business The Manila Times MONDAY BY KATRINA MENNEN A. VALDEZ REPORTER


TATE-RUN Government Service Insurance System (GSIS) plans to double its exposure to the Philippine


stock market. Robert Vergara, the pension


fund’s president and general man- ager, told reporters that GSIS would likely focus on equities as yields in the fixed-income market are insufficient to meet the its ac- tuarial requirements. “A large proportion [of GSIS’


Price war, new rival to upset telcos


FITCH Ratings Inc. warned of more intense competition in the Philip- pine telecom industry because of price wars and the entry of a new player that could temper the growth of the country’s two largest mobile phone providers.


In a statement, the London-based credit rating firm said competition is likely to intensify with aggressive “unlimited plans” and promotions by Globe Telecom and Digitel Mo- bile Philippines Inc. “So far, wireless competition has marginally affected PLDT’s RMS [revenue market share], which it has maintained between 57 percent to 58 percent during 2008 to 2010,” Fitch said.


The rating firm said there is a risk that the industry could be- come more competitive with the entry of a new player - San Miguel Corp. (SMC) in partnership with Qatar Telecom (Qtel) - over the medium term. SMC and QTel announced their memorandum of understanding in 2008, and have so far focused on wireless broadband through their stakes in Liberty Telecoms Hold- ings Inc.


Fitch said the increasing adoption of fixed-line and wireless broadband services tends to canni- balize wireless data (mainly short messaging system), as well as na- tional long distance (NLD) and in- ternational long distance (ILD) serv- ice revenues, to some extent. Compared with Asia-Pacific


peers, the impact is much higher for the Philippine telcos since SMS rev- enues represent almost 50 percent of total wireless revenues, the rat- ing firm said. Accordingly, the uptake of lower- margin wireless and fixed-line broadband services is likely to place downward pressure on the Philip- pine telcos’ existing SMS, NLD and ILD service revenues and consoli- dated margins, Fitch said. Fitch affirmed PLDT’s long-term local currency issuer default rating (IDR) at “BBB,” long-term foreign currency IDR and the rating of its outstanding global bonds and sen- ior notes at “BB+,” and national long-term rating at “AAA(phl).” The outlook is stable. Fitch, however, noted that PLDT’s ratings are constrained by its expec- tations that the cellular portion of the wireless segment now offers lim- ited growth opportunities with headline penetration of more than 90 percent.


Fitch said Globe’s wireless seg- ment is facing declining revenues and operating margins because of intensified competition, multi-sub- scriber identification module (SIM) usage, and increasing adoption of “unlimited plans” by subscribers. Although Globe’s fixed-line and broadband segment is performing well and growing, this growth is unable to completely offset the de- clines in the wireless segment. Fitch said Globe’s revenues and margins were also negatively affected by the rising peso during the nine months to end September 2010. The agency also has some con- cerns regarding Globe’s increasing shareholder focus — it distributes dividends in the range of 75 percent to 90 percent of its net income. Fitch also affirmed Globe’s long- term foreign currency IDR, long- term local currency IDR and the rat- ing of its outstanding global bonds and senior notes at ‘BB+’, as well as its national long-term rating at “AAA(phl).” The outlook is stable. The rating firm added that the sta- ble outlook reflects the expectation that Globe will maintain its en- trenched position in the Philippine telecommunications sector, notwith- standing increased competition. DARWIN G. AMOJELAR


portfolio is parked in] fixed income instruments and we are looking at putting more into equities given the low yields in government securi- ties,” he told reporters on the side- lines of the Department of Finance’s Christmas party. “We want to balance out our ex-


isting portfolio to get higher returns on its investments,” he said. GSIS is among the government fi- nancial institutions that the Aquino administration wants to tap for funding the state’s public-private partnership (PPP) initiative. Vergara said about 85 percent of the pension fund’s liquid assets are parked in fixed-income instruments, mostly long-term government secu- rities, and only about 15 to 20 per- cent are in equities.


