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Biz Buzz: New blood, new life for PCCI

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Biz Buzz: New blood, new life for PCCI

/ 12:15 AM March 06, 2017

What should three businessmen do for an encore after building, from the ground up, one of the most successful mass housing firms in the Philippines in recent years? Well, going into financial services might be a good idea.

This seems to be the path that the founders of 8990 Holdings Inc. have embarked, after Biz Buzz learned that the three gentlemen behind the group —Mariano Martinez, Jesus Atencio and Luis Yu Jr.—have bought into Philippine Commercial Capital Inc. Known as PCCI (not to be confused with the Philippine Chamber of Commerce and Industry) in the tightly knit Filipino financial community, the firm has been around in the early 1980s and has been a pioneer of sorts in the local investment banking scene.

We understand that the 8990 founders are making this investment in their personal capacities, along with a few partners in the financial services field who will help them run PCCI and make it better able to compete with banking behemoths that have managed to corner the bulk of underwriting and investment banking deals in recent years.

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One banker who is expected to join the PCCI team (both as a shareholder and company official) is former Security Bank executive vice president Rafael Algarra. Formerly a ranking treasury department official
(a co-head in fact) at Security Bank, Algarra left the mid-sized universal bank in 2015, allowing him a restful hiatus of almost two years.

Another finance man joining the new PCCI is Federico Galang, who will serve as the president and CEO of the investment house. Incidentally, Galang and Algarra share a common corporate background since the former also served in the Security Bank group as the president of its investment house unit, SB Capital.

All this may, of course, prove to be a boon for the foreign exchange market-savvy Algarra since an investment house like PCCI can still be very much active in the FX market (where prospects of profitability are increasing because of the peso’s rising volatility). More importantly, investment houses like PCCI are not directly supervised by the Bangko Sentral ng Pilipinas when it comes to dollar trading, since BSP is focused primarily on guarding against malpractices of banks.

Instead, investment houses are under the supervisory ambit of the Securities and Exchange Commission, which, as many know, is understaffed and may not have the necessary personnel competent enough to monitor the rocket science involved in FX trading.

Given these new guys’ diverse and colorful backgrounds, the market should expect exciting developments coming out of PCCI very soon. —DAXIM L. LUCAS

COL investor index

In a survey conducted last January, leading online stockbrokerage COL Financial found out that most of its affluent investors—or those with a minimum investment portfolio of P1 million—are upbeat on the stock market.

The COL survey, which was based on a sample size of 10,000 customers (with average age of 45), showed that 24 percent of affluent investors were “strong bulls” or those who expect the Philippine Stock Exchange index (PSEi) to reach 8,100 or above by yearend. Thirty-five percent are “weak bulls” or those expecting the PSEi to rise to 7,700 but less than 8,100 by yearend. In the same survey, those who are neutral—who expect the PSEi to end at 7,300 to 7,700 by yearend—accounted for 31 percent.

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“Weak bears,” those who project the PSEi to end at 6,500 to 7,300 or lower than or at best flat from current levels, comprised 7 percent while “strong bears” or those who see the PSEi tumbling to 6,500 or below by yearend, account for only 4 percent.

Given that 59 percent of these affluent investors (defined as the segment of the upper middle-class folks who derive part of their income from investment) are bulls, this partly explains why domestic buying has managed to keep the market afloat in recent weeks even on days of heavy foreign selling.

The same COL survey showed that 42 percent of respondents had more than 75 percent of their portfolio invested in stocks while 30 percent had 50 to less than 75 percent of their portfolio invested.

Capitalizing on its vast number of retail customers, COL plans to make the confidence survey a quarterly exercise and soon develop a retail investor confidence index. The index will derive insights not just from the affluent retail investors but the general spectrum of investors. This seeks to offer a pioneering gauge of domestic investors’ conviction on the local stock market, which will be interesting to compare with general consumer confidence surveys regularly conducted by other institutions such as the Bangko Sentral ng Pilipinas. —DORIS DUMLAO-ABADILLA

‘Secretary-designate’ dig

Before he reentered government service last year, Finance Secretary Carlos Dominguez III was living in semi-retirement, shuttling between his local business interests and his home in the US where he takes out his rifle to hunt deer during hunting season.

And everyone who knows Dominguez knows that he is deliberate in his words and methods, whether it is in business, government service, or hunting … where patience is required, sometimes for days on end, to wait for the prey to walk into the crosshairs of one’s rifle.

And so it was—or so it seemed—during last week’s press briefing in Malacañang where the finance chief was asked to speak about the ongoing dispute between the mining industry and antimining crusader and Environment Secretary Regina Lopez.

It was innocuous at first, with many observers failing to catch the subtle dig the first time it was uttered. But he said it again. And again. And again.

What exactly did Dominguez say? Well, he was being precise when he referred to Lopez as “Secretary-designate.”

Lopez, of course, faces rough sailing before the Commission on Appointments for her take-no-prisoners stance against mining, something that has greatly upset the Philippine business community, the mining industry (from which many leaders supported President Duterte’s 2016 campaign) and not to mention residents and workers of affected mining communities nationwide.

In any case, Dominguez correctly pointed out that Lopez’ appointment has yet to be confirmed and, as such, is addressed officially as “Secretary-designate.”

Well, yes, but no one in the Philippine setting really uses that term to address presidential alter egos unless they wanted to drive home a point, right? And no one dares call Lopez that, given her family’s background, wealth and influence. But hey, Dominguez has his own self-made background, billions and influence to speak of, so the two are right up there in their own league.

And if that subtle dig wasn’t enough, Dominguez made a more emphatic statement: “You know, being secretary is not like being a crusader. Being secretary is balancing the needs of the different sectors in society, okay?”

He should know. He was secretary of environment and natural resources himself during the early years of the Cory Aquino administration. —DAXIM L. LUCAS

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TAGS: Carlos Dominguez III, housing, Stock
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