Fund Coordinators Club Meeting
Ladies and gentlemen, good morning.
One part of my job as President and CEO of the Pag-IBIG Fund that I most look forward to is attending the meetings of our different Fund Coordinators clubs around the country. This is because it gives me a chance to meet face to face with some of our most valued partners and stakeholders. I am, of course, referring to you, our Fund Coordinators.
Also, it is a welcome experience talk about the Fund’s performance because, for the past six years, we’ve had nothing but good things to report. We have managed not only to maintain but to improve on the Fund’s robust growth and record breaking performances year after year.
Today, I am happy to report that 2006 has been yet another very good year for the Fund.
TOTAL ASSETS
The Fund delivered yet another solid financial performance for the year. Our total assets for 2006 reached P191.55 billion. That’s an increase of 7.43% over our 2005 assets. This brings us even closer to the P200 billion mark, only six years after the Fund’s assets went up to P100 billion in its first decade of existence.
MEMBERSHIP LEVEL
We ended 2006 with an active membership base of 6.5 million. The bulk of our members are private sector employees who make up 70% of the total, with 4.56 million individual members. Government employees make up a quarter at 1.63 million, and the rest are OFWs, self-employed individuals, cooperatives and other types of members.
SHORT TERM LOANS
One particular area where the Fund really shone last year is our Short Term Loan programs. We released a total of P25.68 billion worth of multipurpose loans and calamity loans to help address the urgent financial needs of 1.7 million members. That’s an increase of 100 percent over our STLs in 2005.
Also very significant is the fact that Pag-IBIG is not the only government financial institution that lends calamity loans to its members. The SSS and GSIS no longer offer such loans. With the numerous calamities last year, our calamity loans for the year actually surged by 258 percent, with P4.55 billion in total loans to close to 300,000 members. So now, Pag-IBIG is not only the main shelter financing institution in the country, but also the biggest calamity loans provider.
HOUSING LOANS
And speaking of shelter financing, the Fund also improved its record in this area too, with more than P16 billion released in enduser housing loans. This amount funded the construction or purchase of 32,939 housing units for 33,038 members.
MORTGAGE FINANCING
The Pag-IBIG Fund remains as the biggest financier of housing loans in the country today accounting for nearly 37 percent of the total mortgage financing as of 2005, with a total of P101.8 billion in housing loans. In comparison, the combined takeouts of all the other government agencies with shelter financing programs amounted only to P61 billion. The banks combined for a total of P114.7 billion in mortgage financing, but that’s all the banks combined. Not one institution came even close half of what we have funded.
PROVIDENT CLAIMS
On the provident benefits front, we released over P4 billion to 127,538 members who have either retired or opted to withdraw their savings.
Among those who were able to claim their savings were OFW members under our Pag-IBIG Overseas Program who had to be repatriated due to the eruption of hostilities in Lebanon last year. Our Board Chairman, Vice President Noli “Kabayan” De Castro instructed the release of their provident savings to help ease the financial hardship brought on by their job displacement.
NET INCOME
The Fund once again broke its record by posting its highest income last year. We were able to generate P7.7 billion, a 4.05% increase over our previous record setting income in 2005.
With this achievement, the Fund’s annual net income growth has hit its sixth straight year, making it one of the most profitable Philippine corporations. In 2005, we were the eighth biggest corporation in terms of net income.
DIVIDENDS
Our unprecedented financial growth has translated to greater benefits to our members, particularly through higher dividends added to their provident savings. In 2005, we were able to declare P5.54 billion in dividends, which was then the biggest in the Fund’s history. We are about to break this record as well, as we are proposing dividends of P6.2 billion.
COLLECTIONS
A major factor in Pag-IBIG Fund’s impressive growth is the constant improvement in our collections. Our sustained collection and marketing drive, combined with our tieups with banks such as the Union Bank for the use of their electronic payment system, resulted in marked increases in our total collections for 2006. Out total collections reached P56.8 billion for the year. That’s an increase of almost 20% in our total collections.
AWARDWINNING APAT CAMPAIGN
The Fund’s remarkable performance record, our achievements last year also included various awards and recognitions which served as the highlights to a great year.