Another 40 percent of GSIS’


investible funds are in loans to its 1.4 million members, while the re-


B 3


D e cember 13, 2010


GSIS plans to hike stock market exposure S


mainder is in various instruments, including about 6 percent in a glo- bal investment program, which the top executive said will be reviewed next year.


“Depending on the market, we might increase equity holdings to 35 to 40 percent and maintain the bal- ance in fixed income. This [move] won’t be drastic, but would be im- plemented over one-and-a-half years to pave way for [a] smooth transition,” he said. The executive said the fund would once more take on a more aggres- sive role in the stock market after


divesting its shares in Manila Elec- tric Co. and Philex Mining Corp. over the last 18 months.


He said GSIS needs returns on its


investments in excess of nine per- cent to keep up to its actuarial re- quirements. “We currently have a return of 10


to 11 percent on our investible funds but prospectively, this may not be sustained if we maintain the current portfolio mix since we started the year with bond yields at 9 to 10 per- cent and now the yield for the 25- year bonds have gone down to eight percent,” he said.


THE Philippine Stock Exchange (PSE) is evaluating all legal options to resolve conflict-of-interest issues surrounding its president. Hans Sicat, PSE chairman, said the bourse’s board of directors might bring the case to court should the Securities and Ex- change Commission (SEC) rule against the appointment of Val Antonio Suarez as president and chief executive officer (CEO). “I guess the best thing to say is we’re


evaluating all legal options. Whether that’s the smartest thing to do is an- other issue,” Sicat told reporters. Suarez was recently charged by the corporate regulator with a basic fine of P1 million, plus daily fines of P1,000 on account of his ap- pointment in the bourse despite his close association with a broker.


Suarez’ wife Milagros Cecilia Dollendo Suarez was vice president and head of sales and marketing of JP Morgan Securities Philippines Inc. She was promoted to president, managing director and acting PSE nominee of the firm on July 1. Another option for the bourse is to ask exemptive relief from the SEC, Sicat said. Last year, the regulator approved the bourse’s petition to exempt from the Securities and Regulation Code (SRC) the appointment of William Ang, president of brokerage house Astra Securities, and Alejandro Yu, president of RS Lim and Co. Inc., as officials of the bourse. The regulator, however, warned


that was the last time that such a petition would be granted. The SRC provides that “the presi-


dent and other management of the Exchange [will] consist only of per- sons who are not members and are not associated in any capacity, di- rectly or indirectly, with any broker or dealer or a member or listed com- pany of the Exchange.”


But the PSE insists the prohibi- tion under Section 33.2 (h) of the SRC “extends to one’s own profes- sional association with a broker, and not to family relationships.” The bourse is also seeking further clarification from the corporate regulator as to how Suarez violated the law and why it had fined the bourse only recently when the PSE had made a full disclosure on his appointment in the past.


Suarez, the incumbent chief op- erating officer (COO) at that time, was appointed president of the


bourse on July 26. During the search period, the bourse secured two separate legal opinions from law firms Suarez Sycip Salazar Hernandez & Gatmaitan and Angara Abello Concepcion Regala & Cruz to support Suarez’ ap- pointment. Last August, the SEC had charged the PSE for the same violation. “You can ask the [SEC] why when


he was COO, there was no adverse reaction. When he became CEO there was an adverse reaction,” said Sicat. “You want the SEC to also be ap- plying the rules consistently and explaining it in a transparent way,” he added.


When asked if Suarez had indi- cated he would resign, Sicat said: “He’s not going to drag the Ex- change. He’s a great professional.”


With share prices currently trad- ing at 14 times earnings, there is still a lot of upside potential in the eq- uities market in contrast to the nega- tive interest rates at the fixed-income market, the GSIS chief said. “We are looking at broad center


weightings particularly in property, power and utilities. We would build weightings on those sectors but at the same time not skew our portfolio too much. Just mild overweighting or underweighting. Just tweak it a little bit. We are looking at any pullback in the market as a chance to re-deploy,” Vergara said.


