meralco's reported net income rose 26% to P6.09 billion in the first
half of the year, from P4.9 billion in the same period last year.
In 2009, Meralco saw a change in management with Manuel V. Pangilinan of
Metro Pacific Investments Corp. (MPIC) took over as chief executive of
the utility.

Metro Pacific is the local arm of Hong Kong's First Pacific Co. Ltd.,
which partly owns the Philippine Long Distance Telephone Co. (PLDT).
Mediaquest Holdings, Inc., a unit of the Beneficial Trust Fund of PLDT,
has a minority stake in BusinessWorld. -- Emilia Narni J. David

Landbank extends P4.8B in farm loans

STATE-RUN Land Bank of the Philippines (Landbank) has released P4.8
billion worth of loans as of September for a program that seeks an
increase in farm output.

Landbank, in a statement yesterday, said the loan releases under the
Food Supply Chain Program financed 75 projects involving 75 anchor firms
and 288 cooperatives, farmer organizations and non-government
organizations since the program's launch in October last year.

The projects financed by the program, it said, included integrated corn
production and hog fattening; oil palm production and processing; fruits
and vegetable production and processing; rice and corn production,
processing and trading; cardava banana production and processing; fish
production and processing; onion production, cold storage and marketing;
and sugarcane production and milling.

Gilda E. Pico, Landbank president and chief executive officer, said the
bank was focused on supporting the program in line with the government's
aim of promoting food security and increasing agricultural productivity.

"The Food Supply Chain Program is a fitting platform to provide
financial and technical support along the value-added chain of a
commodity and help increase the income of small farmers, fisherfolk, and
SME (small and medium enterprises) producers whom we are committed to
help," she was quoted as saying in the statement.

The Food Supply Chain Program was designed to provide credit assistance
to key players in the food system, provide market linkages between
agricultural producers and processors as well as improve the capacity of
farmers' organization to meet product requirements of anchor firms.

Anchor firms that are part of the program purchase the produce of
cooperatives and farmers organizations as well as provide technical
assistance to improve productivity and product quality. -- L. D. Desiderio

Tuesday, October 25, 2011

Smart finalist in global mobile money contest

(The Philippine Star) Updated October 25, 2011 12:00 AM Comments (0)

There are currently over 8.5 million registered users of Smart Money.

Likewise, Smart Load and Financial Services head Jojo M. Malolos has
also been included in the pool of speakers in the Mobile Money Global
Summit and Expo to be held in Dubai next month.

Monday, October 24, 2011

Co-ops seek shield from ailing banks, bad banking

9:38 pm | Thursday, October 20th, 2011

LA TRINIDAD, Benguet—The Cooperative Development Authority (CDA) has
sought the help of the Bangko Sentral ng Pilipinas (BSP) after learning
that the collapse of the LBC Development Bank in September hurt the
finances of some Baguio-based cooperatives.

One cooperative reportedly lost as much as P25 million. Another lost P3
million, "but the insurance coverage offered to redeem the money was not
even half of what we lost," one of its officials told the Inquirer last
week.

Franco Baoang, acting CDA Cordillera director, said the agency may need
new guidelines and quarterly appraisals of the banking industry to help
cooperatives make informed decisions about their transactions.

Aside from depositing money or securing loans, many cooperatives also
lend money to members which require a stable supply of funds, said
Martin Manodon, CDA Cordillera spokesperson.

'Usually sound'

"Usually, a cooperative's assets are sound because the members
themselves are the ones who invest actively in [its] projects," Manodon said
Baoang said the common problems arising from managing cooperative
financing are internal because of poor accounting or wrong business
decisions.

But the LBC bank case showed that the fate of cooperatives is also
vulnerable to external forces, such as transactions with poorly managed
banks or an economic crisis.

The Inquirer could not get independent verification of the losses from
the local branch of LBC, a thrift bank, which was placed under
receivership by the Philippine Deposit Insurance Corp. on Sept. 9.

Miguel Luma-ang, general manager of the Cooperative Bank of Benguet,
said the LBC example strengthens a campaign to draw the assets of all
cooperatives in the country under the custody of a central cooperative
bank facility.

Merge for strength

In 2010, the BSP issued a policy statement urging rural banks, thrift
banks and cooperative banks to merge to become competitive against
commercial banks owing to the perceived fragility of smaller,
independent banks, information supplied by the Cooperative Bank of
Benguet showed.

Luma-ang, who is also president of the Benguet Provincial Cooperative
Development Council, said his bank is valued at P720 million from the
investments of 90 cooperatives. The bank started with 165
member-cooperatives.

Baoang said regular information about the economy and the strengths and
weaknesses of commercial banks could be incorporated in the CDA's
training programs that are offered to 2,000 Cordillera cooperatives.
Vincent Cabreza, Inquirer Northern Luzon

Sunday, October 23, 2011

Manulife eyes microinsurance in South Phl

By Ted P. Torres (The Philippine Star) Updated September 12, 2011 12:00
AM Comments (0)

MACTAN, Cebu, Philippines — Manulife Philippines will be launching
microinsurance products in Southern Philippines in the fourth quarter of
the year.

"We are just waiting for the approval of the Insurance Commission (IC)
to start selling microinsurance," Indren Naidoo, Manulife Philippines
president and chief executive officer, said.

The initial target will be Cebu and Davao, and subsequently move into
areas outside of the cities of Davao and Cebu.

Naidoo said that they have already tied up with one microfinance
institution (MFI) in Cebu and another two MFI in Davao.

The chief executive pointed out that coming out with microinsurance
products was the easy part. The challenge is to get the right
distribution system in place.

"MFIs are natural partners in the business of microfinance and
microinsurance," he added.