As you may have heard, the Pag-IBIG Fund’s “Tapat sa Pag-IBIG” advertising campaign was honored with an Anvil award of merit last year, which is the second Anvil award we have received for that campaign.
Before the year ended, we earned yet another recognition for this—a bronze award in the 2006 Araw Values Advertising Award. We were given the award in the multimedia campaign category for promoting respect for law and authority as well as the cornerstone value of selfdiscipline. This was awarded by the Advertising Board of the Philippines last December 11 at the Carlos P. Romulo Auditorium of the RCBC Plaza in Makati.
ENERCON
The prudent management of the Fund was underscored by our thorough compliance with the government’s Energy Conservation Program, or Enercon. In fact we got a five star rating for the Enercon measures that we have implemented in all our offices nationwide.
TRIPLE A
And speaking of ratings, we are still the highest rated government agency in terms of creditworthiness. Our Aaa- corporate Rating granted by Philratings Inc., the premier rating agency in the country, recognizes Pag-IBIG’s performance as a consistently profitable company, with a well-managed investment portfolio and with a highly assured liquidity to meet all of its obligations to members and conditions alike.
TAX PAYMENTS
Of course, aside from being one of the most stable corporations in the country, Pag-IBIG is also one of the biggest taxpayers. As one of the few remaining taxpaying GFIs, the Fund paid P1.96 billion in taxes to the national government during for 2006. From 2001 to 2006, we paid a total of P10.99 billion in taxes.
SCROLL OF HONOUR
The biggest recognition we received last year, and the most prestigous in the Fund’s history, is the United Nations Scroll of Honour Award, which was given to us on October 4, 2006 in Kazan, Russia as part of the celebration of World Habitat Day.
The United Nations Human Settlements Programme, or UNHabitat, named Pag-IBIG as one of the winners for its contribution to the global campaign for human settlements.
REVISED HL INTEREST RATES
This year we expect to hit new highs, especially in our housing loan program, with the introduction of our new guidelines. We not only have the lowest interest rates in the market, we have actually made housing loans affordable to a segment of the market that probably have never considered themselves capable of buying a home, until now.
Upon the direction of our chairman, Vice President Noli De Castro, the Pag-IBIG Fund management studied the feasibility of further lowering the interest rates for our most affordable housing loan packages. Last December our Board of Trustees approved the new housing loan guidelines with the new interest rates.
For loan packages up to P300,000 we have brought down the interest rate from 9% to only 6%. For loans exceeding P300,000 up to P500,000 we have lowered the interest rate from 10% to only 7%.
For loans over P500,000 to P1 million, the old interest rate of 11% has been decreased to 10.5%. Over P1 million up to the maximum of P2 million, the interest rate has been reduced from 12% to 11.5%.
The maximum payment period has also been increased to 30 years. These changes effectively lower the monthly amortizations so that even minimum wage earners and government employees in the lower salary grades can afford our housing loans.
For a housing loan of P300,000, for instance, the monthly amortization is only P1,798. For a P500,000 housing loan, our borrowers would only have to pay P3,326.
Pag-IBIG HOUSING BONDS
Out quest to constantly improve our performance and serve more Filipinos continues.
Last week we floated our P2 billion PagIBIG Housing bonds issue, following our successful bond flotations on 2000, 2001 and 2005. This is to raise additional funds for the Fund’s housing program, as well as to refinance our maturing obligations.
The Housing Bonds were issued at par, with a term of up to five years from issue date. The coupon rate is a fixed interest rate based on the prevailing market rate at the time of issuance. The bonds are tax exempt and secured by an HGC guaranty up to the amount of Principal and Interest.
Of course, we will still have the raffle draws, where eligible bondholders may win a house and lot worth up to P1 million. We will give away at least two housing units during our annual raffle draws.
CLOSING
Ladies and gentlemen, as our Fund Coordinators, you are very much a part of Pag-IBIG’s consistently impressive performance. But this is just the beginning. There is so much more that we can do, greater heights that we can reach. With your continued support and help, I am sure that this year will be ever better than the last.
Thank you very much.
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