Duterte certifies as urgent financial industry resiliency bill vs Covid-19

PRESIDENT Rodrigo Duterte has certified as urgent the passage of the bill that will ensure the resiliency of the Philippine financial sector amid the coronavirus disease 20Q9 (Covid-Q9) pandemic.

In a letter to Senate President Vicente Sotto 3rd on Friday, Duterte certified as urgent Senate Bill 1849 or the proposed “Financial Institutions Strategic Transfer (FIST) Act.”

The bill recognizes the role of banks and other financial institutions as mobilizers of savings and investments and in providing the needed financial system liquidity to keep the economy afloat.

Duterte said the bill will “strengthen financial initiatives towards national economy recovery and maintain the stability of the financial sector amid the Covid-19.”

The FIST bill is currently endorsed for plenary approval in the Senate.

Sen. Mary Grace Poe, the sponsor of the bill, said last month that the proposed measure might free up PQ.Q9 trillion worth of loans from the sale of nonperforming assets to FIST corporations.

It will cover banks and other lending companies licensed by the Bangko Sentral ng Pilipinas (BSP).

“When we get to the bottom of it, this law’s primary objective is really to keep the banking sector above water during this crisis,” Poe said.

“Before the banks can help MSMEs (micro, small and medium enterprises), we must help the banks first,” she added.

According to Poe, the said bill might also help around 600,000 MSMEs and save more than 3.5 million jobs.

While the BSP gave assurances that the country’s banking system has built-in buffers, Poe said there was a limit to its risk-bearing capacity.

“The swift enactment of this law will promote investor and depositor confidence, and mitigate the effects of the crisis,” the senator said.

“Let’s stop playing catch-up with the pandemic and prepare the policy for the worse. We know what’s coming. Mabuti nang handa tayo kung sakaling kailanganin (It’s better to be prepared),” Poe added.