BIZ BUZZ: Kinks in PDS takeover plan

Now that the Philippine Stock Exchange and the Bankers Association of the Philippines are going back to the negotiating table for the former’s acquisition of the Philippine Dealing System Holdings Corp. (PDS), other issues are expected to hound the much-awaited unification of the country’s capital market infrastructure apart from revisiting the pricing level.

During the last merger talks prior to the pandemic, banks wanted to include a provision that would give them—being the captive market of PDS—the option to leave and set up their own, if they see the need to do so.

PDS is the holding firm for fixed-income trading platform Philippine Dealing and Exchange Corp. (PDEx), Philippine Depositary and Trust Corp. (PDTC) and Philippine Securities Settlement Corp.

On the part of the PSE, the most compelling unit of all three is PDTC as having such an entity could allow the bourse to easily monitor the transfer of shares between brokers, thereby improving risk management controls. The P700-million R&L Investment scandal in 2019 was partly blamed to the lack of such a mechanism.

But according to a senior banker familiar with the issue, because PDS is effectively a “monopoly,” banks would otherwise have no choice but to accept whatever service fee pricing the new operator will dictate. As such, they prefer to have an exit mechanism if they disagree with the fees and charges to be imposed.

This has been a bone of contention in the past and is likely to be raised again by the banking industry in this new round of talks, our banking source says. —Doris Dumlao-Abadilla

Metrobank fund management plums

It’s just the latest in a recent string of awards for the Ty family-led Metropolitan Bank & Trust Co. after the financial giant received more recognition from the Fund Managers’ Association of the Philippines (FMAP).

During FMAP’s recent 23rd Annual Awards Night, the association named Metrobank one of the 2023 Best Fixed Income Houses in the country.

The group also recognized several members of Metrobank’s financial markets team, namely Kathryn Abes (first place under the Best Fixed Income Local Desk Trader category); Tristan de Ocampo (first place under the Best Fixed Income Foreign Desk Trader category); Mark Tan (second place under the Best Fixed Income Foreign Desk Trader category); and Ruben Zamora (second place under the Best Fixed Income Strategist category).

FMAP is an organization composed of local equity and fixed income fund managers.

Every year since 2001, it holds the Bankers and Brokers Poll to name the best analysts, economists, and salespeople as well as equities brokers and fixed income houses.

This year, Metrobank had received accolades from acclaimed international award-giving bodies and Philippine government agencies.

It was named the strongest bank by The Asian Banker for the third consecutive year.

Asiamoney, meanwhile, recognized it as the best domestic bank, the bank with the best service in trade finance; the best bank for ultra-high net worth clients, and best domestic private bank.

It was also recognized for providing top-notch cash management services for Philippine businesses by Euromoney.

The Bureau of the Treasury also named Metrobank the Top Market Maker for 2022 and 2023, besting other government securities eligible dealers, for its efforts in helping the national government to meet its financing requirements and for supporting the initiatives of the National Treasury in enhancing the access of Filipinos to investment opportunities.

It seems that the challenge for the bank’s leadership in 2024 will be repeating this feat or, better yet, improving on it. Abangan! —Daxim L. Lucas INQ