BUSINESS Foreign direct investments fell 34% in May

By Julito G. Rada

NET inflows of foreign direct investments fell 34 percent in May to $488 million from $739 million a year ago, as elevated inflation and higher interest rates impacted investors’ sentiments globally, the Bangko Sentral ng Pilipinas said Thursday.

It said in a statement the decline in FDI net inflows reflected the 70.7-percent contraction in non-residents’ net investments in debt instruments to $161 million from $551 million in the same month last year.

Non-residents’ net investments in equity capital, other than reinvest-

In Brief

Megaworld’s six-month net profit rose to P7.9b

PROPERTY developer Megaworld Corp. said Thursday attributable net income reached P7.9 billion in the first half of 2023, up from last year’s P5.9 billion on the back of sustained performance of core businesses.

Consolidated revenues grew 17 percent to P32 billion, boosted by the strong performance of residential, mall and hotel businesses.

“Our steadfast focus on our township model allowed us to sustain our strong performance into the second quarter of the year. With increasing demand for residential and commercial properties outside Metro Manila, we have properly positioned ourselves achieve growth through strategic land banking,” Megaworld chief strategy officer Kevin Tan said in a disclosure to the stock exchange.

Real estate sales went up by 12 percent year-on-year to P19.1 billion, driven by higher completion rate of various projects. Reservation sales increased 49 percent to P76.1 billion and represented 59 percent of the company’s year-end reservation sales target of P130 billion.

The company said it saw a strong uptick in demand for residential projects in two Taguig townships, particularly in McKinley West and Uptown Bonifacio.

Megaworld launched P28.2 billion worth of projects across the country in the first six months of the year. Jenniffer B. Austria

Converge’s income climbed 24.7% to P4.28b in first half

CONVERGE ICT Solutions Inc. said Thursday net income grew 24.7 percent in the first half of 2023 from a year ago on the back of higher revenues from residential and enterprise segments. The country’s only pure-play high-speed fixed broadband operator earned P4.28 billion from January to June, up from P3.95 billion in the same period last year.

Consolidated revenues increased 8.1 percent in the six-month period to P17.36 billion from P16.05 billion a year earlier.

Revenues from the residential business rose to P14.87 billion from P14.08 billion, while the enterprise segment’s revenue went up to P2.48 billion from P1.96 billion.

“We have sustained our growth with our newly-opened areas particularly in Northern Luzon, Visayas and Mindanao contributing more to our subscriber base,” the company said. Darwin G. Amojelar

DBP’s profit surged 60% to P4.42b in six months

STATE-OWNED Development Bank of the Philippines’s net income in the first six months of 2023 jumped 60 percent to P4.42 billion from P2.76 billion in the same period last year, a top executive said Thursday. DBP president and chief executive Michael de Jesus said the increase was fueled by a hike in foreign currency profits on its foreign books and non-recurring gains from the disposal of real and other properties acquired.

“Notwithstanding the one-time gains, overall the bank’s performance in the first half of the year demonstrates its resilience as an institution and its readiness to support the National Government’s strategic initiatives to foster economic growth and financial stability,” de Jesus said.

De Jesus said the bank was on track to meeting its full-year income target of P5.20 billion. He said loans for infrastructure and logistics accounted for the bulk of outstanding exposure at P281.59 billion, followed by loans to social infrastructure and community development at P110.03-billion.

“A significant chunk of our loans or about 55.5 percent percent of the bank’s total portfolio of P507 billion was released to bankroll public infrastructure under the banner of the national government’s ‘Build Better More’ program, majority of which are in the National Capital Region, Central Visayas, Davao, and Central Luzon,” de Jesus said. Julito G. Rada ment of earnings, increased 158.7 percent to $235 million from $91 million in May 2022.

“FDI remains subdued due to the effects of relatively higher price and interest rate levels globally,” the BSP said.

It said equity capital placements in

May came mostly from Germany, Japan and the United States. These were invested largely in the manufacturing and real estate industries.

Net FDI inflows in the first five months also shrank 20.8 percent to $3.4 billion from $4.3 billion a year ago.

The BSP statistics on FDIs are compiled based on the Balance of Payments and International Investment Position Manual, 6th Edition. They include investment by a non-resident direct investor in a resident enterprise, whose equity capital in the latter is at least 10 percent and investment made by a non-resident subsidiary/associate in its resident direct investor.

FDIs can be in the form of equity capital, reinvestment of earnings and borrowings. The BSP FDI statistics are distinct from the investment data of other government sources. BSP FDI covers actual investment inflows. By contrast, the approved foreign investments data that are published by the Philippine Statistics Authority, which are sourced from investment promotion agencies, represent investment commitments which may not necessarily be realized fully, in a given period.

The PSA data are also not based on the 10-percent ownership criterion under BPM6. Meanwhile, the BSP’s FDI data are presented in net terms