Local bourse may ask court to bar SEC from penalizing PSE officer


The PSE is in the process of spin- ning off its broker regulation func- tion into a separate and independ- ent entity. Its final rules are await- ing SEC approval. “We’re doing that independent of


Val’s [case]. That started before Val came in… Arguably that can only help his case,” Sicat said. The bourse also confirmed a news report that Suarez has a trading right in the PSE, but insisted it was not an operating company. “When we took a look at that pre-


viously, it wasn’t an operating com- pany,” said Sicat. “But does owning a trading right


mean you’re allowed to trade? No. Even if you own a seat and a trad- ing right, the board will have to ap- prove it to operate it,” he added. KRISTA ANGELA M. MONTEALEGRE


BOI offers no new fiscal incentives for motorcycle assemblers


THE Board of Investments (BOI) would release the guidelines on perks for motorcycle manufactur- ers under the new vehicle development program, even as it has no new incentives to offer. Despite the lack of additional


perks for manufacturing, the motorcycle market in the country continues to grow—with sales this year expected to reach a


record high. Trade Undersecretary and BOI Managing Head Cristino Panlilio told reporters last week that the draft implementing rules and regulations (IRR) on motorcycle assembly of the Comprehensive Motor Vehicle Development Program (CMVDP) is just awaiting Trade Secretary Gregory Domingo’s approval, after which


the BOI would schedule the public consultation. Panlilio said the IRR covering


motorcycles offers “just the same” incentives, such as income tax holiday for new assemblers as well as duty-free importation of parts and components under the annual Investment Priorities Plan. Data from the Motorcycle


Eastern sets capex for 2011


EASTERN Petroleum Corp. will double its spending program next year in line with its plan to expand its retail network. Fernando Martinez, Eastern Petroleum chairman, said the company allocated P400 million for its capital expenditure projects next year, double what it spent this year. ”Our expansion program targets to put


up 10 stations next year to bring our total number of stations to 45 stations by next year,” he said. Eastern Petroleum is a Filipino-owned oil company that set up shop following government’s decision to open up the re- tail market to competition more than a decade ago.


As part of the company’s expansion


plans, Eastern Petroleum targets to put up a number of “mega” stations, pump out- lets complemented by other commercial establishments like fast food outlets and


convenience stores. ”Another mega station in the works is the one in Cavite along the Coastal Road by May next year. We even acquired half a hectare of land along the Coastal Road,” Martinez said. Last year, the oil firm generated revenues of P2 billion. The company expects to increase its sales further this year primarily because of the supply disruption endured by its big- ger competitors, Pilipinas Shell Petroleum Corp. and Chevron Philippines, Inc., fol- lowing the shutdown of the petroleum pipeline that delivers their products to Metro Manila. ”We might reach the P3.2 billion mark


this year. We have yet to project the level of net income for the year. But it will surely be better than last year,” he said. EUAN PAULO C. AÑONUEVO


BSP rediscounting loans fall


THE Bangko Sentral ng Pilipinas (BSP) said the amount of rediscounting loans is- sued to commercial, thrift and rural banks in the first 11 months this year fell from a year ago.


Data from the central bank showed that


the level of availments for the January to November period reached P47.5 billion, or 71.3 percent lower than the P165.4 bil- lion last year.


Of the total loans, 54.3 percent went to commercial credits, 5.6 percent to agricul- tural and industrial credits, and 40.1 per- cent to other credits.


The total loans under the peso redis- count facility exclude the P9-million rediscounting loans granted to micro, small and medium enterprises (MSMEs) affected by typhoons “Ondoy” and “Pepeng” in late 2009.