Offhand, the micro product could get a protection coverage of between
P10,000 to P20,000, with double the amount if due to accidental death.
The P10,000 coverage is for a one-month micro product, while the P20,000
is for a three-month product.

Most likely, it will be the first time they will get hold of such
protection, the insurer added.

It also has a broad market insurance product that may cost just P15 per
day with a protection coverage of P65,000, and again double in case of
accidental death.

"Also, 50 percent of the premium will be returned after 10 years," Naido
said.

Microinsurance is not new to Manulife.

Manulife Financial senior vice president and regional executive for
Malaysia, Philippines, Thailand and Vietnam David T. W. Wong said that
they have been successful in selling microinsurance in Vietnam.

"We have already sold 100,000 microinsurance policies in Vietnam," Wong
said.

Overall, they manage over 10,000 agents in Vietnam selling all types of
insurance products including microinsurance. Manulife Financial is
ranked third overall in a playing field of 14, and controlling 12
percent market share.

CARD M-I Agents: Bringing microinsurance down to the grassroots

(The Philippine Star) Updated September 12, 2011 12:00 AM Comments (0)

MANILA, Philippines - A new breed of agents being trained by CARD
(Center for Agriculture and Rural Development) are ready to make
insurance available to every Filipino, even in the vastly untapped rural
areas.

The CARD Microinsurance Agents or MI-Agents, a first in the insurance
industry, are fondly called nanays, but they are tough and focused on
their mission to make it known to more Filipinos that these products are
within their reach.

"Getting through to the grassroots was not possible utilizing the
regular distribution channel of regular insurance products, much more
with the conventional insurance agents," said CaMIA president Alex M.
Dimaculangan. "To be able to reach the marginalized sector, a different
type of distribution network is needed, along with a different mindset
in marketing and sales of insurance products and services."

In the world of microinsurance, accessibility means everything. To the
majority of Filipinos, traditional insurance is deemed inaccessible —
expensive, offered only in the big cities, difficult to maintain. Thus,
as part of its mission to empower the poor, CARD reinforces its
microfinance programs by offering insurance products that are
affordable, leveraging on the strength of its network of members.

Most CARD nanays have experienced first hand the benefits of
microinsurance, and so are easily able to share its value with their
peers. The power of their testimony has convinced many women to set
aside money for coverage that protects their families and property,
Dimaculangan said. "Since the insurance business is based on trust, we
needed a sales force that could be trusted not only by the insurance
provider but by their peers in the countryside."

The CARD nanays have passed certain qualifications including sales
training. As MI-Agents, they are authorized to sell the PAID Plan,
coverage developed specifically for CARD members by CARD Mutual Benefit
Association Inc. [CARD MBA] and the Pioneer Group of insurance companies.

The PAID Plan is affordable and includes personal accident, property
insurance and a funeral benefit. Sales training for MI-Agents began in
December 2009. To date, almost 900 MI-Agents have attended these
sessions; 635 are considered active. Their contribution is invaluable —
the MI-Agents account for 60-70 percent of CaMIA's total monthly
production. They likewise are the link between CARD management and
members, assisting in claims assessment and validation and helping to
address the questions of policyholders through their presence in regular
center meetings.

Fely Chan, an MI-Agent herself, said being a PAID Plan holder has helped
her convince others that the coverage is worth the small investment.

"It helped a lot that I am a PAID Plan holder because I was able to
convince many others to buy. Whenever I explain the benefits these
products offer, I tell them that we ourselves are plan holders," she said.

Chan said there is also an added satisfaction in having sold a product
that truly benefits people. "I'm happy that I was able to help those who
were affected by typhoons. They were able to replace their damaged roofs
through their plans."

This month, CARD bolsters its support for the MI-Agents by introducing
another industry first, the MI-Adjusters or the Microinsurance Claims
Adjusters, whose role is to validate claims, helping to speed up the
process by verifying the claimant's necessary information. When bulk
losses come in due to natural disasters, the MI-Adjusters will provide
much-needed manpower to make certain that the benefits reach
policyholders as soon as possible.

"Working with an organization such as CARD has given us important
lessons on microinsurance," Geric Laude, Pioneer Life vice president for
microinsurance, pointed out. "Through their system of MI-Agents, we are
harnessing the advantages of community to reach out to more Filipinos
with the benefits of microinsurance."

Microinsurance aggresively targeting low-income group

By Ted P. Torres (The Philippine Star) Updated October 23, 2011 12:00 AM
Comments (0)

MANILA, Philippines - The National Credit Council (NCC) said it is
optimistic more Filipinos in the lower income bracket will get insurance
protection with the aggressive growth and introduction of microinsurance.

Already, over two million Filipinos have microinsurance policies and
this is seen to easily double with the recent entry of 50 life and
non-life insurance companies into the microinsurance bandwagon.

This means the mainstream life and non-life insurance firms, not just
the 14 mutual benefit association (MBA), will be selling the new
microinsurance products.

NCC deputy executive director and Department of Finance (DOF) director
Joselito S. Almario said the Insurance Commission (IC) has approved 50
microinsurance products.

MBAs usually have no capital stock, but issue certificates of membership
providing for payment of benefits in case of sickness, disability or
death of members. They have accumulated funds through the collection of
fees or dues from members, at either stated or irregular intervals, with
which to discharge liabilities on membership certificates and with which
to pay the administrative expenses.

Almario explained that microinsurance have lower-priced premiums
although with lower value of claims. The price of microinsurance
premiums range from less than P1 to P20, and with maximum coverage of
P200,000.

"From the 60-day claim period allowed for traditional life insurance, it
will be a maximum 10 days claim payment period for microinsurance," he said.

