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Selling off ‘assets’
This week, the Department of Finance announced that it has started selling non-performing assets to generate cash and strengthen its balance sheet. The government has already sold assets worth P800 million in the first six months of the Marcos administration, and it plans to sell assets worth P1.9 billion in 2023, according to Finance Secretary Benjamin Diokno. The government’s asset sale program has several benefits and drawbacks. On the one hand, selling off non-performing assets can help the government generate much-needed funds. Priority projects, including infrastructure development, education, and healthcare, can be funded with the sale proceeds. Selling off non-performing assets can also assist the government in strengthening its balance sheet and lowering its debt load. The asset sale scheme, however, could also have significant disadvantages. For example, if the government sells off an excessive number of assets, it may be unable to continue offering the people basic services. Furthermore, the government may incur losses if it cannot sell its assets at a fair price. The government’s asset sale plan is comparable to initiatives taken by other nations. For instance, the US government has been selling off non-performing assets lately to generate cash and pay down debt. Ditto with the United Kingdom. The US Government Accountability Office, or GAO, reports that in 2022, the US government sold off assets worth $14.4 billion. These included possessions like land, boats, and cars. These sales generated money for several government initiatives, including funding the military, schools, and healthcare. In 2022, the UK government sold off a sizable number of assets. The Department for Business, Energy and Industrial Strategy — in charge of running UK’s asset sales program — sold assets worth £1.5 billion. This comprised property, stock in corporations, and government-owned structures. The National Health Service, education, and infrastructure were among the government projects that were supported using the money raised from these sales. The governments of the Philippines, the US, and UK are not the only ones that have sold off assets recently. Also last year, the Australian government sold assets worth $10.6 billion, while the Canadian government sold off $5.5 billion worth. The asset sale program of the Philippine government is akin to the initiatives to sell public property under the previous administrations of the late Noynoy Aquino and Marcos’ immediate predecessor, Rodrigo Duterte. Probably eclipsing all asset liquidation activities of any and all presidencies would be the one undertaken under the Ramos administration from 1992 to 1998. The Ramos government went on a selling spree of power plants, land, and other government properties, generating, according to one estimate, P70 billion. Overall, there are advantages and disadvantages to the Philippine government’s asset-selling policy. Before moving further, the government should carefully weigh the program’s possible advantages and disadvantages. The following points should be taken into consideration as the Marcos administration begins to sell off non-performing assets: Obtain a reasonable price for the assets, prevent the sale of too many assets that would limit the government’s ability to offer the public necessary services, and make sure that the money raised from the sales will go toward important initiatives like infrastructure development, education, and healthcare. Finally, the public should receive regular updates from the government regarding the asset sale process for there to be complete transparency. The sale of public property is a contentious topic. Some claim it is essential for governments to increase revenue and lower their debt load. Others contend that it is a means through which governments can privatize crucial services and lessen their responsibilities to the general populace. The post Selling off ‘assets’ appeared first on Daily Tribune......»»
High foreclosed properties demand seen
The Home Development Mutual Fund or Pag-IBIG Fund reported that it has seen higher demand for its foreclosed properties in Metro Manila from January to April this year as their total loan value rose by 9 percent. It said that loans for the foreclosed properties in this area amounted to P2.89 billion during the period, higher than the P2.64 billion in the same months last year. The latest figure represented 66 percent of the P4.37-billion sale of all previously foreclosed properties nationwide. Pag-IBIG said that units sold in Metro Manila increased by 3 percent to 3,574 units from 3,457 units and nationwide, there were 5,425 units sold. Pag-IBIG Fund deputy chief executive officer Benjamin Felix Jr. said that the foreclosed properties or acquired assets of Pag-IBIG allows borrowers to own a home at a cheaper cost. He added that some borrowers opted for these housing units to “partly reduce their losses from inflation and secure a good location for their homes.” Felix stressed that the loan values of foreclosed properties increased as more Filipinos prefer bigger housing units. Data from Pag-IBIG Fund show it has over 7,000 foreclosed properties that undergo either public auctions or negotiated sales for individual and bulk buyers. The agency’s foreclosed properties are sold lower than the real estate industry’s market values. Pag-IBIG offers up to 30-percent discount for cash payments from individual buyers and 45-percent discount for bulk buyers. The agency’s on-site process at its offices also ensures home-seekers are buying legally clean properties. The post High foreclosed properties demand seen appeared first on Daily Tribune......»»
