It is apparent that Maharlika Investment Corp. (MIC) has earned its money by parking the funds from Land Bank of the Philippines (LBP) and the Development Bank of the Philippines (DBP) in government securities, playing in a market backed up by the Bangko Sentral’s money printing machines.
You don’t need to be a rocket scientist to know that government securities are obligations that the Republic of the Philippines, or to be more specific, the millions of Filipino taxpayers must subsidize. You also don’t need a financial wizard to know that the Bureau of Treasury (BTr) is the cash dispenser that the national government to sop up liquidity and keep the money supply manageable.
Without these securities, most businesses would not much since the bourse is in the doldrums, and the local stock market is one of the worst performers in Asia. Such performance is not expected to improve vastly even as Middle East wealth funds consider Southeast Asian economies to become an excellent investment hub.
In his recent appearance before the Senate, MIC CEO Jose Rafael “Joel” Consing waxed ecstatic in reporting that MIC has already earned P1.5 billion without making a single investment in the country, contrary to the pledge of Malacanang and the Department of Finance (DOF) that the country’s sovereign wealth fund (SWF) would earn money immediately. Consing, known to be close to both President Ferdinand “Bongbong” Marcos Jr. and billionaire Ricky Razon, actually hasn’t earned a single red cent from MIC and his employment contract still has to materialize.
His compensation package hasn’t been assembled by Finance Secretary Ralph Recto and Malacanang. The Palace actually rushed to name Consing as the MIC CEO and the orders for MIC’s establishment were redrawn as some sleuths found that Consing and his mother were actually charged with fraud in a Cavite land case. Consing swears that he is lily white and has been cleared of any criminal liability in any pending case.
What is known is that Consing wants to be paid a salary commensurate with his work and the pay must be competitive with what banks and financial intermediaries pay their top executives. There must be generous allowances, huge expense accounts, probably even paid vacations and regular use of company jets and helicopters. In short, the pay should be more than P1-million monthly. If his monthly pay were to come close to what Norway amd other countries provides their SWF chiefs, then the ballpark figure can be between $1-million and $5-million.
Consing told the Senate that MIC will invest in the energy sector within three months. That happens to be the very sector where Razon has thrown his billions and where he intends to recoup his investments. There must be some synergy between Razon and the MIC if both of them continue to invest in the oil and gas exploration, electric distribution companies and power generation plants.
“We have already generated about P144 million in retained earnings last year, when we started placing the money in November last year. And another about P1.4 billion this year, hence total P1.5 billion in interest income,” Consing told senators. “We have about 8 memoranda of agreement (MOA), currently undertaking due diligence in 2 very important investments. Both in the energy sector. Intuitively we expect perhaps that in the next 60 to 90 days, we should be able to deploy,” he said. For a fund that will ultimately deploy billions of in energy and infrastructure, the MIC only seeks a budget of P336 million next year to cover the bill for the staff and nine board members that holds fort in Taguig.