Microinsurance products introduced by the mainstream life insurers are
similer to their traditional products but in a smaller and cheaper
scale. But it still allows quarter, semi-annual and annual premium payments.

Meanwhile, non-life insurers with their own microinsurance products are
annual in character and time frame, much like their existing personal
accident (PA) insurance products.

To ensure the sustainability of microinsurance, the issuers have turned
to a multi-channel distribution network, such as rural banks,
cooperatives and non-government organizations (NGOs).

The Bangko Sentral ng Pilipinas (BSP) has allowed rural banks to sell or
act as microinsurance agents, while MBAs and other cooperatives have
started adopting the new microinsurance products.

The Rural Bankers Association of the Philippines (RBAP) and its research
and training arm, the Rural Bankers Research and Development Foundation
Inc. (RBRDFI), successfully trained 145 rural banks since January 2011,
and assisted more than 40 rural banks with their microinsurance license
applications.

Bank credit growth remains steady, says BSP

By Lawrence Agcaoili (The Philippine Star) Updated October 23, 2011
12:00 AM Comments (0)

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) reported
that the ratio of bank credit to gross domestic product (GDP) has
remained steady over the past few years amid the economic slowdown in
the US and the debt crisis in Europe.

BSP Governor Amando M. Tetangco Jr. said that bank credit has grown in
line with the activities in the economy as the credit-to-GDP ratio stood
at 39.6 percent as of June this year from about 40.2 percent as of 2006.

"This suggests a relatively stable relationship between economic
activity and credit exposures. The ratio is not too high so as to raise
overheating alarm bells and not too low as to suggest a market without
momentum," Tetangco said.

He pointed out that the BSP expects strong banks to mobilize savings and
then to intermediate the same to borrowers.

"If, however, we take the argument a step further, this relationship
between bank credit and economic growth tells us that banks have the
power of the purse to support the real economy by allocating to
deserving borrowers," he added.

The country's GDP growth slackened to four percent in the first half of
the year from 8.7 percent in the same period last year due to weak
global trade as well as the lack of spending by the government under the
Aquino administration.

This prompted the Cabinet-level Development Budget Coordination
Committee (DBCC) to lower the GDP growth target to 4.5 percent to 5.5
percent from the revised five percent to six percent this year and to
five percent to six percent instead of the revised 5.5 percent to 6.5
percent next year.

Originally, the DBCC penned a GDP growth target of seven percent to
eight percent this year and next year.

Tetangco said the BSP would continue to oversee the banking market
largely along the lines of permissible banking activity and would
provide a framework that balances the competing interests of all parties.

He pointed out that balance is achieved by providing for an enabling
environment.

"Such an environment nurtures entrepreneurial initiatives which can be
achieved with some funding support; protects the rights of the public
who either contribute their saving to the system and/or partake of
products and services; while encouraging innovation so that banks can
address the evolving needs of a differentiated public," the BSP chief said.

Friday, October 21, 2011

Capitalization of local banks exceeds int'l standards - BSP

By Lawrence Agcaoili (The Philippine Star) Updated October 21, 2011 12:00 AM

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) reported
yesterday that banks managed to keep their capital levels significantly
above international standards despite the tensions in the Middle East
and North African (MENA) states as well as the sovereign debt crisis in
Europe.

BSP Governor Amando M. Tetangco Jr. said the capital adequacy ratios
(CARs) of the banking system remained healthy at 16.48 percent on a solo
basis and 17.39 percent on a consolidated basis as of end-March this
year from the revised end-December level of 15.99 percent and 16.93 percent.

"The Philippine banking system's capitalization remained robust despite
geopolitical tensions in the MENA region and concerns over sovereign
risk in Europe," Tetangco stressed.

He pointed out that the system wide risk-based measure of solvency
remained above the central bank's 10-percent minimum requirement and the
international benchmark ratio of eight percent under the Basel Accord.

The CAR is a ratio of a bank's capital to its risk and the central bank
tracks this indicator to ensure that banks have the capability to absorb
a reasonable amount of loss and that they are complying with their
statutory capital requirements.

Data released by the BSP yesterday showed the CAR of universal and
commercial banks improved to 16.42 percent as of end-March from 16.23
percent as of end-December on a solo basis and to 17.42 percent from
17.27 percent on a consolidated basis while that of thrift banks
improved to 16.11 percent from 12.62 percent on a solo and consolidated
bases.

On the other hand, the CAR of rural banks improved to 18.86 percent from
18.2 percent on a solo and consolidated bases while that of cooperative
banks increased to 16 percent from 17.13 percent on a solo and
consolidated bases.

Tetangco reported that the Tier 1 capital ratios of the banking system
remained high at 14.21 percent on a solo basis and 14.23 percent on a
consolidated basis after major players in the banking industry
successfully raised fresh equity through the issuance of various debt
instruments.

As a result, the BSP said the qualifying capital position of the banking
system climbed by 4.4 percent to P744.8 billion as of end-March from
P713.5 billion as of end-December on a solo basis and by 4.1 percent to
P815.3 billion from P783.4 billion on a consolidated basis.

On the other hand, the central bank pointed out that the risk weighted
assets of the banking system inched up by 1.3 percent to P4.519 trillion
as of end-March from the end-December level of P4.461 trillion on a solo
basis and by 1.3 to P4.687 trillion from P4.626 trillion on a
consolidated basis.

"The sustained strength of the banking system's CARs resulted from the
higher growth rate of qualifying capital vis-a-vis that of risk weighted
assets," the BSP chief said.

