The 'FPE Fund' Story: Ang Kuwento sa Kuwenta
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Transcript of The 'FPE Fund' Story: Ang Kuwento sa Kuwenta
The ‘FPE Fund’ Story
1st RAC Mindanao Meeting & Turnover The Royal Mandaya Hotel
Davao City
November 04-05, 2014
“Ang Kuwento sa Kuwenta”
Presentation Outline
• Beginnings of the Fund - Establishment of the FPE Environmental Endowment Fund
• FPE Milestones - Creation of FPE and the MOU for Fund Management
• FPE Finance Highlights - CY 1994 to FY 2013-2014 - Grants Approved - FPE Special Projects and Funds Facilitated
• Fund Valuation & Utilization
Beginnings of the Fund
US$125 Million
NRMP Grant Agreement Phase I signed on Sep 28,1990
US$25 Million max
Natural Resource Protection Component – to conserve
biological diversity & enhance sustainable natural resources
management
Jan-1992: US$5 M
1st Debt Swap which bought debt papers worth US$7.97 Million
Sep-1993: US$13 M
2nd Debt Swap which bought debt papers worth US$13.76 Million
Beginnings of the Fund Total Debt Swap +
Bank of Tokyo Donation
$21,731,745.40
119,590.15
$21,851,335.55
FPE Endowment Fund
P566,532,293.24
3,276,772.00
P569,809,083.24
FPE Endowment Fund
In US Dollars:
USAID => $21,731,745.40 ~P26.069 Bank of Tokyo => 119,590.15 ~P27.400
US$ 21,851,335.55 ~ P26.0766 In Philippine Peso:
USAID => P 566,532,293.24 Bank of Tokyo => 3,276,772.00
Php 569,809,083.24
FPE Milestones January 1992:
FPE is registered with the SEC July 1992:
The officers and members of the first regular Board of Trustees (BOT) are elected to serve for 1992-1996. Fulgencio S. Factoran becomes the first BOT Chairperson
January 1993:
Delfin J. Ganapin, Jr. becomes FPE’s first Executive Director March 1993:
A MOU among the Philippine Government (DOF & DENR), U.S. Government (USAID), and FPE for the establishment of an Environment Endowment is signed. The MOU spells out the purpose of the endowment, stipulates the conditions for the transfer to FPE, and delineates the roles of the parties concerned in safeguarding the fund.
FPE Fund Management Memorandum of Understanding dated March 05 1993:
FPE to contribute, encourage, assist, and provide technical, managerial, and financial support to NGOs, POs and communities for environment protection, natural resource conservation & management, and sustainable development Only the investment income (interest & earnings) of the endowment fund shall be used for environmental activities of NGOs and POs in the Philippines specially focused on BCSD Permissible Investments - Invest the Funds and any interest earned only in special series Central Bank bills; or in such other investments as the parties may agree to in writing Up to 20% of the investment income received in a given fiscal year may be used for administrative purposes
FPE Fund Management
APRIL 1994:
Establishment of the Endowment Fund which was placed in Central Bank special series bills
JUNE 1994:
USAID transfers the full management of the Php569.8 million or US$21.8 million Environmental Endowment Fund to FPE
Memorandum of Agreement dated May 29, 1996:
The DOF and FPE agree in writing to invest the Funds and interests thereon in such investment portfolio that will maximize earnings provided that such portfolio will have prior approval of the FPE BOT
FPE Fund Managers As of JUNE 30, 2014
20%
18%
15%10%
3%
3%
16%
9%
6%
20% AB Cap
18% RCBC
15% MBTC
10% BDO
3% BPI
3% UCPB
16% Falcon
9% LGT
6% Cr.Agrc
FPE Finance Highlights TOTAL ASSETS:
1994 => P634.2 million; 1997 => P711.4 million 2003 => P803.96 million; 2006 => P857.7 million FY2007-08 => P765.8 million; FY2009-10 => P804.8 million FY2012-13 => P855.32 M FY2013-14 => P834.85 M
FUND BALANCE:
1995 => P610.9 million 2000 => P721.7 million In 2006, the fund level of P792.6 million was on its way to breach P800M when the Global Financial Crisis struck in 2007-2008 bringing down the fund level to P712.7 million again FY2012-13 => P789.32 M FY2013-14 => P774.89 M
FPE Statement of Financial Position CY1994 to FY2013-14
0100000000200000000300000000400000000500000000600000000700000000800000000900000000
CY94 CY97 CY00 CY03 CY06 FY
09-
10
FY
12-
13
Liab Gen Fund Restricted
Statement of Financial Position Comparative Results: FY13-14 and FY12-13
ACCOUNTS FY2013-2014 FY2012-2013 Variance
Cash, A/R & Others 16,853,148 20,472,347 (3,619,199)
Fund w/ Invst. Mgrs. 806,657,304 827,096,501 (20.44M)
Property & Equip. 11,334,553 7,754,525 3.58M
TOTAL ASSETS 834,845,005 855,323,373 (20.48M)
Total Liabilities 59,952,062 66,005,460 (6.05M)
Total Fund Balance 774,892,943 789,317,913 (14.42M)
TOTAL Liab. + FB 834,845,005 855,323,373 (20.48M)
Statement of Financial Position Comparative Results: FY13-14 and FY12-13
Liab. & Fund Bal. FY2013-2014 FY2012-2013 Variance
A/Payable & Accruals 6,418,750 9,585,808 (3.17M)
Funds-held-in-Trust 3,746,425 3,191,569 554,856
Grant Liabilities 36,724,224 39,173,523 (2.45M)
Gen Grant Provision 13,062,663 14,054,560 (991,897)
Total Liabilities 59,952,062 66,005,460 (6.05M)
Restricted Fund 584,391,064 578,057,383 6.33M
General Fund 190,501,879 211,260,530 (20.76M)
Total Fund Balance 774,892,943 789,317,913 (14.42M)
TOTAL Liab. + FB 834,845,005 855,323,373 (20.48M)
FPE Statement of Comprehensive Income CY1994 to FY2013-14
0
10000000
20000000
30000000
40000000
50000000
60000000
70000000
80000000
CY94
CY96
CY98
CY00
CY02
CY04
CY06
FY08-0
9
FY10-1
1
FY12-1
3
Admin PDME Grants Revenues
Statement of Comprehensive Income Comparative Results: FY13-14 and FY12-13
FY2013-2014 FY2012-2013 % inc/(dec)
REVENUES 62,481,979 70,845,138 (11.8%)
EXPENSES (66,857,633) (66,244,411) 0.93% Other Operating and Comprehensive Incomes:
For Ex Gain 2,418,603 43.65 vs. 43.20
8,827,415 43.20 vs. 42.12
Market Valuation (17,175,911) 6,844 vs. 6,465
25,885,825 6,465 vs. 5,246
Actuarial Gains 3,302,537 -0-
Net Income (Loss) (15,830,425) 39,313,967
FPE Budget Performance FY2013-2014 (Audited)
Revenues =
P62,481,979
Grants App. 40,976,950
PDME 14,235,206
Admin 11,645,477
Total Expenditures =
P66,857,633
Excess R-E =
(P 4,375,654)
GA
62%
PDME
21%
Adm
17%
Exc
0%
FPE Budget Performance JUNE 1994 to FY2013-2014
Revenues =
P1,179,872,486
Grants App. 743,260,600
PDME 176,958,909
Admin 225,980,449
Total Expenditures =
P1,146,199,958
Excess R-E =
P 33,672,528
GA
63%
PDME
15%
Adm
19%
Exc
3%
FPE Grants Approved JUNE 1994 to FY2013-2014
Total Grants =
P743,260,600
Luzon 198,102,336
Visayas 172,374,996
Mindanao 146,261,511
National 178,977,024
EO/Insti 47,544,733
LRU
27%
VRU
23%MRU
20%
EO
6%
Nat'l
24%
FPE: Funds Facilitated / Mobilized Year Amount Amount Particulars
Aug1997 $75,000 PhP 1.709M Ford Foundation – Management of National Protected Area Sites
Nov1997 $350,000 PhP 9.224M John & Catherine MacArthur Foundation –Community Forest Program (CFP)
Jun1998 $38,557 PhP 1.177M Keidanren Nature Conservation Fund
Sep1998 $214,939 PhP 8.598M USAID-Phil. Network on Climate Change
Dec1998 $141,609 PhP 5.544M Royal Netherlands Embassy – EnDefense thru Radio Communication Network
Mar1999 $25,000 PhP 951,250 MacArthur Foundation
Jul1999 $25,000 PhP 957,499 UNDP – preparatory for BMTP
Jan-Aug 2003
PhP 525,440 Haribon, WWF-Phils., CI, DAI Eco Gov – Counterpart funds for TFCA -> PTFCF
FPE: Funds Facilitated / Mobilized Year Amount Amount Particulars
Feb&Nov2004
PhP 1.200M Philip Morris Philippines – PMI Fund for Indigenous Peoples’ projects
Feb2004 PhP 100,000 Mirant Philippines – Mt. Banahaw POs
