NUMBER OF BASIC DEPOSIT ACCOUNTS INCREASE

The total amount of funds in basic deposit accounts (BDA) of banks increased to P36.7 billion in the last quarter of 2023, or three times higher than the P11.96 billion in the same period of the previous year, according to the Bangko Sentral ng Pilipinas (BSP).

The BSP added that the total number of BDA holders went up by 58% to 24.2 million in the fourth quarter of 2023 from 15.3 million in the same period of 2022.

Among the factors attributed to the increase in BDA accounts is there are financial institutions requiring only an initial deposit of P100, without minimum maintaining balance and dormancy charges. Also, minimal identification requirements were implemented by banks, making opening a BDA account easier.

However, the Philippine Deposit Insurance Corporation (PDIC) recently reported that the country’s gross domestic savings dropped to 9.2% at the end of 2023 compared to 17.5% in 2017.

“The concept of saving isn’t very strong yet in Philippine culture. It looks like there is a mechanism that we have our parents and neighbors to turn to. Let us start with the basic, let us save,” said PDIC Vice President for Corporate Affairs Jose Villaret partly in Filipino.

TARLAC BACKS LANDFILL CONVERSION INTO INDUSTRIAL ZONE

A number of local government units (LGUs) in Tarlac are backing the conversion of the Kalangitan sanitary landfill in Capas into an industrial zone as part of the development of the New Clark City (NCC).

The Bases Conversion and Development Authority said on June 13 that its president and chief executive officer Joshua Bingcang met with Tarlac local officials, including Governor Susan Yap, Vice Governor Carlito David, and Board Members Joy Gilbert Lamorena and Henry Cruz, as well as Capas Mayor Roseller Rodriguez last May 29 and June 5, to discuss the contract expiration of Metro Clark Waste Management Corp.’s (MCWMC) for the Kalangitan sanitary landfill.

Bingcang presented to the local officials BCDA’s plan to redevelop the 100-hectare parcel of land where the Kalangitan sanitary landfill is located.

“The 100-hectare landfill area will be rezoned under our New Clark City Master Development Plan. We estimate about 30,000 jobs to be generated from the industrial redevelopment of the area,” he said.

MERALCO HIKES RATES AGAIN

The Manila Electric Company (Meralco) has increased its electricity prices for June, or by P0.6436 per kilowatt hour (kWh), marking the second straight month the company adjusted its rates upwards.

Meralco announced on June 14 that the electricity rate this month is now at P12.0575 per kWh from P11.4139 per kWh in May.

Residential customers consuming 200 kWh may expect their bills to go up by P129 this month.

Meralco blamed the higher power rate this month to the overall rate increase in the generation charges, going up by P0.3466 per kWh, because of the higher costs from the Wholesale Electricity Spot Market (WESM).

WESM prices were higher last month by P1.5203 per kWh, Meralco said.

NEW SSS PENSION PROGRAM TO HELP FILIPINOS IMPROVE THEIR FINANCES

The new pension program of the Social Security System (SSS) will help help boost the financial security of Filipinos, Finance Secretary and SSS Chairperson Ralph Recto claims.
In a statement on June 12, Recto said the MySSS Pension Booster launched on June 10 will help ensure the financial security of Filipinos.

“This program aligns perfectly well with the national government’s ongoing efforts to ensure financial security for all Filipinos, which is the cornerstone of inclusive growth,” he said.

The MySSS Pension Booster is a retirement savings program composed of both mandatory and voluntary schemes such as the Workers’ Investment and Savings Program (WISP) and WISP Plus, respectively.

The Booster is an additional benefit to the monthly pension from the retirement benefit under the regular SSS program.

It is voluntary, affordable, and a tax-free savings scheme with a low management fee of 1 percent per annum, that will be charged to the total accumulated account value of the SSS member.

ASSETS OF BANKS IN PHILIPPINES UP 12% IN MAY

The total assets of the Philippine banking sector went up by 12% as of end-April this year.
Latest data from the Bangko Sentral ng Pilipinas (BSP) released on June 12 showed that the total assets of the Philippine banks increased to P25.48 trillion from P22.75 trillion in April last year.

