BIZ BUZZ: Win-win . . . for now
W hen a big financial institution is implementing a major cleanup of the proverbial cobwebs in its house, some insiders who are comfortable with the status quo are bound to raise a ruckus.
And so it was with the Philippine National Bank (PNB) after its president, Wick Veloso, was brought in a few years ago to shake things up and buttress its position among the country’s banking giants.
No sooner had he started moving key people around and looking into restructuring unprofitable segments did the grumbling start.
But recent successes seem to have proven his strategies right.
Take for instance Veloso’s decision to monetize some of the large pieces of real estate in the bank’s portfolio of foreclosed assets.
One property, in particular, attracted a lot of attention from some parties who did not want to see the status quo disturbed. We’re talking about a 3.2-hectare parcel of land that is strategically located in the Port Area of Manila, specifically the Manila Harbour Centre.
Biz Buzz hears that this piece of foreclosed real estate was originally valued at only P1.5 billion on the bank’s books. Veloso had it reassessed by a third party evaluator who then said that it was worth more than P2 billion. Not happy with that, the PNB chief sought a third opinion which then pegged the market value of the property at P3.2 billion.
That, then, became the new baseline for the bank’s auction of the property, while upsetting some parties who—for one reason or another—did not want it disposed of … or perhaps wanted the property for themselves.
After the bidding, port operator ICTSI emerged with a winning bid of P3.68 billion—far above what old-time insiders thought the value of the property was. It was a big win for the bank, and a big win for its president.
We hear that this transparent deal quieted some people among the bank’s shareholders who have been unhappy with—or affected by—Veloso’s reform moves. The question, of course, is … for how long will they stay quiet? Abangan!
— Daxim L. Lucas
Speaking of which . . .
Philippine National Bank (PNB) said on Thursday that it has been recognized by Asiamoney as the “Best Bank for Investment Research in the Philippines” for the second consecutive year during its Private Banking Awards on April 25.
PNB’s research division is headed by vice president and bank economist Alvin Arogo who said he was “humbled” by this recognition from Asiamoney.
“This further motivates us to deliver relevant, up-to-date, and useful economic and market insights to our investors, clients, and the general banking public,” he said, nothing that the PNB research team provided predeal research work for the various deal executions of its investment banking subsidiary last year, namely DoubleDragon Meridien Park REIT, Monde Nissin, RL Commercial REIT Inc., AllDay, Synergy Grid, Keepers and Medilines.
In 2021, the PNB research team published 212 reports covering economic and equity research, providing up-to-date investment ideas.
—Daxim L. Lucas
New word for the new normal
It’s common knowledge that bankers are some of the most creative professionals when it comes to making money. They’re so good at it that some of the more successful ones try their hand at other artistic endeavors.
And so, it was during the annual stockholders’ meeting of Bank of the Philippine Islands (BPI) when president Jose Teodoro “TG” Limcaoco dropped the new word “phigital” on unsuspecting stockholders.
He was referring to how BPI plans to improve its traditional and highly profitable banking services while embracing the digital age. BPI is both physical and digital thus it is “phigital,” Limcaoco said without the slightest fidget.
A cursory search would show the word was not so new and had been referenced by a variety of think pieces and technology influencers over the past few years.
It was novel enough for BPI chair Jaime Augusto Zobel de Ayala, who dryly quipped during the meeting, “That’s a new word for me, TG. We will remember that one.”
Literary inventions aside, the BPI Limcaoco heads is clearly laying down goals as part of its quest for sustainable growth and profitability.
This includes a major leap as the first and only lender to commit to winding down coal power financing to half the portfolio by 2026 and down to zero by 2032. It also announced ending the financing of greenfield or new coal power projects moving forward.
The company is revamping its customer service focus, recently creating the chief customer and marketing officer position.
It will reinforce its commitment to sustainability, quantified through environmental, social and governance (ESG) measures. This will be pursued both on an institutional level and by each of the company’s 19,000 employees.
With their sustainability agenda in place, Limcaoco said ESG metrics would be embedded in all employee performance evaluations beginning 2022.
“At BPI, we have a strong vision for the future. We know that, to remain successful, we have to pivot to be more innovative as we pursue banking excellence anchored on trust and the best digital offers in the country,” he said during the meeting.