Fried in own lard
While the National Transmission Corp. or TransCo concessionaire National Grid Corp. of the Philippines has been awash with cash as reflected in its billions of pesos of early dividends, it has not paid the government P3 billion plus interest on transmission fees before 2009 when the private firm took over operations of the power grid. The amount represents collections from power plants to which TransCo is entitled but remains unremitted. Under a privatization program, former President Gloria Macapagal-Arroyo approved a plan to privatize TransCo through a 25-year Operation and Management Concession Agreement. The bidding for the license to run the Philippine power grid was won by the NGCP in 2007, while Congress approved the bicameral resolution granting its franchise in 2008, and PGMA signed RA8511 into law, granting NGCP its franchise. On 15 January 2009, TransCo turned over the management of the country’s power grid to NGCP. TransCo, owner of the electricity network, and energy assets holding firm Power Sector and Liabilities Management Corp. have been demanding the payment of the amount. An energy official said the government can use the money to reduce power rates by deducting this from the monthly bills under the item universal charges. Universal charges include the so-called stranded costs or payables to Independent Power Producers that PSALM assumed from state firm National Power Corp. Instead, the energy official suspects NGCP used the withheld payments for its benefit to consistently pay fat dividends to its shareholders. In the recent Senate inquiry on the power industry, NGCP said of its P20.3 billion net income in 2019, P15 billion, or around 74 percent, went to dividends. In 2017, around 90 percent of its P20.6 billion net income went to dividends. For 2015, the NGCP distributed around 93 percent of its P22.5 billion profit as payouts to shareholders. The company particularly made its investors happy in 2014, when it said dividends exceeded its net income or P24 billion handed to stockholders against P22 billion in profit. Counting the potential interest, an energy source said the receivables from NGCP have now ballooned to more than P6 billion. NGCP’s rampant violation of the provisions of the concession agreement had resulted in a serious financial drain on the government. The provisions of the 2009 deal, which included the settling of all arrears such as the TransCo collectibles, also provided separate audited accounts for each related business and the need for NGCP to hold an initial public offering that it skirted through the back door listing of a holding company. TransCo’s financial claim from NGCP was upheld by an opinion on 18 April 2012 by the Office of the Government Corporate Counsel. “TransCo has already acquired immutable vested rights over the contested revenues,” the OGCC decision indicated. “Public policy considerations and the public nature of the receivables impose upon TransCo the obligation to recover the disputed amount for its benefit,” it added. NGCP holds a renewable 25-year concession contract and a 50-year franchise to operate the power transmission network in the country. Since the agreement was signed in 2009, the contract will run until 2034 and from then, the government has the option to renew it for another 25 years. An audit that has long been blocked by NGCP should happen and from there, the government should muster the will to take the necessary steps if abuse is found in the performance of the provisions of the concession agreement. The post Fried in own lard appeared first on Daily Tribune......»»
Realty trust posts P1-B Q1 revenues
MREIT Inc., the real estate investment trust of Megaworld Corp., saw double-digit growth in its distributable income during the first quarter following successful assets boost. In a disclosure to the Philippine Stock Exchange on Friday, the company said January to March distributable income reached P713 million, 12 percent higher than last year’s gains. Similarly, MREIT said its revenues during the first three months also grew by 15 percent to P1 billion from the P901 million posted in the same period a year ago. Financial growth The company, in its report, pointed out that the financial growth was driven by the “successful acquisition and consolidation of the P5.3 billion worth of assets,” which began contributing to MREIT’s income at the start of the year. “We have achieved another milestone for MREIT as we finally closed our promised acquisition,” Kevin Tan, president and chief executive officer of MREIT Inc., said. “As we move forward, we remain focused on our core strategies of acquiring high-quality assets and delivering sustainable income to our investors, as are now working for the next stage of growth for MREIT,” he added. Declared dividends Following the results of the first quarter of 2023, MREIT declared dividends of P0.2476 per share to its shareholders based on its distributable income. The cash dividends will be payable on 19 June to shareholders on record as of 29 May. Year-on-year, this brings MREIT’s dividend yield to 6.8 percent as of the closing share price of P14.66 per share on 11 May. As we move forward, we remain focused on our core strategies of acquiring high-quality assets and delivering sustainable income to our investors, as are now working for the next stage of growth for MREIT. MREIT’s new assets increased its gross leasable area by 16 percent to 324,700 square meters and include four prime, Grade A, and PEZA-accredited office properties in McKinley West and Iloilo Business Park. As of end-March, MREIT’s average occupancy rate is at 95 percent, which was significantly higher than the broader office industry’s average occupancy rate of around 80 to 81 percent. The post Realty trust posts P1-B Q1 revenues appeared first on Daily Tribune......»»