The qualifying capital of universal and commercial banks went up by 2.9
percent to P654.5 billion from P636.2 billion on a solo basis and by 2.4
percent to P764.6 billion from P746.2 billion on a consolidated basis
due to the additional issuance of common shares by two banks while that
of risk-weighted assets improved by 1.7 percent to P3.985 trillion from
P3.919 trillion on a solo basis and by 1.6 percent to P4.389 trillion
from P4.32 trillion due to the expansion of loan exposures to private
corporations and investments in foreign currency-denominated debt
securities issued by the government.

Likewise, the BSP said the CAR of the thrift banking industry improved
due to the closure of the Aguirre-owned Banco Filipino Savings and
Mortgage Bank that was placed under the receivership of the state-run
Philippine Deposit Insurance Corp. (PDIC) last March 17.

Re: Cordillera cooperatives lend P1.5B, employ 1,400

Sir Caloy,

Thanks for this information. We will plan out, with Sir Danny Mendoza on how we're going to get in touch with these cooperatives in Cordillera.

Best!

Abe P.

On Thu, Oct 20, 2011 at 1:10 AM, CARLOS ANI <carlosani@gmail.com> wrote:

Cordillera cooperatives lend P1.5B, employ 1,400

Published : Thursday, October 20, 2011 00:00 Article Views : 183 Written by : Larry Madarang, Correspondent

LA TRINIDAD, Benguet: Local cooperatives in have contributed P1.5 billion in loan releases as its volume of business in the Cordillera region.
Cooperative Development Authority (CDA) revealed this during the Philippine Information Agency's "Kapihan sa Benguet" over the weekend.

Of the more than a billion in loan releases, P137 million was farmed out to Benguet province, the CDA said, and cited that there is a total of P700 million in sales in the region with Benguet owning P334 million of the P700 million.

The Cordillera region's cooperative sector employs a total of 1,485 individuals and contributes around P85 million in paid wages and salaries, CDA cited.

Currently, there are 701 registered cooperatives with the CDA, 100 of which are newly formed cooperatives.
The cooperatives in the region have a total of P2.7 billion in paid up share capital of its members with a total savings of P995 million.

The CDA aims to increase its cooperative membership base from 7 million members as of present to 20 million members in the next three years.

The CDA will be marking the Regional Cooperative Month on Oct. 26-27, 2011at the Benguet State University Gymnasium here.

Meanwhile, the CDA identified the Baguio-Benguet Community Credit Cooperative (BBCCC), the Baguio General Hospital Multi Purpose Cooperative (BGHMPC), the Benguet Traders Multi Puspose Cooperative (BTMPC) and the Tanudan Saving Cooperative in Kalinga as the top cooperatives in the different categories in the Cordillera region.

The BBCCC tops the large cooperative category with a total assed of P1.1 billion, it is followed by Tabuk MPC; Texins MPC, Philex Credit; Abra Diocesan TE MPC; LAGSADECO; Lagawe MPDDC; Mothers and Family MPC; Besao MPC; and the All Saints Credit.

With the medium cooperative category, BGH MPC with a total asset of P94 million is followed by the Sagada MPC; Tabuk Farmers MPC; BSU MPC; Bavesco; Bad-ayan Bugias; LT Trading Post MPC; Tam-an MPC; Piwong MPC and the BAMAPCOM Entrepreneurs.

For the small cooperative category, the Benguet Traders MPC is followed by the Cordillera OCW; Mabuhay MPC; Aguinaldo Mktg.; BODA MPC; Trinidad based Agawa; Ambigatton MPC; Timber and Lime; Cordillera Homeowners; and the La Trinidad MPC.

While in the micro cooperative category, Tanudan Savings is followed by the LBP Employees MPC; San Ramon MPC; SRT Alfonso Lista; Bagtangan Farmers; Baguio's Finest; Holy Trinity Cathedral; Tawang MPC; Sayapot MPC and the Abreco Employees.

A large scale cooperative has P100 million or more in assets, while the medium category has P15 million to P100 million; a small cooperative has P3 million to P15 million; and the micro cooperative P3 million and below.

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Thursday, October 20, 2011

Servicing the unbanked

BY JUDY T. GULANE, Sub-Editor

Servicing the unbanked

DAVE A. CORPIN, 23, and Elaine L. Darunday, 34, did not own savings
accounts until this year. And yet the two live and work in Metro Manila,
where banks and bank branches are densely clustered.

Mr. Corpin, a customer service representative at the Abenson appliance
store, said his jobs before were temporary and the cash flows irregular.
Ms. Darunday, who works as a nanny in Makati City, simply did not think
of opening an account.

The two then stumbled on the Bank of the Philippine Islands' (BPI) Easy
Saver deposit product, which is geared towards Filipinos like them who
earn relatively low yet regular incomes, and have now started to set
aside a portion of their income each month as savings, saying these will
come in handy during emergencies.

For BPI, the Easy Saver deposit product represents another financial
innovation in the bank's 160 years of existence. Yet, it also helps
address two problems confronting the country today: a low savings rate
and the lack of access to formal financial services for many Filipinos
Low savings rate

Data from the Asian Development Bank (ABD) show that the country's gross
domestic savings rate -- defined as gross savings as percentage of gross
domestic product (GDP) -- stayed low at 18.7% in 2010 from 16.4% in 2000.

Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco, Jr.,
speaking during the launch of a savings product for children in early
August, said that as of March, the 36 million accounts in the country's
banks held P5 trillion in deposits. Yet around 23 million or nearly
two-thirds of these had balances of only P5,000 and below.

Savings are important in funding investments -- which are key to job
creation, long-term growth and poverty reduction.

The Philippines has lagged behind its neighbors in mobilizing savings.
China's gross domestic savings, based on ADB data, was 53% in 2010;
Singapore, 51.9%; Malaysia, 39.2%; Indonesia, 34.2%; Thailand, 33.4%;
and Vietnam, 27%.