Aug2005Jun2006
$10,044 $17,010
PhP 562,315 Php 898,835
Washington State University (WSU) for Dasol Mangrove Rehabilitation
Nov2007Feb2008
PhP 315,000 Php 360,000
UNDP thru DENR-ENR CORE for Zambales IP project (PASS)
Dec2009 PhP 227,824 UNDP – SGP Writeshop for Proj.Partners
May2010 PhP 750,000 PLDT-SMART Foundation – Punlaang Bayan for Marikina Watershed Initiative
TOTAL $897,159 PhP29,620,544 + 3,478,264 = PhP33,098,808
FPE: Special Projects Year Amount Amount Particulars
2002 to Jun2007
PhP 30,907,763 UNDP Bohol Marine Triangle Conservation Project
Oct2008-Nov2013
PhP 9,160,881 EU-AnthroWatch Project; Conso. IP Forest Corridor thru Sustainable Ancestral Domain Mgt. (CIPFC-SADM)
Mar2010-Dec2013
E647,991 P 36,929,328 EU-FUNDESO Project; Mainstreaming IP Participation in Environmental Governance (MIPPEG); Ext.-NOV2014
Sep2011-Aug2013
$1.172M P 52,942,543 USAID-FPE Project; Up scaling Forest Restoration Efforts in KBA; DEC2013
Aug2014-Jun2017
P9.11M PhP 1,287,349 UNDP GEF SGP5 Responsible Party
TOTAL P 131,227,864 SPECIAL PROJECTS
Fund Valuation & Utilization
P 569,809,065 $ 21,851,336 P 789,317,913 (Jun-2013) $ 18,271,248* P 774,892,943 (Jun-2014) $ 17,752,416**
Ref. ForEx rate: *Jun-2013 = P43.20/ $ **Jun-2014 = P43.65/ $
P 1,921,092,901 as of Jun-2014
Total Grants Approved => P 743,260,600 64.9% Total PDME Costs => 176,958,909 15.4% Total Admin Expenses => 225,980,449 19.7% P 1,146,199,958 100%
P1,179,872,486 => Cumulative Revenues from Jun-1994
Size of the Fund Original Fund Balance:
P 569,809,065 1.0
As of Dec-2001 As of JUN-2012 As of JUN-2014 Fund Bal. P719.44M 1.26 P748.87M 1.31 P774.89M 1.36 Expenses P456.46M 0.80 P 1.013B 1.78 P 1.146B 2.01
Total* P1,175,898,871 P1,762,447,373 P1,921,092,901
2.06 3.09 3.37 *Total Accumulated Value of the Fund
Statement of Comprehensive Income Comparative Results: FY13-14 and FY12-13
FY2013-2014 FY2012-2013 % inc/(dec)
REVENUES 62,481,979 70,845,138 (11.8%)
EXPENSES (66,857,633) (66,244,411) 0.93% Other Operating and Comprehensive Incomes:
For Ex Gain 2,418,603 43.65 vs. 43.20
8,827,415 43.20 vs. 42.12
Market Valuation (17,175,911) 6,844 vs. 6,465
25,885,825 6,465 vs. 5,246
Actuarial Gains 3,302,537 -0-
Net Income (Loss) (15,830,425) 39,313,967
FPE Milestones November 1989:
A Philippine Mission, led by then President Corazon “Cory” Aquino goes to the U.S. to seek further development assistance; among the government delegation is DENR Secretary Fulgencio Factoran who was joined by NGO leaders led by Maximo Kalaw and Corazon “Dinky” Soliman
September 28,1990:
The US$125 million NRMP Grant Agreement Phase 1 is signed with a Natural Resource Protection Component to conserve biological diversity & enhance sustainable natural resources management, up to a maximum of US$25 million, the facility through which the fund for the debt swap could be accessed
FPE Milestones January 1992:
FPE is registered with the SEC. The first debt swap worth US$5 million buys debt papers worth US$7.97 million at face value. The Bank of Tokyo donates US$200,000 to WWF in trust for FPE
July 1992:
The officers and members of the first regular Board of Trustees (BOT) are elected to serve for 1992-1996. Fulgencio S. Factoran becomes the first BOT Chairperson
January 1993:
Delfin J. Ganapin, Jr. becomes FPE’s first Executive Director
FPE Milestones March 1993:
A Memorandum of Understanding among the Philippine Government (DOF & DENR), U.S. Government (USAID), and FPE for the establishment of an Environment Endowment is signed. The MOU spells out the purpose of the endowment, stipulates the conditions whereby it will be transferred to FPE, and delineates the roles of the parties concerned in safeguarding the fund.
