BSP issues new policy on capitalization of Islamic banks

By Julito G. Rada

THE Bangko Sentral ng Pilipinas said over the weekend it approved a new policy on minimum capitalization requirement for the operation of Islamic banking units in the Philippines.

The modified policy allows conventional commercial banks or subsidiary banks of a universal bank—which meet the minimum capital requirement for their respective banking category—to operate an Islamic banking unit within a transitory period not exceeding five years.

BSP Governor Felipe Medalla said the policy provides more flexibility in licensing of an Islamic banking unit of qualified conventional banks.

“The BSP aims to incentivize the conventional banks to test, explore and develop the market for Islamic banking products and services with prudential safeguards to support the entry of a critical mass of Islamic banking players in the country,” Medalla said.

Qualified conventional banks with Islamic banking units will also be accorded prudential relief in meeting the minimum capital requirement which will be based on the actual number of branches/units being used in Islamic banking operations.

The application of BSP’s enforce- ment framework provides prudential safeguards to ensure accountability on the committed business plan and capital build-up plan after the transitory period of covered banks with Islamic banking units to promote market discipline in the financial system. The BSP said it intensifying its efforts to establish an inclusive and sustainable Islamic finance ecosystem in the country. The BSP’s prudential regulatory reforms on Islamic banking cover licensing, Shari’ah governance, liquidity risk management and reporting guidelines, which were recently issued under BSP Circular No. 1139.

Pse Index Closing

“With the restoration of our ecozone export-oriented locators’ incentives, including VAT zero rating/exemption on goods and services that are directly and exclusively used in their registered activity, this will improve their bottomline and capacity to reinvest in the country,” he said.

PEZA said the VAT zero rating, as amended by the Bureau of Internal Revenue, would attract new investors to take advantage of the incentives and benefits offered by the Corporate Recovery and Tax Incentives for Enterprises Act.

PEZA said that as locators are spared from the VAT refund process, the regulation would also benefit local suppliers who are no longer required to apply with the BIR for the VAT zero rating of their transactions.

The certification issued by investment promotion agencies will be the basis for availing of the VAT zero rating incentive. This will strengthen the role of IPAs in investment facilitation and exercise of regulatory functions over RBEs, according to PEZA.

SMB reported 38% net profit growth to P6.8b in first quarter

By Jenniffer B. Austria

SAN Miguel Brewery Inc., a joint venture of San Miguel Corp. and Japan’s Kirin Holdings Co., reported a double-digit net income growth in the first quarter.

SMB said in a statement over the weekend first-quarter net income jumped 38.2 percent to P6.8 billion on the back of strong sales performance of both domestic and international operations amid the continued easing of COVID-19 restrictions.

UNIONDIGITAL-HUAWEI TIEUP. UnionDigital Bank, the digital bank subsidiary of Union Bank of the Philippines, teams up with global technology leader Huawei to bring innovative financial services to more people in the Philippines by tapping into the tech company’s ecosystem of services and 7 million customer base. Through the strategic collaboration, the UnionDigital Bank app is now available on the Huawei AppGallery to allow easy access for users to the digital bank’s financial services and products. Attending the signing of the agreement are (from left) Kevin Zang, gead of Petal Ads, Huawei APAC; Ken Liang, director of Philippines Ecosystem Development and Operation, Huawei Technologies Philippines; Henry Aguda, president and chief executive of UnionDigital Bank; and Mike Singh, chief commercial and revenue officer of UnionDigital Bank.

ACEN bares $8-b investment plan to achieve 8,000 MW of renewable projects in PH until 2030

ACEN Corp., the power generation arm of Ayala Corp., is building 8,000 megawatts of renewable energy projects in the Philippines until 2030 with investments of about $8 billion. ACEN president and chief executive Eric Francia said about 600 MW of RE capacity was already in operation, while 1,000 MW was under construction, of which 70 percent would soon be operational.

Francia said the Philippines would remain as ACEN’s core market at 40 percent of the 20,000-MW target by 2030, followed by Australia with a footprint of

5,000 MW.

“In addition, we will continue to grow our presence in Vietnam, Indonesia and India. Onshore solar and wind will remain our core energy technologies, complemented by investments in new technologies such as battery energy storage, floating solar and offshore wind,” Francia said.

ACEN plans to build 3,000 MW in Indonesia and other markets, 2,000 MW in Vietnam and 2,000 MW in India by 2030.

“If you look at last couple of years, we’ve been starting close to one gigawatt of new projects every year...Today, we already have a little over 4 GW of capacity both operating and under construction,” Francia said.

“At some point, we have to ramp up or step up or go beyond 1 GW-per-year mark because if we stay at 1 GW per year with eight years to go, we’re not gonna get to 20 GW,” he said.

Francia said ACEN would accelerate project development closer to 2 GW towards mid to end part of the decade.

ACEN is also moving forward with its commitment to achieve net zero greenhouse gas emissions by 2050, which fully supports the company’s ongoing growth and decarbonization strategy.

ACEN completed in December its net zero roadmap, making the company the first in Southeast Asia to take the critical step towards achieving net zero, with a transparent framework for monitoring progress.

“ACEN recognizes that to reach the net zero outcome for the power sector, it will need to rely on both emissions reduction and neutralization of residual emissions.

As part of its transition plan, ACEN aims to deliver reduction-led decarbonization by 2040, with an interim target for 2030, and a net zero status by 2050,” he said. Alena Mae S. Flores

First-quarter revenues climbed 29.3 percent to P38.3 billion from P29.7 billion in the same period last year.

Consolidated operating income grew 25 percent to P8.4 billion.

SMB’s domestic beer volumes grew by 26.1 percent, boosted by new brand campaigns and offtake-generating programs, complemented by relaxed restrictions.

International operations posted a 28.5-percent increase in sales volume from its exports business and Hong Kong operations. Volumes were still 16.4 percent lower compared to 2019 pre-pandemic levels.

SMB said that in the first quarter, it rolled out the San Mig flavored water—a refreshing unsweetened noncarbonated drink and San Mig Hard Seltzer—which is made from sparkling water with a 5-percent alcohol.

It also recently launched San Miguel Cerveza Blanca—a wheat beer positioned in the upscale market. SMB exports to Indonesia, Thailand, United Arab Emirates, Qatar, the United States and Bahrain. It recently expanded in new markets in Asia and Africa.