Not surprisingly, the country's gross domestic capital formation of
20.5% of GDP in 2010, based on ADB data, was the lowest for this grouping.

The fact that many Filipinos don't have access to banks can explain why
the country's gross domestic savings rate is very low. According to the
BSP, only 26% of the Philippine adult population is "banked" or have
access to formal financial services. A total of 610 or 37% of the 1,634
municipalities nationwide still don't have banking offices.

The central bank cites the country's archipelagic makeup as one reason
for this. It is costly for banks to set up offices all over the country.
Thus, not surprisingly, 50% of deposits are in banks in Metro Manila.
People also feel intimidated by formal institutions, said Pia
Roman-Tayag of the BSP's Inclusive Finance Advocacy Staff.

Why is it important that the "unbanked" have access to formal financial
services? Bangkok-based Alliance for Financial Inclusion (AFI), which
counts developing countries' central banks as members, states on its
website: "It is well-documented that access to savings accounts,
insurance and other financial services is crucial to allow poor people
to invest in their homes and small businesses, weather the impact of
economic shocks, build up savings as financial cushions against
unexpected events and manage uneven cash flows and seasonal incomes."

The AFI, of which BSP Deputy Gov. Nestor A. Espenilla, Jr. is a "policy
champion" for mobile financial services and financial inclusion
strategy, says an estimated 2.5 billion people worldwide, or over half
the world's population, "do not have access to formal financial
services, representing a huge untapped potential for economic and social
development."

With 74% of the country's population unbanked, it is no wonder that
Filipinos, when they do save, keep their money at home. Mr. Corpin said
he did this, adding that his savings simply "slept." Ms. Darunday said
she also used to set aside money at home but this easily dissipated.
BPI gamble

To open an Easy Saver account, one needs to merely pay P50 for the ATM
(automated teller machine) card and make a P200 initial deposit. To
discourage withdrawals, depositors are charged P5 each time they
withdraw from an ATM or P100 if over the counter. There is no minimum
balance rule. If the deposits hit or exceed P1,000, these begin earning
interest.

Mita B. Gozar, vice-president for personal banking, said BPI came up
with the product in the course of thinking of ways to expand its market.
The key, the bank found out, was to change the notion that banks are
"upscale."

"We shifted our focus from deposit volume to the customer," Ms. Gozar
said. "We asked ourselves, 'who are we not serving or under-serving?' We
conducted a research and found that people save but some keep their
savings at home or join 'paluwagan' (informal savings or insurance
schemes) in the office."

BPI did away with oft-cited hurdles to opening savings accounts: a high
initial deposit and a high minimum monthly average daily balance.
(Another BPI savings product, Express Teller Savings, requires a minimum
deposit of P500 and a minimum monthly average daily balance of P3,000.
Deposits must reach P5,000 for these to earn interest.)

The Easy Saver product was pilot-tested in late 2010 and launched
nationwide in March. For a bank such as BPI -- the country's third
largest in terms of total assets and deposits -- it was a big gamble.
"We are the only universal bank in the country that offers such a
product," Ms. Gozar claimed.

The BSP's Ms. Roman-Tayag noted the BPI Easy Saver fits the central
bank's definition of microdeposits, which are not charged any dormancy
fees. "This move, together with other such innovative products by other
banks, promise to bring much-needed financial services to the currently
unbanked," she said.

Mobilizing savings

Mr. Corpin came to know of the Easy Saver product at work, after a
co-employee at Abenson urged him to open an account. BPI, which has a
branch at Walter Mart where the Abenson store that employs him is also
located, held a promo for the product in March.

Mr. Corpin said his Easy Saver deposits were "more secure", and he has
promised himself he would make withdrawals only during emergencies. "I
want to continue saving," he said.

Ms. Darunday said a house helper at the building where she lives and
works told her about Easy Saver. She said she and other nannies went to
BPI's branch at the Power Plant mall in Rockwell Center to open accounts.

Her employer had already told her she should start saving after she was
forced to borrow money to pay for the medical expenses of her
16-year-old son who met an accident. "He told me the savings will come
in handy during emergencies," she recalled. "I now set aside my 'extra'
income as savings. I don't spend it."

Maricris L. San Diego, BPI vice-president for deposits product
management, claimed that Easy Saver accounts deposits were strong,
"exceeding our expectations."

The central bank, for its part, has said that it would continue to work
on making the local financial system more inclusive.
In a speech to rural bankers in August, Mr. Tetangco said, "Financial
inclusion is dear to the BSP. We see it as the means to expand access to
financial services through multiple, innovative yet safe channels for
more Filipinos, including -- and especially -- the previously unbanked."

Cordillera cooperatives lend P1.5B, employ 1,400

Published : Thursday, October 20, 2011 00:00 Article Views : 183 Written
by : Larry Madarang, Correspondent

LA TRINIDAD, Benguet: Local cooperatives in have contributed P1.5
billion in loan releases as its volume of business in the Cordillera
region.
Cooperative Development Authority (CDA) revealed this during the
Philippine Information Agency's "Kapihan sa Benguet" over the weekend.

Of the more than a billion in loan releases, P137 million was farmed out
to Benguet province, the CDA said, and cited that there is a total of
P700 million in sales in the region with Benguet owning P334 million of
the P700 million.

The Cordillera region's cooperative sector employs a total of 1,485
individuals and contributes around P85 million in paid wages and
salaries, CDA cited.

Currently, there are 701 registered cooperatives with the CDA, 100 of
which are newly formed cooperatives.
The cooperatives in the region have a total of P2.7 billion in paid up
share capital of its members with a total savings of P995 million.

The CDA aims to increase its cooperative membership base from 7 million
members as of present to 20 million members in the next three years.