The BSP established an additional P5- billion budget for rediscounting to cover for typhoon-affected MSMEs. Total availments under the exporters dollar and yen facility of the seven big- gest commercial banks went up 43.5 per- cent to $70.3 million in November from $49 million last year. This benefited at least 28 exporters, the BSP said. No bank availed of the yen-denomi- nated facility during the period. For December, the central bank has not changed the rediscounting rates applicable on loan availments for banking institutions.


The peso rediscounting rate is set at 4 percent for all maturities effective Febru- ary 1, while those of dollar and yen rates


are at 0.26063 percent and 0.12000 per- cent a year, respectively.


The rediscounting facility is a standing credit facility provided by the BSP to help banks liquefy their position by refinanc- ing the loans they extend to their clients. It is a privilege of a qualified bank to obtain loans or advances from the BSP using the eligible papers of its borrowers as collateral.


The BSP expanded its peso-redis-count- ing budget to P60 billion in March last year from P40 billion to provide ample liquidity to the system against any possi- ble credit tightness that may develop from the global financial turmoil.


The increase came alongside the liber- alization of the rediscounting guidelines in February last year.


On April 22 the Monetary Board de- cided to reduce the peso rediscounting budget from P40 billion to the pre-crisis level of P20 billion, effective May 3, in light of favorable credit and liquidity con- ditions and to reduce potential inflation- ary risks. BSP Governor Amando Tetangco Jr. said monetary authorities could maintain policy rate settings at their current levels since the local financial markets continue to stabilize and the inflation outlook re- mains manageable.


The BSP has been maintaining its key policy rates at 4 percent and 6 percent for the overnight borrowing and lending win- dows, respectively, since July 2009 to encour- age lending and fuel economic activity. LAILANY P. GOMEZ


Development Program Partici- pants Association (MDPPA) showed that at end-November, the group’s six member- companies sold 684,371 units, up 19 percent from 575,423 in the same 11-month period last year.


The association’s members


target to sell a total of 700,000 units this year, about a tenth


higher than last year’s industry sales of 637,792 units. MDDPA groups Eastworld


Motor Industries Corp. (assem- bler of Motorstar), Honda Philippines Inc., Kawasaki Motors Philippines Corp., Kymco Philippines Inc., Suzuki Philip- pines Inc., and Yamaha Motor Philippines Inc.


BEN ARNOLD O. DE VERA LEGAL NOTICE REPUBLIC OF THE PHILIPPINES SPECIAL COMMITTEE ON NATURALIZATION


IN THE MATTER OF THE PETITION OF SAMMUEL SY LIM to be naturalized as Filipino citizen pursuant to Republic Act No. 9139


X ––––––––––––––––––––––––X PETITION


Pursuant to the provisions of Republic Act No. 9139, petitioner hereby submits a petition for naturalization to become a citizen of the Republic of the Philippines and respectfully declares:


1. My full name is SAMMUEL SY LIM but I have also been known since childhood as SAMUEL SY LIM or I have been judicially authorized to use the alias name(s) N/A.


2. My present place of residence is 230-E Pilar Street City/ Municipality of Mandaluyong City, Province of Metro Manila and all my former places of residences are:


101 Diego Silang St., Batangas City (1966-1997) 22 G. Araneta Ave., Quezon City (1979-1984) 4001-D Sociego St. Sta. Mesa, M.M. (1984-1988) 150-L Aurora Blvd., San Juan, M.M. (1997-1999) 54 Lt. Artiaga St. San Juan, M.M. (1999-2006)


3. I was born on September 24, 1966 in Batangas City, Philippines. I have been a resident of the Philippines since birth. At present, I am a citizen or subject of China.


4. My father’s name is Juan T. Lim and he was born on May 1, 1937, in Batangas City. He is a citizen or subject of China.


My mother’s name is Concepcion Sy Lim and she was born on July 10, 1942, in Manila. She is a citizen or subject of China. 5. My trade, business, profession or lawful occupation is Account Executive and from which I derive an average annual


income of P220,513.55 inclusive of bonuses, commissions and allowances. My wife’s/husband’s trade, business, profession or lawful occupation is Sales Account and from which she derives an average annual income of P135,335.00.


