BSP Governor Amando Tetangco Jr. said the introduction of personal management trust (PMT) is among the series of trust reforms being pursued by the central bank. STAR/File photo
MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) has diversified the line up of trust products offered in the market as part of efforts to promote a more responsive climate in the financial service industry.
BSP Governor Amando Tetangco Jr. said the introduction of personal management trust (PMT) is among the series of trust reforms being pursued by the central bank.
“The PMT is a welcome addition to the wide array of trust products offered in the market, and is deemed very timely considering that there is a rising prevalence of one-person household in Asia, including the Philippines,” he said.
The PMT is a living trust arrangement that seeks to meet the estate planning and asset management needs of individuals.
For a minimum amount of P100,000, an individual could open a PMT for the management and preservation of his funds or properties to answer for the current or future needs of the designated beneficiaries, including but not limited to education, retirement, and/or wealth accumulation.
The designated beneficiaries could be the trustor himself, his spouse, children or other third party beneficiaries.
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An individual is required to state his purpose for opening a PMT, as well as the distribution of his funds or assets to ensure that the PMT is consistent with the intent of the regulations.
Tetangco said the central bank is mandated to promulgate rules and regulations necessary for the development of the fiduciary business.
The PMT is expected to address the clamor of the market, especially individuals who have no capacity or those who do not see the necessity of appointing third-party beneficiaries.
The PMT is seen as a more flexible tool in the management of an individual’s financial affairs as the Living Trust Account (LTA) has a strict requirement on third-party beneficiaries.
The BSP said the LTAs would be discontinued to provide a smooth transition.
The regulator said all existing LTAs would automatically be considered as LTAs.
Total resources of the trust industry went up P8.1 billion to P2.67 trillion in end 2015. Universal banks with trust licenses cornered 82.8 percent of the market with total assets of P2.21 trillion followed by commercial banks with a share of 11.5 percent or P307.5 billion.
Investment houses accounted for 4.3 percent of the total assets of the industry with P114.1 billion while thrift banks cornered 1.4 percent or P37.7 billion.