S& P warns strong momentum waning
Persistent inflation, higher funding costs and slower earnings growth are wearing out the rebound momentum of the economy, according to the Standard and Poor’s report “Philippines Corporate Primer: Covid Hits Aren’t Slowing Growth Aspirations.” “Philippines Inc. faces tougher sailing in 2023,” the report said. “The outlook for large Philippine companies this year can be summarized in a few words: persisting growth aspirations, more leverage, slowing profit growth but generally sound liquidity,” S&P Global Ratings credit analyst Xavier Jean added. S&P said the primer is based on an analysis of five years of financial data on 40 of the largest local corporate and infrastructure entities by market capitalization, assets or debt. “Our survey of these listed companies comes in response to numerous queries from investors on the Philippines after its economy recovered from a sharp, Covid- induced drop,” S&P indicated. S&P said key trends identified are rising leverage and a widening wedge in credit quality among the country’s largest companies. Growth strategies remained ambitious even in the depths of Covid shutdowns--and were often funded with cheap debt. At the same time, distributions to shareholders stayed elevated even as earnings dropped during the pandemic. “Growth and more growth remain the common motto across Philippine Inc., just like it has been over the past five years,” Jean said. Capex heading higher Last year, aggregate capital spending at the 40 companies was up 65 percent compared with 2020 (when it dropped by a third). “We estimate the top-40 have dedicated about half of their earnings before income tax, depreciation and amortization or EBITDA to investments over the past five years. That’s double the level of their Vietnamese counterparts, as one comparison,” according to Jean. Based on S&P’s estimates, the average debt tenor in the top-40 is between three and four years, about double the length of their Vietnamese counterparts. Liquidity and cash also remain sound on balance. A majority (60 percent) of the companies reviewed still had sufficient cash on hand at the end of 2022 to repay debt maturing in 2023. “However, that ratio is falling--years of accumulated cash deficits has broadly eroded cash balances,” the report indicated. It said that domestic banks provide most corporate credit, except for the largest diversified groups, which have more regional or international funding sources. “We do not view this concentration as a significant negative, however. Domestic banks are generally well-capitalized, with adequate provisions for nonperforming loans. They have also been reliable capital providers to the large corporate sector, even during Covid,” the report added. The post S&P warns strong momentum waning appeared first on Daily Tribune......»»
Sandigan junks P130 million civil forfeiture case vs Corona
The anti-graft court Sandiganbayan has dismissed the P130.59-million civil forfeiture case against the late chief justice Renato Corona, which stemmed from his failure to declare several cash assets and properties in his statements of assets, liabilities and net worth or SALNs......»»
DoubleDragon, Jollibee to create Philippines first and largest industrial REIT
Jollibee Foods Corp. will infuse cash and property assets into one of DoubleDragon Properties Corp.'s units to create the first and largest industrial real estate investment trust (REIT) company in the country......»»
AREIT buys P5.1-B office mall
AREIT Inc., the real estate investment trust sponsored by Ayala Land Inc., has acquired a mall and office development in Pasig City from the real estate giant for P5.1 billion. In a disclosure to the Philippine Stock Exchange, AREIT said it is buying The 30th, a 76,000 square meter commercial development located along Meralco Avenue in Pasig City. “The asset will increase AREIT’s portfolio to 246,000 square meters of GLA from 170,000 square meters and will contribute to its net income and dividends in 2021,” AREIT said. The 30th is a commercial development that was planned and developed by Ayala Land and completed in 2017. The office building is fully occupied predominantly by BPO companies. The 30th includes an amenity retail podium which will be operated and leased by Ayala Land from AREIT. Simultaneous to the acquisition of the building by AREIT, ALI will assign the long-term land lease to AREIT. AREIT wil lease office spaces to tenants, and the retail podium to Ayala Land under a fixed lease as operator of the retail spaces. The acquisition will be funded through debt. It will be a cash purchase with the installment schedule to be agreed by the parties. Currently, AREIT has no debt thereby allowing it to acquire assets that are yeld accretive through leverage. “This demonstrates AREIT’s ability to grow its portfolio and add value to its shareholders while its Sponsor, Ayala Land, Inc. can recycle the capital for its real estate projects in the Philippines,” AREIT said......»»
