PERHAPS the guessing game on the fate of Emilio de Quiros, who was appointed in 2010 by then President Aquino as president of the Social Security System (SSS), began as early as when Davao City Mayor Rodrigo Duterte became certain of winning the presidency in the May 9 election.
As the new president, what would he do with SSS’ investments in listed companies? Will he allow the SSS to continue to accumulate shares that would entitle it to elect a nominee to the boards of listed companies?
More importantly, will President Duterte retain SSS’ present management led by De Quiros, who, like Carlos Dominguez, his choice to head the Department of Finance, is also a former executive of the Ayala group of companies owned by the Zobel family?
Again, as in the past, Due Diligencer won’t dare a guess. It is up to the public to judge for themselves if De Quiros and other Aquino appointees to the Social Security Commission deserve to remain in their posts.
To give the public an idea of how much SSS has invested in listed stocks, Due Diligencer reviewed various filings of two listed companies.
In Union Bank of the Philippines (UBP), SSS owns 115.13 million common shares, or 10.9 percent. At UBP’s 52-week high of P68 per share, its holdings had a market value of P7.8 billion. The stock closed on Wednesday at P64.80, giving SSS a paper wealth of P7.46 billion.
As SSS president, De Quiros has been representing SSS on UBP’s 15-person board since Oct. 1, 2010. As a director, he is entitled to compensation, which he reportedly turns over to SSS coffers. It is not known how much he gives up of his pay and perks to help boost SSS funds.
In its compensation filing, UBP provides the public only with the compensation of its five highest-paid executives as a group and of “all other officers and directors as a group unnamed.” In this case, the individual investors and SSS members do not know how much UBP has been paying De Quiros along with the bank’s 12 other directors. As UBP executives, two directors do not receive the same compensation as non-executive directors.
For the information of the public, they can find the compensation data that UBP reported in Note 33.8 of the 2015 financial statements audited by Punongbayan and Araullo. Here is what the note said about the bank’s board compensation:
“Directors’ fees incurred by the group amounted to P54,731 in 2015, P40,174 in 2014 and P33,046 in 2013, and by the parent bank amounted to P49,896 in 2015, P37,096 in 2014 and P30,489 in 2013 and are included as part of Salaries and Employee Benefits account in the statements of income.”
As parent company only, UBP paid 13 directors P117.48 million, or P9.04 million each, which is not bad for a three-year directorship.
Did De Quiros give up all of his pay and perks from 2013 to 2015? Your guess is as good as mine.
13 directors only
In a footnote to the compensation filing, UBP explained why it pays only 13 of the 15 members of the board:
“The non-executive directors receive only per diems of P120,000 for each attendance in meetings of the board and P60,000 for committee meetings, while the executive directors, chairman of the board who is also its chief executive officer, and president who is also the chief operating officer receive P3,000 and P1,500, respectively, for each attendance in board meetings and P3,000 for committee meetings. The chairman of each committee is paid a per diem of P80,000 per meeting actually attended.
“The executive officers receive salaries, bonuses, and other standard bank benefits that are already included in the amounts stated above. There is no contract covering their employment.
“Per diem and bonuses of some directors who represent institutional shareholders are received for and on behalf of their institution.”
The bank did not say if De Quiros as SSS nominee is covered by the “per diem” footnote.
P1.24M from Belle
Belle Corp. listed SSS in a filing as owner of 370.47 million common shares, or 3.5 percent. At the stock’s 52-week high of P3.81, SSS had a paper wealth of P1.41 billion.
De Quiros is the SSS nominee to Belle’s 11-person board. As a director since Sept. 21, 2010, he is also entitled to compensation as he is in Union Bank. Belle said it paid each director P1.24 million in 2015.
Belle disclosed in a filing the compensation it paid “all other officers and directors as a group unnamed” as follows: P20.84 million in salary and P1.74 million in bonuses in 2014; P23.76 million and P1.98 million in 2015; and an estimated P25.19 million and P2.1 million in 2016.
Belle belongs to the SM Group owned by businessman Henry Sy Sr. and his family. Its stockholders include Belleshares Holdings Inc., 2.6 billion shares, or 24.8 percent; Sysmart Corp., 1.72 billion shares, or 15.5 percent; and SM Development Corp., 695.1 million shares, or 6.62 percent.
Finally, here is Due Diligencer’s take on De Quiros: His fate remains to be decided by the Duterte administration.