September 1993:
The second debt swap amounting to US$13 million buys debt papers worth US$13.76 million, concluding the exchange between the Philippine and U.S. governments for the establishment of FPE. The aggregate value of the two debt swaps stands at US$18 million which bought debt papers worth US$21.8 million at face value.
FPE Endowment Fund
In US Dollars:
USAID => $21,731,745.40 Bank of Tokyo => 119,590.15
US$ 21,851,335.55
In Philippine Peso:
USAID => P 566,532,293.24 Bank of Tokyo => 3,276,772.00
Php 569,809,083.24
FPE Fund Management Memorandum of Understanding dated March 05 1993:
FPE to contribute, encourage, assist, and provide technical, managerial, and financial support to NGOs, POs and communities for environment protection, natural resource conservation & management, and sustainable development Only the investment income (interest & earnings) of the endowment fund shall be used for environmental activities of NGOs and POs in the Philippines specially focused on BCSD Permissible Investments - Invest the Funds and any interest earned only in special series Central Bank bills; or in such other investments as the parties may agree to in writing Up to 20% of the investment income received in a given fiscal year may be used for administrative purposes
FPE Fund Management APRIL 1994:
Establishment of the Endowment Fund which was placed in Central Bank special series bills
JUNE 1994:
USAID transfers the full management of the US$21.8 million Environmental Endowment Fund to FPE
Memorandum of Agreement dated May 29, 1996:
The DOF and FPE agree in writing to invest the Funds and interests thereon in such investment portfolio that will maximize earnings provided that such portfolio will have prior approval of the FPE BOT
FPE Finance Highlights FUND BALANCE:
In 1995, fund balance reached P610.9 million By 2000, fund has attained P721.7 million In 2006, the fund level of P792.6 million was on its way to breach P800M when the Global Financial Crisis struck in 2007-2008 bringing down the fund level to P712.7 million again By the end of FY2012-13, fund balance stands at P789.32 million
TOTAL ASSETS:
1994 => P634.2 million; 1997 => P711.4 million 2003 => P803.96 million; 2006 => P857.7 million FY2007-08 => P765.8 million; FY2009-10 => P804.8 million FY2012-13 => P855.32 million
FPE Finance Highlights INVESTMENT REVENUES:
Highest Annual Revenues of P75.42 million in 2004, followed by P70.85 million for FY2012-13 and P70.66 million in 2003 Lowest in 2002 amounting to P40.06 million and P41.01 million in FY2008-09 at the height of the Global Financial Crisis Cumulative Revenues hit the P1.0 billion mark in Sep-2011 and amounted to P1,046,982,708 by the end of FY2011-12 Cumulative Revenues as of FY2012-13 => P1,117,827,846
BUDGET PERFORMANCE – Cumulative as of FY2012-2013: Total Grants Approved => P 702,283,649 65.1% Total PDME Costs => P 163,323,513 15.1% Total Admin Expenses => P 214,215,107 19.8% Total Disbursements => P1,079,822,269 100%
FPE Budget Performance FYJUL-2012 to JUN-2013
Revenues =
P70,845,138
Grants App. 45,759,086
PDME 11,181,016
Admin 9,304,309
Total Expenditures =
P66,244,411
Excess R-E =
P 4,600,727
GA
65%
PDME
16%
Adm
13%
Exc
6%
FPE Budget Performance with Special Projects FYJUL-2012 to JUN-2013
Revenues =
P106,590,295
Grants App. 45,759,086
Sp.Projects 37,282,228
PDME 11,181,016
Admin 9,304,309
Total Expenditures =
P103,526,639
Excess R-E =
P 3,063,656
GA
43%
PDME
10%Adm
9%
Exc
3%
SpPr
35%
FPE: Special Projects Year Amount Amount Particulars
2002 to Jun2007
PhP 30,907,763 UNDP Bohol Marine Triangle Conservation Project
Oct2008-Nov2013
PhP 6,577,273 EU-AnthroWatch Project; Consolidating IP Forest Corridor thru Sustainable Ancestral Domain Mgt. (CIPFC-SADM)
