MACROECONOMICS WEEKLY UPDATE

he BSP hiked the benchmark interest rate by 25 bps, in line with expectations, and signaled a likely pause at its next meeting in May. This brought the rate on the overnight reverse repurchase facility to 6.25%. Meanwhile, the rates on the overnight deposit and lending facilities were also raised by 25 bps to 5.75% and 6.75%, respectively. According to BSP Chief Medalla, the Monetary Board may no longer raise borrowing costs at its May 18 meeting if March inflation turns out better-than-expected and slows down from 8.6% in February. In addition, the BSP trimmed its inflation projections to 6% (from 6.1%) and 2.9% (from 3.1%) for 2023 and 2024, respectively.

The Philippines balance of payments (BoP) position widened to an USD895 mln deficit in February, amid foreign loan payments and a wider trade gap. This has been the largest deficit in the past five months and is also higher than the USD157 mln shortfall reported a year ago. This was also a reversal from the USD3.08 bn surplus in January, which reflected the government’s USD3 bn global bond issuance. The Bangko Sentral ng Pilipinas (BSP) lowered its BoP projections last week to a deficit of USD1.6 bn for 2023, equivalent to -0.4% of GDP. This was lower than the previous projection of a USD5.4 bn gap (-1.3% of GDP) in December.

INDUSTRY UPDATE

HOTELS & GAMING

In separate disclosures, Bloomberry Resorts (BLOOM) and PH Resorts Group (PHR) confirmed the termination of a term sheet proposing BLOOM’s investment in projects of PHR’s subsidiary companies. BLOOM previously signed a term sheet in May last year, with plans at the time to invest in PHR’s Emerald Bay and Clark integrated resorts projects. BLOOM said that this decision was made after considering the results of due diligence on the target companies and the projects. Meanwhile, PHR said that it is open to reentering into discussions with other parties that had previously been put on hold due to BLOOM’s planned investment.

PROPERTY & CONSTRUCTION 

In a stock market disclosure, Keppel Philippines Properties, Inc. (KPPI) announced that it will be selling its 40% stake in the entity behind the Podium Complex to Banco De Oro (BDO). Meanwhile, in a separate disclosure, BDO said it will consolidate its ownership of the Podium Complex, which consists of the bank’s Corporate Center Ortigas, the West Tower, and the Podium Mall, with the acquisition. The shares to be sold total 254.31Mil common shares— equivalent to 50% of the outstanding capital stock of SM Keppel Land. According to BDO, the price per share will be determined by the adjusted net asset value of SM Keppel Land at the deal’s closing and the net of agreed adjustments. This transaction is subject to regulatory approvals

MINING

Semirara Mining and Power Corp. (SCC) announced during a special meeting that its board has approved a regular cash dividend of Php1.80/sh and a special cash dividend of Php1.70/sh or a total dividend of Php3.50/sh. This is 133% higher compared to the Php1.50/sh declared during the same period last year. Ex-date of the dividend is no April 5, 2023, while payment is on April 25. The cash dividend translates to a dividend yield of 11.3% at the most recent market close.

ENERGY

Metro Pacific Investments (MPI) disclosed that it will acquire a 16% stake in SP New Energy (SPNEC) for Php2 bn (1.6 bn shares at Php1.25/sh). The transaction price represents a 25.6% discount to SPNEC’s market price as of yesterday’s close. This acquisition also provides MPI chairmanship of the board, with Manny V. Pangilinan taking over. A separate agreement is in the works, which grants MPI the option to increase its interest in SPNEC to 43%.

  Philippine Stock Exchange