The CDA will be marking the Regional Cooperative Month on Oct. 26-27,
2011at the Benguet State University Gymnasium here.

Meanwhile, the CDA identified the Baguio-Benguet Community Credit
Cooperative (BBCCC), the Baguio General Hospital Multi Purpose
Cooperative (BGHMPC), the Benguet Traders Multi Puspose Cooperative
(BTMPC) and the Tanudan Saving Cooperative in Kalinga as the top
cooperatives in the different categories in the Cordillera region.

The BBCCC tops the large cooperative category with a total assed of P1.1
billion, it is followed by Tabuk MPC; Texins MPC, Philex Credit; Abra
Diocesan TE MPC; LAGSADECO; Lagawe MPDDC; Mothers and Family MPC; Besao
MPC; and the All Saints Credit.

With the medium cooperative category, BGH MPC with a total asset of P94
million is followed by the Sagada MPC; Tabuk Farmers MPC; BSU MPC;
Bavesco; Bad-ayan Bugias; LT Trading Post MPC; Tam-an MPC; Piwong MPC
and the BAMAPCOM Entrepreneurs.

For the small cooperative category, the Benguet Traders MPC is followed
by the Cordillera OCW; Mabuhay MPC; Aguinaldo Mktg.; BODA MPC; Trinidad
based Agawa; Ambigatton MPC; Timber and Lime; Cordillera Homeowners; and
the La Trinidad MPC.

While in the micro cooperative category, Tanudan Savings is followed by
the LBP Employees MPC; San Ramon MPC; SRT Alfonso Lista; Bagtangan
Farmers; Baguio's Finest; Holy Trinity Cathedral; Tawang MPC; Sayapot
MPC and the Abreco Employees.

A large scale cooperative has P100 million or more in assets, while the
medium category has P15 million to P100 million; a small cooperative has
P3 million to P15 million; and the micro cooperative P3 million and below.

Rural bankers group calls for proportionality in amending RB Act

Proportionality should be a primary consideration in amending the Rural
Bank Act of 1992 which both chambers of Congress are being urged to tackle.

Former Rural Bankers Association of the Philippines (RBAP) president
Tomas Gomez IV stressed this point when interviewed during the 58th
annual convention of the association on the bill proposing the
long-sought amendment to the law governing rural banks.

Provisions of the bill seek to allow foreigners to have a stake in local
rural banks and at the same time strengthening the regulatory oversight
of the Bangko Sentral ng Pilipinas (BSP) on these financial institutions
which are crucial in the development of far-flung communities.

The issue of proportionality as what Gomez had pointed out, has been a
collateral provision that rural bankers are fighting for along with
allowing foreign capital infusion under the amended law.

While rural banks have waited for too long for the amended law, it
should, however, be assured in being carefully crafted to consider the
unique situations among rural banks in the Philippines.

The RBAP is satisfied with the way the BSP thus far had taken great care
to assure proportionality in regulating banks in that its rules do not
apply similarly to all types of banks such as what was stated by BSP
deputy governor Nestor Espenilla's speech during the convention on the
matter of governance at the board level.

Espenilla indicated the BSP may relax rules on rural banks on required
committees in their board because of the fact there are not enough board
members to go around.

Despite the BSP's supportive stance, however, such flexibility for rural
banks should be enshrined in a law.

Among flexibilities that rural banks are seeking under the law are
reduced penalty charges relative to bigger commercial banks, a graduated
approach in capital buildup compared to the Basel II requirement for a
one time implementation for commercial banks, allowing foreign equity to
inject much needed capital in the rural banking sector to expand its
outreach to serve more customers and obtain additional capital to invest
in new technologies, expand infrastructure, improve management, and
improve lending capacity.

Foreign capital will also put rural banks on a level playing field with
its thrift and commercial bank counterparts that are able to take in
foreign partnerships.

The working relationship among rural banks and BSP the regulator is the
envy of other countries and the continuing dialogue that banks have with
the BSP assures an open line of communication between the regulator and
the regulated.

Such a cordial relationship with the regulating agency is becoming more
of a necessity as consolidation becomes more prevalent as a result of
economic dictates or the need for a certain scale to be more effective
that is expected to result to fewer but stronger rural banks.

As of now the rural banking sector is healthy, thanks to the cooperative
work between the RBAP and the BSP. Rural banks, at the moment, has a 19
percent adequacy ratio and continues to be profitable.

From 2000 to 2009 based on figures of the BSP, return on equity of the
rural banking sector is higher than commercial thrifts banks
consistently every year.

The generally robust health of rural banks, in turn, allows them to
offer more services and products.

A healthy and competitive rural banking sector means more services and
sources for banks to reach out to the unbanked sector of the society.

Consolidation would be a natural effect, meanwhile, of rural banks'
pursuit for improved and wider services.

In the meantime, while the rural banking sector exist in the volatile
state of seeking its ideal form, amending the law for it to conform with
current situations will act as a catalyst to speed up its development.

The target right now is for rural banks to be present in at least 30
percent of all municipalities in the country.

Already, rural banks through the use of modern technology as mobile
phones have succeeded in extending banking services to more Filipinos
beyond the physical reach of most banks.

The challenge is, however, for mobile phone banking accounts to
translate to the more formal bank accounts or savings accounts that
would raise tremendously the level of savings in the population which in
the country is currently the lowest in the Asian region.

All of these changes can be spurred with the right amendments to the
rural banking law.

ADB says Philippines can grow by 7-8%

Country seen with resources to post faster growth

By: Michelle V. Remo
Philippine Daily Inquirer
9:55 pm | Wednesday, October 19th, 2011

The Asian Development Bank said the Philippines should aspire to post an
economic growth of 7 to 8 percent a year, stressing that the country has
the resources needed to achieve the goal.