Mar2010-Dec2013
E527,961 P 33,339,883 EU-FUNDESO Project; Mainstreaming IP Participation in Environmental Governance (MIPPEG); Ext.-DEC2014
Sep2011-Aug2013
$1.120M P 47,183,897 USAID-FPE Project; Up scaling Forest Restoration Efforts in KBA; DEC2013
TOTAL P 118,008,816 SPECIAL PROJECTS
FPE: Funds Facilitated / Mobilized Year Amount Amount Particulars
Aug1997 $75,000 PhP 1.709M Ford Foundation – Management of National Protected Area Sites
Nov1997 $350,000 PhP 9.224M John & Catherine MacArthur Foundation –Community Forest Program (CFP)
Jun1998 $38,557 PhP 1.177M Keidanren Nature Conservation Fund
Sep1998 $214,939 PhP 8.598M USAID-Phil. Network on Climate Change
Dec1998 $141,609 PhP 5.544M Royal Netherlands Embassy – EnDefense thru Radio Communication Network
Mar1999 $25,000 PhP 951,250 MacArthur Foundation
Jul1999 $25,000 PhP 957,499 UNDP – preparatory for BMTP
Jan-Aug 2003
PhP 525,440 Haribon, WWF-Phils., CI, DAI Eco Gov – Counterpart funds for TFCA -> PTFCF
FPE: Funds Facilitated / Mobilized Year Amount Amount Particulars
Feb&Nov2004
PhP 1.200M Philip Morris Philippines – PMI Fund for Indigenous Peoples’ projects
Feb2004 PhP 100,000 Mirant Philippines – Mt. Banahaw POs
Aug2005Jun2006
$10,044 $17,010
PhP 562,315 Php 898,835
Washington State University (WSU) for Dasol Mangrove Rehabilitation
Nov2007Feb2008
PhP 315,000 Php 360,000
UNDP thru DENR-ENR CORE for Zambales IP project (PASS)
Dec2009 PhP 227,824 UNDP – SGP Writeshop for Proj.Partners
May2010 PhP 750,000 PLDT-SMART Foundation – Punlaang Bayan for Marikina Watershed Initiative
TOTAL $897,159 PhP29,620,544 + 3,478,264 = PhP33,098,808
Fund Valuation & Utilization
P 569,809,065 $ 21,851,336 P 748,869,516 (Jun-2012) $ 17,779,428* P 789,317,913 (Jun-2013) $ 18,271,248**
Ref. ForEx rate: *Jun-2012 = P42.12/ $ **Jun-2013 = P43.20/ $
Total Grants Approved => P 702,283,649 65% Total PDME Costs => 163,323,513 15% Total Admin Expenses => 214,215,107 20% Total Disbursements P 1,079,822,269 100%
P 1,869,140,181 as of Jun-2013
Size of the Fund Original Fund Balance:
P 569,809,065 1.0
As of Dec-2001 As of JUN-2012 As of JUN-2013 Fund Bal. P719.44M 1.26 P748.87M 1.31 P789.32M 1.39 Expenses P456.46M 0.80 P1.013B 1.78 P1.080B 1.89
Total* P1,175,898,871 P1,762,447,373 P1,869,140,181
2.06 3.09 3.28 *Total Accumulated Value of the Fund
FPE Grants Approved CY1994 to FY2012-2013
0
10000000
20000000
30000000
40000000
50000000
60000000
CY94 CY96 CY98 CY00 CY02 CY04 CY06 FY
08-09
FY
10-11
FY
12-13
LRU VRU MRU PDU/EO
FPE Investment Strategies Investment Objectives:
Responsive & tactical asset allocation for sufficient and maximized returns Inflation protection to preserve the value of the principal and/or for asset growth Sensible cash flow (liquidity) management Judicious and prudent handling of expenses
Investment Guidelines/Parameters:
Conservative; Low risk tolerance Investment horizon is long-term Restricted investments in equities; in terms of sectors to invest in and asset allocation Diversification to guard/hedge against risks
FPE Fund Management First Steps:
Establish/decide Investment Objective (endowment vs. sinking fund; risk tolerance; liquidity requirements; revenue stream vs. capital preservation ) Determine number/select fund managers (consider fund size, costs-trust/management fees, discretionary vs. advisory portfolio) Train/capacitate Investment staff re: set-up of asset/portfolio allocation, monitoring reports/worksheets (ROI, maturity schedules, asset &/or currency mix; assessment & evaluation tool for fund managers, etc.) Set meetings &/or proposal presentations with a view to establish Trust Accounts &/or Investment Management Accounts, etc. with selected fund managers