First Philippine Holdings Corporation

July 6, 1998 PSE CIRCULAR FOR BROKERS NO. 1536-98 SUBJECT : First Philippine Holdings Corporation First Philippine Holdings Corporation ("FPH") confirmed to the Exchange, in a letter dated July 3, 1998, the accuracy of the contents of the attached news article published in the June 30, 1998 issue of the Manila Times which reported that JP Morgan Group and AIG Group are the subscribers to the US$90-million convertible notes to be issued by FPH. FPH in said letter explained that: ". . . The news article was probably lifted from our filing with the Securities and Exchange Commission of a request for clarification which we attach. . . . We had earlier provided the PSE with a copy of our June 15, 1998 filing with the SEC regarding the issuance of the US$90 million by FPHC but at the time only Benpres Holdings Corporation was identified as the investor." For your information. (SGD.) REYNOLD P. ONG Vice-President, Listings and Disclosures Group FPHC bares subscribers to IOU notes J.P. MORGAN Group and AIG Group are subscribing to the $90 million convertible notes to be issued by First Philippine Holdings Corp. (FPHC). In announcing the subscribers to FPHC"s convertible notes, FPHC corporate secretary Enrique I. Quiason also said the company has filed a petition with the Securities and Exchange Commission for exemption from registration of the underlying shares needed in the event of conversion of the IOUs into common shares. Quiason said the general stability in the financial markets has provided the company with an opportunity to raise capital through a private placement of a convertible instrument. FPHC earlier deferred the issuance of $200 million worth of euroconvertible notes and the reservation of the underlying common shares because of volatile market conditions during the last half of 1997. cdlex Quiason said the convertible notes, which FPHC plans to issue, will be offered outside the Philippines by a corporation organized in the Cayman Islands. Zinnia B. dela Pea June 26, 1998 The Securities and Exchange Commission SEC Building E. de los Santos Mandaluyong City Attention: Ms . Linda Daoang Director Money Market Operations Department Gentlemen : We refer to SEC MMOD Resolution No. 029 Series of 1998 dated June 19, 1998 granting First Philippine Holdings Corporation's request that the issuance of (i) up to US$ 90,000,000 Convertible Notes ("Notes") in a private placement outside the Philippines to the J.P. Morgan Group and AIG Group and to Benpres Holdings Corporation and (ii) the underlying common shares for future conversion of the Notes be exempted from the registration requirements of the Revised Securities Act, Batas Pambansa Blg. 178. In connection with the said resolution, we seek your confirmation that the offering of the Notes are subject to the exemption from the registration which you granted because (i) the Notes that will be issued within the Philippines to Benpres Holdings Corporation and to Philippine American Life Insurance Company ("Philamlife") are being privately placed and (ii) the Notes that will be issued to the JP Morgan Group and the AIG Group are privately placed and also being offered outside the Philippines. We have been informed that Philamlife is a wholly-owned subsidiary of AIG: We also seek your confirmation that the underlying common shares that will be reserved for issuance of the Notes in the event of conversion of Noteholders are likewise exempted from the registration requirements of the Revised Securities Act, Batas Pambansa Blg. 178. cdlex We thank you again for your kind consideration. Very truly yours, (SGD.) ENRIQUE I. QUIASON