BSP expects entry of more foreign banks

 Economy
Feb 182014
 

MANILA, Philippines – The country may see the entry of more foreign banks soon as the Bangko Sentral ng Pilipinas (BSP) readies its proposed amendments to the law that will pave the way for the liberalization of foreign banks’ entry.

BSP Governor Amando M. Tetangco Jr. told reporters yesterday the central bank is preparing the proposed amendments to RA 7721 or the law governing the entry and operations of foreign banks in the country.

“We’re looking at that and we will be presenting our proposal to Congress, which should basically entail the liberalization of foreign bank entry,” Tetangco said on the sidelines of Euromoney’s Philippines Investment Forum 2014.

The act liberalizing the entry of foreign banks in the country, approved in 1994, only allows the entry of 10 foreign banks.

Tetangco said the form of liberalization needed – whether increasing the figure or completely removing the limit – will still be assessed.

“That’s something we need to discuss but the overall thrust is to liberalize our regulations with respect to the entry of foreign banks,” Tetangco said. “There are different ways and we are looking at those possibilities now,” he added.

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The Philippines is gearing up for the Association of Southeast Asian Nations Economic Integration set to be launched by 2015. Part of this is the financial integration which will give the region’s banks a bigger market and more opportunities for growth.

Tetangco said the country needs to amend RA 7721 to allow the entry of more foreign banks.

A number of foreign banks have already expressed interest in the Philippine market, especially given its population, BSP Deputy Governor Nestor A. Espenilla Jr. said.

Local banks, meanwhile, have been raising capital and aggressively expanding in Metro Manila and in provinces in preparation for the integration of Asean banks in 2020.

BSP charter changes ‘critical’ for financial stability

 Economy
Jan 232014
 
BSP charter changes ‘critical’ for financial stability

MANILA, Philippines – Amendments to the central bank charter that would give the institution additional powers of surveillance over banks and its sister companies is “critical” for financial stability, the International Monetary Fund said. “That’s critical… that’s a very important aspect and most countries have that actually,” IMF resident representative Shanaka Jayanath Peiris told reporters. “The lesson from the global crisis was that there should be a regulator with powers to ensure financial stability, to cover and avoid regulatory gaps, and to be able to look at institutions including financial and non-financial entities,” he continued. Peiris was commenting on the Bangko Sentral ng Pilipinas’ proposed amendments to the New Central Bank Act of 1993 aimed at strengthening the institution’s monetary and financial stability mandates. The said amendment is deemed important in order to trace where bank loans go to or if these funds are being granted as fresh loans by the borrower. This will help the BSP assess the risks faced by the banks if the end-borrower does not pay the firm that originally received the loan from the bank. “From the global crisis, we learned that not knowing was the problem but also you need the power to act as well,” Peiris said. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 “So first you need to enhance the monitoring which also partly being done but you also have to have the legal mandate for it if you need to act in the future,” he added. The global financial Read More …

BSP to tighten credit card reporting system

 Economy
Aug 212013
 
BSP to tighten credit card reporting system

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) is set to issue a new report to assess the credit card situation in the country. “We are launching in the next few months a new reporting system called Credit Card Business Activity Report,” BSP Deputy Governor Nestor A. Espenilla Jr. told reporters late last week. “So all banks, all credit card providers will be required to complete this… so we have a better handle of the information,” Espenilla added. Moreover, this new report will allow the central bank to determine the number of credit cards issued and the number of cardholders in the country. “We also want to know the aging of those so we have a smoother appreciation of the credit card situation,” Espenilla said.  Aging is a tool employed by firms to estimate possible losses from uncollected receivables, in this case, from credit cards. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 The central bank already tracks credit card debt through the local banks’ report of the loans they have extended. Credit card receivables grew nine percent to P143.684 billion in the first quarter from P131.870 billion in the same period last year. The increase in credit card receivables along with growth in other consumer loans was attributed by the BSP to the favorable macroeconomic conditions enjoyed by the country and the steady inflow of remittances from abroad.