The perfect choice

Finally, a chairman that can truly look after the interests of SSS and GSIS pensioners.

SSS president Corazon de la Paz’s unanimous election as chairman of the Equitable PCIBank (EPCIB) board last Feb. 21 vice Ferdinand Martin Romualdez no doubt will bring stability to the bank which is badly needed moving forward.

De la Paz represents the second largest block of shares in the bank at 29 percent. The biggest single block is held by the SM Group at 34 percent. GSIS has a 12 percent share while the Romualdez family through a holding company has eight percent, which is under sequestration. With SSS-GSIS owning 43 percent, it is only fair and just that the government as a block should have the chairmanship of the bank.

Aside from her excellent credentials, De la Paz has a perfect reputation as an honest, hardworking and competent private and public official. The millions of members are assured that their interests will be protected and best served by having de la Paz guide EPCIB by her long experience in the field of finance and accountancy.

Finally, the more significant shareholder groups are in charge. After more than seven months of a minority transition chairman, shareholders of EPCIB have finally elected a chairman who really truly represents the interests of the pensioners.GSIS members are one with SSS members in congratulating de la Paz. Since 1999, when GSIS and SSS members bought substantial stakes in EPCIB, it was only this year when the combined government block had been able to successfully take the helm of the board. This is clearly a triumph which has been long been denied SSS and GSIS members. And the choice of de la Paz is clearly beneficial to the GSIS and SSS membership.De la Paz has been with EPCIB for a long time as a member of the board and is familiar with the operations of the bank as well as its objectives. She is expected to contribute positively as bank chair, which will benefit the members of both SSS and GSIS.

De la Paz, a known international expert in International Accounting Standards, can also ably guide EPCIB in handling the multifaceted challenges that these standards will present to the bank. Many banks in the Philippines face the challenges that the new IAS present. But with de la Paz at the helm, EPCIB will no doubt face the challenges presented by IAS with ease.

Sun Life makes its move

Much as I have been a believer of former Philippine National Bank president Lorenzo Tan’s supposedly "miraculous hands," I just couldn’t believe it when I read recently that Sun Life’s pre-need business has already taken the industry lead only six months after he joined the company in July 2005. That’s just too fast, I thought, for the company’s pre-need business that had been ranked 7th or 8th for the longest time.

Sun Life has emerged industry leader both in terms of Initial Cash Brought In (ICBI) and Gross Contract Price (GCP), the two most relevant benchmark sales indicators for pre-need companies in the months of Nov. and Dec.

In Dec., for instance, SLF garnered a market share of 53.1 percent in ICBI and 31.6 percent in GCP. Dislodged leader Philam followed with 9.9 percent and 14.6 percent, respectively for ICBI and GCP. Prudentialife was third in terms of initial collection with 6.9 percent, while Manulife grabbed the same spot in terms of GCP with 11.5 percent.

For the whole of 2005, Sun Life’s phenomenal performance in the last quarter of the year secured for it the third spot overall with an ICBI market share of 15.7 percent from 11.3 percent in the previous month.

The main trigger for this aggressive rise in SLF‚s pre-need business is a novel marketing campaign that used to be unheard of in the industry. This allowed SLF to grow by 498 percent and 1,170 percent in terms of GCP and ICBI respectively on a year-on-year basis. That performance is phenomenal given the industry’s average performance of – 14.47 percent and 17.88 percent for the same benchmarks during the same periods.

Sun Life’s sterling performance is not only limited to its pre-need business though. The company’s mutual funds business also grew by 81 percent in terms of sales in the whole 2005 versus its performance a year ago. SLF’s asset management subsidiary, Sun Life Asset Management Co. Inc (SLAMCI) reports mutual fund sales leapt to P2.9 billion as of end-December 2005 from P1.6 billion in 2004.

SLAMCI is presently the country’s third largest wealth management company with over P7 billion in assets under management (AUM). The company’s mutual funds portfolio growth will look all the more impressive if comparison will be made on its size at present and five years ago. From only P150 million in March 2000, SLAMCI’s assets under management have grown to P7.2 billion as of end-December 2005. The company’s highly popular Balance Fund has also been rated to have given one of the best yields among all mutual funds in the country, yielding for its customers cumulative returns of 72.2 percent over the past three years. What that means is that people who invested in a Sun Life Balanced Fund only three years ago would already have almost doubled their money with SLAMCI. Now, that surely is an excellent deal!

The company also continues to be a strong second in the life insurance business. That, despite a relatively tough market for life insurance. SLF’s Feb. performance has recorded a double-digit increase over its level in the same month of 2005.

Given all these major performance jumps, it no longer comes as a surprise how Sun Life Financial was able to top its net income figure in 2004 by a wide margin.

With Lorenzo Tan is the strategist and chairperson Esther Tan playing understanding mother to the agency force, Sun Life’s success should not come as a surprise.

Boardroom talk

Speaking of Lorenzo Tan and the companies he has handled, here’s a story that might make the so-called "miracle man" cringe. A white paper that reached me alleges that many Rotarians are being granted credit facilities by one bank upon the recommendation of its corporate banking head. What’s wrong with that? Well, such loans are being granted despite strong objections raised by internal credit officers. Lately, one such client belonging to a pawnshop clan supposedly defaulted less than three months after his loan was granted. In the end, those who drafted the white paper would just like to know if the bank president will hold this ex-US bank executive to account for this character loan.

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