PSE should go beyond BW reforms

I watched PSE’s hoopla of a roadshow at the Manila Pen last Monday. I noticed that all the speeches and presentations focused on BW-inspired reforms. If only I got a word in when I last talked to PSE’s Vivian Y, I would have been able to explain why John Mangun is right about the need to now pay attention to the quality of the listed issues at the exchange.

Well, good housekeeping is great. But I hope they do not forget the more substantive part, which is the quality of the issues. It is like having a brand new and modern public market with a marketmaster who means business, like Bayani Fernando, but if the goods being sold are of poor quality or of no use to the potential buyers, then what’s the use?

But I fully appreciate what Vivian Y is trying to do. It is great to know that we now have a regulatory regime and a stock market that is no longer dominated by the old boys’ club members. But if it is still selling the old issues with characteristics buyers find unattractive, the PSE will continue to remain irrelevant.

PSE’s apparently obnoxious and clueless corporate secretary, a certain Francisco Villaroman, wrote this paper asking what the point of my first column on the PSE was. Actually, he answered his own question with this sentence before his question. Villaroman wrote: "At least we can perhaps agree that the quality of our listings and liquidity could be improved, and thus put this aside." That’s the point, Mr. Villaroman, and we can’t put these aside.

For example, even an issue as good as Ayala Corporation, may not attract that much excitement with the regional fund managers because only about 10 percent of its shares are actually floating in the market. That may be okay with guys like us who just buy a few thousand here and there.

But a serious investor who may want to buy enough Ayala shares to make it worth his while will find it difficult to buy those shares from the market. In the same manner, someone with a significant block of shares will find it difficult to sell if he wants to get out quickly. There is little liquidity. You still have to go to the old boys’ group to strike a deal.

This then brings us to minority rights. Simply put, the only rights minorities in our listed companies have are the rights that the majority will concede to them. We can talk corporate governance until we are blue in the face, but in the real world of Philippine corporate boardrooms, the rights of minority shareholders may be in the statute books but good lawyers know how to get around them.

I will also be the first to agree that the SEC is now an effective and well intentioned regulator. But that’s because you have Lilia Bautista as SEC Chairman. What if an out and out politician with little interest in good governance succeeds her? Todas na naman. In other words, we are still far off from the day when we can say that reforms have taken hold and investors can depend on regulators to protect their rights.

So that even as I am glad that today’s PSE leadership has taken the first steps towards winning back investor confidence, it is my hope that they will go beyond the cosmetics. I want to see the PSE adopting rules that go against the interest or the bad habits of its member brokers.

Will they really be able to outlaw backdoor listing? Will they really be able to delist those stupid so-called tech companies that have not had any operations since their original mining operations failed? Will they be able to get the listed issues, the blue chips included, to list more than a token 10 percent of their outstanding shares in the market?

I hope and pray that Vivian Y will be able to answer yes to all these questions. I know reforms cannot be done overnight. Hell, the PSE does not even have a literate corporate secretary. The one they have does not seem to know the basics of what constitutes market reforms and, oddly enough, is proud of his ignorance. In fact, he isn’t even civilized enough to realize that it shows lack of good breeding to bear down on my mild-mannered editor just because he didn’t like what I wrote. Complain to me, you ninny!

One would have thought that a PSE official would politely and patiently deal with media if only because the PSE needs to spread the word about market reform. Come to think of it, PSE’s corporate secretary was dense enough not to realize that we were on their side on the reforms. So, I wonder if Vivian Y has the brainpower support to help her see her program through?

Pag Ibig

We published last week the response of a Pag-Ibig spokesperson to a reader complaint about Pag-Ibig’s loan restructuring program and interest rates. The reader complained that being a borrower in good standing, the Pag-Ibig branch in Ortigas Center refused to let him participate in the program and allow him to lower his interest rates.

The Pag-Ibig spokesperson, a Margie A. Jorillo, responded that the restructuring program is available to both updated or delinquent borrowers. She also wrote that "Pag-Ibig’s interest rates are not 16-17 percent as you stated in your column but nine to 14 percent, fixed for 25 years."

So I sent her response to reader Emmanuel V. Sierra, who sent this reaction to the offered explanation of Pag-Ibig’s spokesperson.

"Thanks for informing me about their reply to my complaint. Sir, before I wrote you a letter I verified it with their various Pag-Ibig offices (Ortigas branch and Makati main office). They told me specifically that there is no special interest rate reduction scheme for updated borrowers.

"The guy (sorry, I forgot the name) I talked to in Ortigas branch was even apologetic when I pointed out the flaw in the scheme. Sir, beware, she’s lying. I have document to prove that they are charging me 16 percent for my 25-year Pag-Ibig housing loan. You can countercheck it with your assistant. Maybe, I’ll go directly to their office to clarify things. Again, thank you for exposing the idiots in the government service.

"Mabuhay po kayo!"

Maybe it is a simple case of the frontliners not knowing the policies promulgated by head office. That is typical of government bureaucracies as well as bureaucracies in large private sector companies. What must be done is for Pag-Ibig to get its act together and improve their communication flow.

Good news and bad news…

This one came from reader Chito Santos.

After submitting to X-rays, ECGs, MRIs, blood tests, and a host of other diagnostics, the anxious patient waited for the doctor’s opinion.

"Well Ellie," the physician began, "I have good news and bad news."

"So, what’s the good news, already?"

"My daughter has been accepted to the Harvard School of Medicine."

"Yes, that’s wonderful! And the bad news?"

"You’re going to pay for it."

(Boo Chanco’s e-mail address is [email protected])