PRESS DIGEST - Philippine newspapers - July 13

MANILA, July 13 (Reuters) - These are the leading stories in Manila newspapers on Monday. Reuters has not verified these stories.

- An all-out military offensive is the only way to stop kidnapping in Sulu, Governor Abdusakur Tan said, after the release of Italian Red Cross official Eugenio Vagni. (THE PHILIPPINE DAILY INQUIRER)

- The Department of Agriculture says increased spending would help the farm sector grow between 2.5-3.5 percent this year. (MANILA BULLETIN)

- President Gloria Macapagal Arroyo will meet with United States President Barack Obama at the White House on July 30 to discuss counter terrorism efforts and climate change issues, among others. (ALL PAPERS)

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BUSINESS

- The banking sector remains financially sound with most institutions' exposure to bad debts and level of capital well within comfortable levels, the Philippine central bank said. (PHILIPPINE DAILY INQUIRER, BUSINESSWORLD, THE PHILIPPINE STAR)

- Manila Electric Co (MER.PS), the country's largest power distributor, plans to create a subsidiary that will buy and sell power for distribution utilities. (THE PHILIPPINE STAR, MANILA STANDARD TODAY)

- The Philippines will likely avoid a recession this year but must be contend with slow growth through next year, New York-based think tank Gobal Source said. (PHILIPPINE DAILY INQUIRER)

($1 = 48.28 Philippine pesos)

(Reporting by Karen Lema)