However, the total assets of the country’s banking sector during the month, was lower than the P25.6 trillion recorded in March this year.

Reacting to the latest figures on the country’s banking sector, Rizal Commercial Banking Corporation chief economist Michael Ricafort said the 12% year-on-year growth is more than twice the country’s gross domestic product growth.

He said that this is “a good signal on the resilience of the banking industry, as this also reflects loan growth near 10% recently that would still be a bright spot for the Philippine economy.”

IMF: PH FISCAL CONSOLIDATION TO BE SUSTAINED IN MEDIUM TERM

The fiscal consolidation of the Philippines will be sustained over the medium term but at a slower pace than initially expected, an official of the International Monetary Fund (IMF) said.

“The latest Medium-Term Fiscal Program presents a more pro-growth fiscal stance anchored around higher capital spending and a more gradual increase in revenues over the medium term,” IMF Mission Chief Elif Arbatli Saxegaard said in a briefing at the Bangko Sentral ng Pilipinas office in Manila.

To recall, the Development Budget Coordination Committee revised the government’s fiscal targets to reflect the current global and domestic environment and ensure that more strategic and growth-enhancing fiscal consolidation is being pursued.

Under the revised medium-term fiscal program, the government is aiming to bring down the fiscal deficit to 5.6% of gross domestic product (GDP) this year to about 3.7% of GDP in 2028.

As for government revenues, these are projected to reach P4.2 trillion this year 2024 and P6 trillion in 2028. Disbursements will likely reach P5.7 trillion this year and P7.4 trillion in 2028.

$2.7-B DATA CENTER TO RISE IN TARLAC

Manila-based ENDECGROUP, whose core business is construction and engineering, is investing $2.7 billion (P158 billion) in a data center facility in Tarlac.

On June 11, ENDECGROUP and Narra Technology Park Development Inc. Managing Director William Johnson and Tarlac Governor Susan Yap signed the lease contract deal for the 47-hectare land within the New Clark City (NCC), where the Narra Technology Park will be located.

The Narra Technology Park will house a 300-megawatt (MW) hyperscale data center—the country’s largest data center facility, so far—that will be built in three phases at 100 MW each.

Johnson said his company is investing $890 million in each phase, with the first 100-MW targeted to be operational in the fourth quarter of 2026. Another $35 million will be invested for site development.

“We expect the Narra Technology Park to put the Philippines on the map in the hyperscale data center market,” Johnson said.

MARCH FDI NET INFLOWS UP 23% IN MARCH

Foreign direct investments (FDI) net inflows went up by 23.1% in March this year, reaching $686 million from $557 million net inflows in the same month last year.

“The expansion in FDI net inflows was driven mainly by nonresidents’ net investments in debt instruments, which grew by 19.0 percent year-on-year to $465 million from $391 million in March 2023,” the Bangko Sentral ng Pilipinas (BSP) said on June 10.

Nonresidents’ net investments in equity capital also grew by 67.1% from to $157 million from $94 million .

Reinvestment of earnings, however, declined by 11.3% to $64 million in March 2024 from $72 million in March 2023.

FDIs include investment by a nonresident direct investor in a resident enterprise, whose equity capital in the latter is at least 10%, and investment made by a nonresident subsidiary or associate in its resident direct investor.

IMF SEES PH ECONOMY GROWING BY 6% THIS YEAR

An International Monetary Fund (IMF) official said that Philippine economic growth is expected to hit 6% this year from 5.5% in 2023.

“Growth is expected to rebound to 6% in 2024 and 6.2% in 2025, on the back of stronger consumption demand, higher public and private investment, and a recovery in exports,” IMF Mission Chief Elif Arbatli Saxegaard said in a briefing at the Bangko Sentral ng Pilipinas Office in Manila on June 10.

For next year, the IMF official said the drivers for Philippine growth include the continued pick-up in domestic demand, investment, and consumption.

“We think that some of the measures, for example, some of the factors, including continued declines in inflation, as well as the monetary policy easing that is associated with that, will be probably even more supportive in 2025 given the lags,” she said.

(PHOTO FROM PNA BY YANCY LIM)