FAMI initiates information, investment campaign

The First Metro Asset Management Inc. (FAMI) is launching a monthly investment program for teachers and school employees to complement its existing financial literacy program.

The monthly investment program will be undertaken with the Catholic Educational Association of the Philippines (CEAP).

The program aims to provide a practical facility behind the financial literacy concepts that FAMI and CEAP advocate.

The program, which will be implemented on a voluntary basis through the mutual funds being managed by FAMI, will help the teachers and school employees save by setting aside small amounts regularly to meet major long-term financial objectives.

To spearhead the project in Luzon, CEAP appointed Region IV director, Fr. Redentor S. Corpuz to work closely with FAMI in educating the CEAP members and implementing the program for the different schools.

FAMI is a partnership between the First Metro Investment Corp. (FMIC), CEAP, and the Marist Brothers Foundation. It is also a member company of the Metrobank Group.

At present, FAMI manages three mutual funds – Save and Learn Equity Fund, Save and Learn Balanced Fund, and Save and Learn Fixed-Income Fund.

The three basic fund structures can enable investors to tailor-fit their investment portfolio to match their investment risk profile and attain their financial goals.

In a report, FAMI linked the investment information program country’s domestic savings rate, which plays a major role in economic growth.

“The ability to mobilize long-term investments not only benefits the investor but other people as well. Long-term money provides for business expansion which in turn results to higher employment rate,” FAMI said.

Unfortunately, the Philippine domestic savings rate is not as good compared to its closest neighbors.

Data from the World Bank shows that on the average the domestic savings rate in the Philippines from 1990 to 2005 is a mere 16.61 percent of its gross domestic product (GDP).

This is way below the average of other countries like Indonesia (29.64 percent), Thailand (33.59 percent), Korea (34.96 percent), and Malaysia (41.77 percent).

As if the Philippine figure is not bad enough as it is, what is worse is the fact that the average for the Philippines (from 1975 to 2000) used to be 22.

The number of investment vehicles available to the Filipino investor has grown in recent years.

While this is indeed a very positive development, these new instruments are not as easy to understand compared to the typical deposit products that Filipinos have grown accustomed to.

“That is why investment education is a critical ingredient in improving the savings rate of the Philippines,” it added.