According to an ADB economist, the country simply has to resolve
administrative and regulatory factors that hinder the entry of more
businesses so that more investments will come in, thus accelerating growth.

"The country should not be satisfied with a 4- to 5-percent growth;
aspiring for a 7- to 8-percent growth is good because that range is what
is needed to reduce poverty," ADB assistant chief economist Joseph
Ernest Zveglich Jr. said Wednesday in an interview following the CEO
Forum organized by Punongbayan & Araullo.

The Aquino administration originally aimed for the economy to grow by 7
to 8 percent every year during the duration of its term, but recently
cut the target on grounds it may be too ambitious at this time.

Earlier this year, the economic team set a 2011 growth target of 5 to 6
percent. This month, the team reduced the range to 4.5 to 5.5 percent,
taking into account the adverse effects of a weak global economy.

For next year, the team set the growth target at 5 to 6 percent, giving
up on the 7- to 8-percent goal for the meantime due to challenges
confronting the economy.

Zveglich said, however, that there is reason to support a higher growth
target since required resources are available, such as a skilled and
educated workforce, as well as natural resources.
Achieving the goal would require the determined effort on the part of
the administration to improve the business climate.
The ADB economist said that the Philippines could, for instance,
streamline the procedures in setting up businesses to encourage more
entrepreneurs to set up shop.
Zveglich also said regulations should be consistent to spur investment
growth, which will lead to economic growth.
In the first half, the Philippines grew by 4 percent, slowing down from
the over 8 percent registered in the same period last year.
Officials said that while the average growth of 4 to 5 percent over the
past decade was decent, that pace of growth does not allow the benefits
of economic expansion to trickle down to the masses.
Economists say that this is why poverty incidence in the country is
still high at 26 percent even if the Philippines has grown consistently
over the past decade and has avoided recessions that other countries
experienced.

Wednesday, October 19, 2011

PNB Life sold 500-million insurance to OFW families

WEDNESDAY, 19 OCTOBER 2011 19:27

ASIAN Summit, the latest insurance product offering of the Philippine
National Bank, generated premium sales of some P500 million, mostly from
families who are beneficiaries to remittances of overseas Filipino
workers (OFWs).
 PNB Life Insurance Inc. reported on Wednesday that its Asian Summit
insurance product, a single-pay, peso-denominated variable life offering
that matures in five years, proved a hit among families who wanted risk
cover for some of their family members.

"Over 1,000 Filipino families chose PNB Life's banner unit-linked
product over others in the market, entrusting over half a billion pesos
in precious savings and hard-earned OFW remittances to PNB Life. This is
a vote of confidence not just for the life-insurance arm of the Lucio
Tan Group, but also to the Philippine economy which is part of a basket
of five Asian countries linked to the product," PNB Life said in a
statement sent by e-mail.

The Asian Summit is a unit-linked insurance product or one in which the
insured has access to a professionally managed fund and the potential
for additional earnings this represents on top of the risk cover
presented by the insurance contract.

More and more life insurers in the Philippines have offered unit-linked
products for their clients.

According to PNB Life, even the more conservative among OFW families
were attracted to the Asian Summit's features, including up to 150
percent of the initial investment payable upon the untimely death of the
insured before maturity.

If the insured survives then no less than 105 percent of the initial
investment can be expected at the end of the lock-in period.

"Investors of all ages and risk appetites found something to like with
Asian Summit and boosted PNB Life to new heights," PNB Life said.

"PNB Life has been exploring the launching of an innovative unit-linked
product and found an auspicious time to launch it this year. We are
overwhelmed by the solid support and belief in our company and thank our
sales force, bank partners' Allied Bank Corp. and Philippine National
Bank, and our employees for their exemplary teamwork leading to the
historic success of Asian Summit," PNB Life President and Vice Chairman
Esther C. Tan said.

DTI promotes Nueva Ecija mushroom meat

DTI promotes Ecija mushroom meat

By MARK ANTHONY N. MANUEL

October 18, 2011, 5:04pm

CABANATUAN, Nueva Ecija, Philippines — The Department of Trade and
Industry (DTI) here is promoting products of cooperatives that sell
fresh and processed mushrooms, such as mushroom "sisig" and "tempura."

DTI Nueva Ecija Provincial Director Brigida Pili said these mushroom
growers of this province are recipients of their One-Town-One Product
(OTOP) program.

Pili said the mushroom industry in the province has huge potential as a
great alternative to meat.

Seeing the viability of the cooperative's mushroom production, other
institutions including the municipality of Lupao, Nueva Ecija, the
Philippine Army, the Department of Labor and Employment (DoLE), and the
Land Bank gave mushroom cooperatives grants amounting to more than P1
million combined.

Likha ng Central Luzon (LCL) Trade Fair next week at the SM Mega Mall,
Mandaluyong City will showcase products of award-winning cooperative
Parista Barangay Defense System Multi-purpose Cooperative (PBDS-MPC) of
Lupao, Nueva Ecija.

The cooperative will sell fresh and processed mushrooms at the annual
regional trade fair organized by the DTI Region 3 (DTI-R3).