Medium-sized banks seek lower stock of liquid assets
Mid-sized banks are seeking lower stock of liquid assets, including cash on hand required to be kept with the Bangko Sentral ng Pilipinas, to free up more funds for lending amid the COVID-19 pandemic, according to the Chamber of Thrift Banks......»»
Cash-rich banks swarm safe assets
Cash-rich banks continued to swarm the liquidity absorption facilities of the Bangko Sentral ng Pilipinas amid ample excess funds in the financial system......»»
ED attaches asset worth Rs 70 lakh in bank fraud implicating Hyderabad-based Jasleen Enterprises
New Delhi [India], March 28 (ANI): The Directorate of Enforcement (ED) has attached an immovable property valued at Rs 70 lakh in a bank fraud case involving Jasleen Enterprises headquartered in Hyderabad. The Hyderabad division of the ED attached the fixed asset in accordance with the stipulations outlined in the Prevention of Money Laundering Act (PMLA) of 2002. ED initiated investigation on the basis of First Informati.....»»
Skills trainees receive P3,000 cash incentive
Skills trainees receive P3,000 cash incentive.....»»
Globe closed on an additional P1.16-B in tower sales
Globe Telecom, the Zobel Family’s telecommunications company, disclosed that it closed on the sale of another 91 cell towers to Frontier Towers to raise approximately P1.16 billion in cash......»»
Cebu City buy-bust: Over P12M ‘shabu’ seized from 2 HVIs
CEBU CITY, Philippines – Police confiscated over P12 million worth of suspected shabu from the possession of two men during a bust-bust operation in Brgy. Bulacao, Cebu City on Tuesday evening, March 26. The buy-bust operation was conducted at around 10 p.m. in Lower Sario in Brgy. Bulacao. One of the suspects was identified as.....»»
Mandaue drug bust: P476,000 ‘shabu’ seized from HVI
CEBU CITY, Philippines — Authorities seized suspected shabu worth at least P476,000 from a 45-year-old man described as a high-value individual during an anti-illegal drugs operation in Mandaue City early on Wednesday morning, March 27, 2024. The operation took place along Realty Road in the North Reclamation Area in Barangay Subangdaku, Mandaue City, Cebu. The.....»»
Pia binasag nga ba si Heart sa ‘worth ng kababaihan’ campaign?
MAY “silent war” nga ba sina 2015 Miss Universe Pia Wurtzbach at Kapuso international fashion icon na si Heart Evangelista? Yan ang nakakaintrigang tanong ng mga netizens nang mapansin nilang tila sinagot ni Pia ang lumang Instagram post ni Heart noong January, 2024. Usap-usapan ngayon ng mga Marites ang matapang na statement ni Pia para.....»»
Man-made disasters cost Philippines 164.87 mln USD in 2023
MANILA, March 26 (Xinhua) -- Man-made disasters caused the total damage in the Philippines worth 9.29 billion pesos (164.87 million U.S. dollars) in 2023, the Philippine Statistics Authority (PSA) said Tuesday. The agency said that out of the total annual damage, 4.93 billion pesos (87.5 million dollars), or 53.1 percent, was due to the oil spill. "The reported oil spill in various regions resulted in dam.....»»
Is your salary enough?
The most awaited day for employees is the 15th of the month. On this day, the ATMs become the popularly sought-after machine for salaried employees and workers who must eventually remit their hard-earned cash to their homes......»»
Philippine food firms’ sales hit $133 million in Dubai fair
Philippine food companies generated $133 million worth of export sales from a food trade show held in Dubai last month, according to the Center for International Trade Expositions and Missions......»»
P4-M smuggled cigs seized, 2 arrested
THE Bureau of Customs-Davao Region (BOC-Davao) confiscated smuggled cigarettes worth P4 million in Barangay Lacson, Calinan District, Davao City on March 22, 2024......»»