Biz Buzz: FX errors

Banking regulators want to get to the bottom of not one but two incidents in recent days where the website of the Bankers Association of the Philippines showed erroneous figures in the pesodollar exchange rate.

Yesterday morning, the BAP website showed—to the shock of a lot of market watchers—that the peso hit P54.99 to the dollar. The problem was that it appeared to be an error, and the figure was promptly corrected a few minutes later to P54.09.

Last week, the same website showed the peso hitting P54.66 to a dollar in late afternoon trade, during an ongoing frenzy to sell the peso amid adverse economic news. After half an hour or so, the figure was corrected to P53.975.

These look like innocuous errors, but in a market where the peso is dropping, small mistakes like these tend to aggravate jitters among the public that’s increasingly worried about the diminishing value of their money.

Now some people in the central bank are asking tough questions. “What’s happening at the BAP?” said one. In particular, they want to know what system the bankers’ group has since it took over the trading system for the foreign exchange market from the Philippine Dealing System Holdings group earlier this year.

One central bank official wants to know if the numbers displayed on the BAP’s website —which is used by the public and the media—is automatically reflected (with a 15minute time delay) from the system used by currency traders, or is it inputted manually in the old low-tech way? Were those stray numbers the result of legitimate trades? Or so-called “fat finger” trading errors? Were they later scrubbed from the system? Is the system vulnerable to sabotage? Can it be trusted?

Answers will surely be forthcoming. Meanwhile, all we can hope is that the last two errors won’t be followed by a third one. In the world of financial markets, things tend to happen in threes, after all. And remember the adage: two may be a coincidence, but three is a trend. —DAXIM L. LUCAS

Delisting woes

The plan of City of Dreams Manila operator Melco Resorts and Entertainment (MRP) to delist from the Philippine Stock Exchange has drawn flak from some investors.

In line with the voluntary delisting plan, MRP’s controlling shareholder MCO (Philip- pines) Investments Ltd. intends to conduct a tender offer for shares held by the public at P7.25 a share. This is at a premium to the current market price but lower than previous equity deals.

“In 2013, MRP raised almost P20 billion. There was no operation yet. Shares (were) valued at P14. Now, five years later, (it’s) already starting to make money...they say it is worth only P7.25,” veteran stock broker and Eagle Equities Inc president Joseph Roxas tweeted.

In 2014, MRP had another P5.48-billion fund-raising priced at P11.30 a share.

“I think the tender offer price is too low for the income that they are showing now,” Roxas said, adding that a fair tender offer price should be closer to P10 a share.

Some stock market experts felt the tender offer price was unfair for investors who had stuck with this gaming play all these years, adding that the Philippine Stock Exchange should consider tightening the rules on delisting.

Under the existing rules, however, MRP needs to get consent from 95 percent of its shareholders to be able to go back to private hands.

If it can’t get the critical mass, it has to stay listed on the local exchange.

This exercise is seen as part of the plan to merge the gam- ing assets of MRP with that of PLC. Each of them owns half of the gaming revenues of CoD Manila. However, the delisting is being pursued even if the parties have yet to finalize the consolidation. —DORIS DUMLAOABADILLA

The next SSS chair?

It’s been seven months since former Social Security System chair Amado Valdez was fired from the state-run pension fund, and his replacement may soon be announced, possibly this month when the SSS celebrates its 61st anniversary.

Biz Buzz learned that the new SSS chair could be Aurora

Ignacio, who last year was appointed by President Duterte as “point person” of the administration’s anti- illegal drugs campaign.

There had been rumors that Ignacio, who currently holds an assistant secretary post at the Office of the President, may be the replacement of former SSS commissioner

Pompee La Viña, but a couple of sources said she’s up for the higher position. (Valdez and La Viña were terminated at the same time).

In fact, Ignacio is expected to visit the SSS offices anytime soon.

Sources said former finance secretary Gary Teves as well as ex-justice chief Vitaliano Aguirre were already out of the running for SSS chair.

Ompong-ready

Will Ignacio’s appointment be formally announced (and confirmed) during the SSS’ anniversary celebration on Sept. 21? Abangan! —BEN O. DE VERA Philippine private companies are preparing for the onslaught of Supertyphoon Mangkhut (known locally as Ompong), with the Philippine Disaster Resilience Foundation (PDRF) raising the alert status of its Emergency Operations Center (EOC)—the first of its kind in the world to be run by the private sector—to red with 24/7 hazard monitoring and risk analysis.

“We are conducting Emergency Response Preparedness actions among our eight clusters, which include power, fuel, and energy, food and nonfood, water, finance and insurance, search and rescue–medical, logistics, telecommunications, and infrastructure to prepare for the typhoon and any potential damage,” PDRF operations center director Ninoy Castro said in a statement.

Aside from monitoring the typhoon, the PDRF Emergency Operations Center has also released continuous advisories to member-companies and conducted minimum preparedness actions, coordinating with government agencies like NDRRMC and DSWD for collaborative efforts.

According to PLDT-Smart public affairs head Mon Isberto, Smart has prepositioned staff and equipment in areas that will most likely be affected by the supertyphoon while network teams outside these areas are on standby to provide assistance.

“Libreng Tawag centers will be set up where needed,” he added.

Meanwhile, the Philippine National Bank is disseminating information to all employees and branches on how to prepare for the typhoon and protect their assets.

Jollibee Group Foundation is also on standby for any relief requirements.

“Furthermore, PDRF has ensured that its cluster members are prepared to assist affected communities and augment national response efforts,” Castro said. — DAXIM L. LUCAS