Rural Bankers Research and Development Foundation, Government Agencies Support Rural Banks to Offer Microinsurance Services

MICROCAPITAL BRIEF:
In Philippines, Rural Bankers Research and Development Foundation,
Government Agencies Support Banks to Offer Microinsurance Services

by MicroCapital on Wednesday, October 19, 2011 at 12:22am

The Rural Bankers Research and Development Foundation Incorporated
(RBRDFI), the research and development arm of the nonprofit Rural
Bankers Association of the Philippines (RBAP), has been offering
training on microinsurance to local rural banks, of which seven have so
far been licensed to offer microinsurance services by the Bangko Sentral
ng Pilipinas (BSP), the central bank of the Philippines, and the
Insurance Commission (IC), which regulates the country's insurance
industry. Another 40 rural banks reportedly have applications pending.
RBRDFI has trained 270 bank staff from 130 rural banks under its "Basic
Microinsurance" course since the start of 2011 [1]. The course covers
the fundamentals of microinsurance selling, marketing and servicing.

The Philippine government, through a tie-up between two agencies, the
Department of Finance (DOF) and the Department of Social Welfare and
Development (DSWD), is also working to expand microinsurance coverage by
targeting beneficiaries of the cash transfer program "Pantawid Pamilyang
Pilipino," which reached 2.3 million households this year and is
forecast to reach a total of 3 million beneficiaries by 2012 [2].
Beneficiaries will be linked with microinsurance mutual benefit
associations, which provide life, credit life and health insurance
coverage [3].

Tuesday, October 18, 2011

Montinola says pioneer innovations spur BPI’s growth

Montinola says pioneer innovations spur BPI's growth

In any business, going beyond means more than just coming up with
innovations; more importantly, it's all about thinking ahead by
providing efficient, convenient, and accessible measures that truly
makes things easy for customers.

This is the vision that the Bank of the Philippine Islands (BPI) carries
as it kicks off the celebrations for its 160th anniversary last August
1. "Throughout 160 years, BPI has pioneered banking innovations that
helped spur the growth and development of the industry through
streamlining of banking processes, computerizing and automating
operations, and improving overall security of transactions," says BPI
president Aurelio R. Montinola, III. "BPI envisions to democratize
financial responsibility by empowering Filipinos to live more
progressive lives and realize their dreams. This is in keeping with our
thrust to make banking more accessible, more convenient, and more
affordable to more Filipinos."

During the anniversary kickoff, BPI reported that a double-digit rise in
net interest earnings has pushed its first semester net profit to grow
by 12 percent to P6.2 billion. Net profits for the second quarter alone
grew by 18 percent, reaching P3.3 billion in total from P2.8 billion
last year. Revenues, on the other hand, saw a 15 percent rise with
increases generated by both net interest and non-interest income.

BPI has pioneered a number of firsts which have changed the landscape of
the industry over the years. "BPI was not only the first established
bank in the Philippines but, more significantly, was also the first
established bank in Southeast Asia," reveals Montinola.

In 1852, BPI printed out the first Philippine peso, thus taking
Philippine trade beyond the Spanish currency. And then in 1901, BPI
financed the country's first railroad system that gave people easier
access to locales beyond their own. Twelve years after, in 1912, BPI
brought banking beyond Luzon and Visayas when BPI opened its first
regional branch in Zamboanga. And in 1981, BPI brought electronic
banking to a new level by introducing the country's first ATM system—the
BPI Express Teller. More recently, in 2003, BPI became the first bank in
the country to introduce mobile banking. And in 2008, BPI pioneered the
concept of real-time, online banking when they allowed customers to bank
in any BPI branch beyond their home branch.

Today, BPI sets its sight to improving every Filipino's banking
experience by going beyond the ordinary with banking innovations that
help address the need of Filipino businesses. "BPI's banking innovations
celebrate the marriage of technology and efficiency by leading Filipinos
to financial empowerment," says Montinola.

BPI has rolled out a full set of banking services that adheres to its
vision of making banking easier and convenient for Filipinos today.
"Last April, we have launched the BPI Investments Online—the country's
first-full service investment funds platform," Montinola reveals. This
program simply allows clients to initiate new investment accounts,
subscribe to and monitor their investment funds and redeem these
investments through the internet, wherever they are and whenever they want.

BPI has also been rolling out a new digital customer transaction assist
platform in its branches called the BPI Express Assist (BEA). Customers
can now forget about the hassles of filling out deposit or bills payment
slips and cut down their transaction and waiting time as BEA makes
everything simpler and faster with its touch-screen processing and
automated queuing. More significantly, this particular technology, which
was conceived in partnership with Wincor Nixdorf, has been awarded the
Best Automation and Networking Award in the 5th Asian Banker Technology
Implementation Awards Programme held in Hong Kong, also last April.

Another facility that will be launched very soon, Montinola notes, will
combine the power of BPI Express Mobile and the near field communication
(NFC) technology, allowing clients to have a mobile wallet in their
mobile phone. "This will allow clients to make purchases without
carrying cash. Simply wave your mobile phone on a POS terminal with a
reader, and the payment will already be made in an instant," says the
BPI top boss.

As Internet technology progresses, BPI also developed parallel web-based
banking solutions for businesses. Eleven years ago, BPI unveiled the
ExpressLink (or ELink), BPI's Internet-based solutions which allow
businesses to monitor account balances and banking transactions, collect
payments, and pay the company's obligations—all through the Internet. As
the most multi-awarded cash management solution in the country, ELink
has changed the way FIlipinos do business by allowing decision-makers to
manage their finances without having to be physically present at the
workplace. ELink has also been made available even for smaller
businesses and start-up companies to help them enjoy the same benefits
that big companies have access to. "Now, ExpressLink has gone beyond the
Internet platform, and extended to the mobile technology of today. This
we call ExpressLink mobile or the ELink Mobile, which allows businessmen
to have control over their company's finances anytime, anywhere via
their mobile devices."

"By diversifying financial channels through these programs, BPI
harnesses more accessible technologies today to keep every aspect of our
clients' businesses on their fingertips, literally," shares Montinola.
"Truly, BPI stays true to its commitment of being making life easy for
the Filipinos."