Solon:Stock market boom to help drive jobs creation

THE country’s booming stock market is expected to help drive jobs growth in the months ahead, primarily by enabling publicly traded companies to raise additional capital for business expansion, Makati City Rep. Luis Campos Jr. recently said.

“Some of the nation’s largest listed surging market to sell new shares either through rights offerings or private placements, so they can generate fresh funds for business expansion. And when businesses expand, new jobs are always created,” he said.

Campos made the statement shortly after two of the country’s largest lenders—Metropolitan Bank and Trust Co. (Metrobank) and Bank of the Philippine Islands (BPI)—announced plans to sell P60 billion and P50 billion worth of new common shares respectively via stock rights offerings.

The two banks bared their plans last week, just as the Philippine Stock Exchange (PSE) index hit a new record high of 8,969 points. The PSE index is so far up another 4.1 percent or 257 points this year, closing Friday at 8,915 points. The index closed 2017 up 25.1 percent at 8,558 points.

Both Metrobank and BPI said they intend to use the proceeds from their rights offerings to build up their resources and step up their lending activities to businesses as well as consumers.

Campos also expects the National Treasury to gain from the vibrant trading at the PSE.

amount of tax revenues from the stock market, including those from the stock transaction tax (STT) that Congress increased effective Jan. 1,” he said.

Under the new Tax Reform for Acceleration and Inclusion (Train) Law, Congress jacked up the STT to six-tenths of one percent from one- half of one percent of the gross value of the shares sold.