6. My civil status is Married. I was married on December 21, 1997 in Manila. My wife’s name is Emy Lee Lim and she was


born on June 18, 1971 in Manila. She is a citizen or subject of China and presently resides at 230-E Pilar St., Mandaluyong City. 7. I have 3 child/children, whose names, dates and places of birth and residences are as follows:


Name


Shaun Ellis L. Lim Shannen Elle L. Lim Shaine Erin L. Lim


Date of Birth Place of Birth Dec. 25, 1998 Nov. 7, 2001 Nov. 1, 2004


Manila Manila Manila


Residence


230-E Pilar St., Mandaluyong City ““ ““


8. I received my primary and secondary education from the following public schools or private educational institutions duly recognized by the Department of Education, Culture and Sports (DECS), where Philippine history, government and civics are taught and prescribed as part of the school curriculum and where enrollment is not limited to any race or nationality:


Name of School


Kipsi Elem. School Hope Christian H.S. Hope Christian H.S.


PSBA-Phil. Sch. of Bus. Adm.


Place of School Dates of Study Batangas City Manila Manila Manila


1974-1979 1979-1980 1980-1984 1984-1988


Highest Grade Completed Grade 5 Grade 6


4th year high school 4th year college


9. I am able to read, write and speak Filipino and/or any of the following dialects of the Philippines: Filipino/Tagalog


10. I have enrolled my minor children of school age in the following public schools or private educational institutions duly recognized by the Department of Education, Culture and Sports (DECS), where Philippine history, government and civics are taught and prescribed as part of the schooI curriculum and where enrollment is not limited to any race or nationality:


Name of Child


Shaun Ellis Lim Shannel Elle Lim Shaine Erin Lim


Name and Place of School


MGC New Life Christian Academy MGC New Life Christian Academy MGC New Life Christian Academy


Date of Enrollment May 19, 2010 May 19, 2010 May 19, 2010


11. I shall never be a public charge. I am of good moral character. I believe in the principles underlying the Philippine Constitution. I have conducted myself in a proper and irreproachable manner during the entire period of my residence in the Philippines in my relations with the constituted government as well as with the community in which I am living. I mingled socially with Filipinos and have evinced a sincere desire to learn and embrace the customs, traditions and ideals of the Filipino people. I have all the qualifications and none of the disqualifications under Republic Act No. 9139.


I am not opposed to organized government or affiliated with any association or group of persons who uphold and


teach doctrines opposing all organized governments. I am not defending or teaching the necessity or propriety of violence, personal assault or assassination for the success and predominance of one’s ideas. I am not a polygamist nor a believer in the practice of polygamy. I have not been convicted of any crime involving moral turpitude. I am not suffering from mental alienation or from any incurable contagious disease. The country of which I am a citizen or subject is not at war with the Philippines and grants to Filipinos the right to be naturalized citizens or subjects thereof.


12. It is my true and honest intention to become a citizen of the Philippines and to renounce absolutely and forever all allegiance and fidelity to any foreign prince, potentate, state or sovereignty, and, particularly toChina of which all this time I am a citizen or subject. I will reside continuously in the Philippines from the date of the filing of this petition up to the time of my admission to Philippine citizenship.


PRAYER WHEREFORE, it is respectfully prayed that petitioner be conferred Philippine citizenship pursuant to the provisions of


Republic Act No. 9139. Dated at Makati City, Metro Manila, this 4th day of October, 2010.


SAMMUEL SY LIM


Name and Signature of Petitioner Address: 230-E Pilar St. Mandaluyong City


Right Thumbmark of Petitioner


Petitioner’s signature and right thumbmark MT – Dec. 6, 13 & 20, 2010 SCN CASE NO. 000387


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