The worthy successor
ON THE NIGHT of May 8, it was finally revealed who the next governor of the Bangko Sentral ng Pilipinas ( BSP) would be — one of the most crucial decisions that President Rodrigo R. Duterte had to make. “President Rodrigo Duterte announced today the appointment of Nestor A. Espenilla, Jr. as the successor of Amando Tetangco, Jr. as Bangko Sentral ng Pilipinas Governor,” said Ernesto C. Abella, the presidential spokesperson, in a video uploaded to the YouTube channel of the Malacañan Palace.
Mr. Espenilla will take office soon after July 2, the day Mr. Tetangco’s 12-year stint as central bank governor will officially end. Mr. Tetangco was appointed as governor by former President Gloria Macapagal-Arroyo in 2005 and reappointed by former President Benigno S. C. Aquino III in 2011. He has earned praise for his superb stewardship of BSP, which has helped the Philippine economy grow impressively fast and remain robust amidst the financial disasters from which many nations, developed and developing, have suffered gravely.
The appointment of Mr. Espenilla as his successor was met with widespread approval and enthusiasm. Carlos G. Dominguez III, secretary of Finance, was quoted in a BusinessWorld report as saying of the new governor, “a very wise choice after a thorough evaluation of the future needs of the country and of all the candidates.” The response from the business community was virtually positive.
Mr. Tetangco himself is pleased. “We thank the President for his decision. The choice of an insider in the person of Deputy Governor Espenilla ensures the continuity of policy and thought process in the BSP,” he was quoted as saying in a text message to reporters.
“DG Espenilla is well respected in the banking community and highly regarded by other central banks and financial regulators both here and abroad. He is also well supported by the BSP family. I am confident that with him at the helm, the BSP will continue to be a pillar of support to the economy, that should remain among the top performing economies in the world.” Mr. Espenilla graduated cum laude with a bachelor’s degree in business economics from the University of the Philippines. He has two master’s degrees — an MBA from University of the Philippines and an MS in policy science from the Graduate Institute of Policy Science in Tokyo, Japan.
He has spent his entire career at the central bank, starting as an external debt analyst in 1981 and steadily working his way up through the ranks. In 2005, he was named deputy governor of the Supervision and Examination Sector, which oversees banks and other fi nancial institutions under the jurisdiction of BSP.
A BusinessWorld report noted that it was on Mr. Espenilla’s watch that the central bank adopted tighter regulatory standards under the international Basel 3 framework and that one of his current initiatives is the rollout of the National Retail Payment System ( NRPS).
“One could say that Espenilla has served as co- pilot of Governor Tetangco as he helped the country navigate to the different financial crisis faced by the country and the region,” Mr. Abella said. “Having been with the BSP for 36 years, Espenilla has all the right tools and experience to take on the governorship post.”
Addressing the attendees of a cocktail reception by Bankers Association of the Philippines, which consists of 40 local and foreign banks, last June 20 in Makati City, Mr. Espenilla said, “Governor Tetangco, my mentor, is leaving a legacy of excellence. He is instrumental in transforming the Philippines from being the economic laggard in Asia to one of the region’s best performing economies. Working closely with him is indeed an honor.”
He continued, “While I am delighted to succeed him, I know I have very big shoes to fill. The standard is set so high. So I intend to work hard, and with your support, we shall continue what Governor Tetangco has started.”
He made a number of promises at the event, including the movement toward a more market- based execution of monetary policy; constant review of existing tools and policies to make the monetary system more efficient and market- oriented; pursuit of capital market reforms to provide a viable alternative source of fi nancing for long-term investments; and liberalization of the provision of financial products and services to achieve a more risk- based, transparent and market- determined policy framework.
He also noted that under his governorship, the central bank would continue to reshape the financial system to make it more responsive to the needs of the domestic economy. “This would entail providing for efficient retail payments under the NRPS project and an enabling regulatory environment for fi nancial technology and for digital fi nance to develop without sacrificing prudent credit underwriting and information security standards. This would also entai l strengthening our commitment to advance our fi nancial inclusion and consumer protection agenda to ensure that no one is left behind. This is the hallmark of a truly inclusive, strong and dynamic fi nancial system,” he said. —
“While I am delighted to succeed him, I know I have very big shoes to fill. The standard is set so high. So I intend to work hard, and with your support, we shall continue what Governor Tetangco has started.” Nestor A. Espenilla, Jr. New BSP Governor