BSP: Pos­i­tive out­look for PH’S thrift banks

Sun Star Bacolod - - Business -

THE cen­tral bank sees a bullish out­look for the coun­try’s thrift banks, a top of­fi­cial of the Bangko Sen­tral ng Pilip­inas said.

Deputy Gov­er­nor Chuchi Fonacier, dur­ing the Cham­ber of Thrift Banks’ (CTB) gen­eral mem­ber­ship meet­ing on Nov. 12, said that promis­ing growth of the bank­ing in­dus­try, sus­tained lend­ing ac­tiv­i­ties, ro­bust cap­i­tal, and sat­is­fac­tory qual­ity of as­sets show a sta­ble base for the in­dus­try.

She added that the BSP’S first Bank­ing Sec­tor Out­look Sur­vey found that out of 54 thrift banks, 75 per­cent ex­pect the coun­try’s econ­omy to grow be­tween five and seven per­cent in the next two years. It also found that 61 per­cent of thrift banks look for­ward to a strong and sta­ble bank­ing sys­tem for the next two years.

“Given these pos­i­tive sen­ti­ments, the thrift bank­ing in­dus­try has set its sights on grow­ing the busi­ness by ex­pand­ing client base, in­vest­ing in tech­nol­ogy and de­vel­op­ing new prod­ucts and ser­vices,” Fonacier said.

She added that a sec- ond area of pri­or­ity among thrift banks is the man­age­ment of risks.

“To for­tify the in­dus­try against head­winds, the in­dus­try rec­og­nizes that par­tic­u­lar at­ten­tion should be given to the fol­low­ing risks: model risk, credit risk, cy­ber­se­cu­rity risk and qual­ity of pru­den­tial re­port­ing in the next two years,” she said.

Fonacier said both the BSP and the CTB have a “strong point of con­ver­gence” when it comes to the eco­nomic out­look of the coun­try and fi­nan­cial su­per­vi­sory re­forms.

Among these points of con­ver­gence is the BSP’S su­per­vi­sory agenda, Sprint, which stands for strate­gic, pro­por­tion­ate, risk-fo­cused, in­ter­ac­tive, next gen­er­a­tion and tech­nol­o­gy­driven.

BSP aims to align its fi­nan­cial pol­icy re­forms with in­ter­na­tional stan­dards, ac­tively sup­port cap­i­tal mar­ket re­forms, and con­tinue to ad­vance fi­nan­cial in­clu­sion. It also wants to em­bed ef­fec­tive risk man­age­ment sys­tems in banks by en­hanc­ing its risk-based cap­i­tal frame­work and stan­dards for credit, liq­uid­ity and op­er­a­tional risk man­age­ment.

It also in­tends to adopt Basel III re­vi­sions to the ap­proach for credit risk and op­er­a­tional risk by 2022, and dis­cuss with the in­dus­try these amend­ments.

“As we pur­sue the adop­tion of in­ter­na­tional best prac­tice, the BSP shall be vig­or­ous and more pro­nounced in our ap­pli­ca­tion of pro­por­tion­al­ity. For in­stance, as a re­sult of in­dus­try con­sul­ta­tions, the BSP is open to ex­tend­ing the ob­ser­va­tion pe­riod of the liq­uid­ity cov­er­age ra­tio (LCR) to pro­vide thrift and ru­ral banks with more time to ad­just to the new met­rics,” Fonacier said.

The ob­ser­va­tion pe­riod for the LCR is un­til Dec. 31, 2019 for thrift banks that are sub­sidiaries of uni­ver­sal and com­mer­cial banks while stand-alone thrift banks will be sub­ject to the 20 per­cent min­i­mum liq­uid­ity ra­tio start­ing Jan. 1.

Fonacier added that the BSP will be rolling out su­per­vi­sory tech­nol­ogy projects next year, which in­clude a fi­nan­cial in­sti­tu­tion por­tal, a web-based fa­cil­ity to stream­line BSP reg­u­la­tory com­pli­ance pro­cesses; ap­pli­ca­tion pro­gram­ming in­ter­face sys­tem, which will trans­form the BSP’S reg­u­la­tory re­ports process into a flex­i­ble and stream­lined ar­chi­tec­ture; and au­to­mated com­plaint-han­dling sys­tem or chat­bot, al­low­ing fi­nan­cial con­sumers to sub­mit con­cerns via text mes­sage, Viber or web por­tal.

Newspapers in English

Newspapers from Philippines

© PressReader. All rights reserved.