S&P raises outlook for RP banks

S&P raises outlook for RP banks

MANILA: Banks in the Philippines now earn more, are better
managed, and seeing their asset quality improve six years after
the Asian crisis, Standard and Poor's (S&P) said on Friday,
raising its outlook for the sector to stable from negative.

"The change acknowledges the stabilizing of the banking sector
in terms of asset quality that is evident from the tapering
growth rates in non-performing assets" as well as improved
profits, the U.S.-based credit rating outfit said in a statement.

Owing to low interest rates, the banks are better able to
manage their funding costs as well as carrying costs for the
soured loans, it said.

"This is in contrast to a period of aggressive loan growth
prior to the 1997 Asian financial crisis and weak risk management
practices that led to a deterioration in commercial banks' asset
quality."

S&P credit analyst Sim Wee Kiat however said the level of non-
performing loans remained high by international standards, and
the system "still faces some challenges, as reflected by the high
industry risks in the country, compared with other developed
banking markets." --AFP

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MoneyMatter-Japan-economy
Japan's indicator points to recovery
JP/16/Japan

Japan's indicator points to recovery

TOKYO: Japan's forward-looking index of economic activity
stood at 77.8 points in July, suggesting the economy will remain
on track to recovery, the Cabinet Office said on Friday.

With the latest data, the leading index has stayed above the
50-point mark, regarded as the dividing line between growth and
contraction, for three straight months.

The index for June was revised down to 75.0 points from 80.0
points.

Japan's leading index is based on a series of financial
figures such as commodity indices, new car registrations and the
number of new home building projects.

The coincident index measuring the current state of the
economy also came in at 77.8 points in July.

The June coincident index was revised down to 63.6 points from
66.7 points.--AFP

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MoneyMatter-UN-rice
UN to buy Vietnam rice for Iraq
JP/16/Rice

UN to buy Vietnam rice for Iraq

HANOI: The United Nations has agreed to buy 60,000 tons of
Vietnamese rice to export to Iraq under the "oil- for-food"
program, according to the Ministry of Agriculture and
Development.

The delivery will be made in September, a ministry official
said.

In May, the UN. allowed Vietnam to resume exports of rise to
Iraq under the "oil-for-food" program, which was disrupted by the
war.

Iraq was the biggest importer of Vietnamese rice in 2002,
taking 800,000 tons or more than 27 percent of the country's
total exports.

In the first eight months of this year, Vietnam exported more
than 2.9 million tons of rice, an increase of 23.5 percent
compared with the same period last year thanks to a massive
increase in demand from African countries.

Vietnam is the world's third largest rice exporter after
Thailand and India, with 2002 shipments totaling 3.2 million
tons.--AFP

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MoneyMatter-Thailand-bond
Thailand to issue up to $735m in bonds
JP/16/bond

Thailand to issue up to $735m in bonds

BANGKOK: Thailand plans to issue 20 to 30 billion baht (490 to
US$735 million) in bonds from the Financial Institution
Development Fund (FIDF) to non-residents within the next two
months, a report said on Friday.

The Ministry of Finance will offer the bonds at special prices
and not levy a withholding tax as an incentive to attract more
investors, according to the Business Day newspaper.

Thai Finance Minister Suchart Chaovisit has submitted the plan
to Prime Minister Thaksin Shinawatra, the daily said citing Olarn
Chaipravat, an adviser to Suchart.

The bond issue is part of the ministry's plan to issue about
200 billion baht in bonds by next year, he said.

Olarn said the bond plan was proposed on Wednesday during a
meeting among officials from the Asia-Pacific Economic
Cooperation forum in Phuket, with the aim of disseminating
information on Thai bond conditions.

The government said during the meeting that there will be
withholding tax exemptions for non-residents who buy the new
bonds, Olarn told the daily.

He said many foreigners previously found it difficult to
invest in Thailand due to foreign exchange control mechanisms and
other regulations--AFP