^

Business

Paeng, banks reach ‘gentleman’s pact’ on cap on lending rates

-
The Bankers Association of the Philippines (BAP) and the Bangko Sentral ng Pilipinas (BSP) agreed yesterday to enter into a "gentleman’s agreement" which would put a five-percentage point cap on corporate lending rate based on the yield of the 42-day cash management bills (CMBs).

This was announced yesterday by BAP president Placido Mapa and BSP Governor Rafael B. Buenaventura following a late afternoon meeting at the Manila Golf Club.

Mapa said the cap would be based on a "realistic" rate for the 42-day CMB.

The Bureau of Treasury (BTr) will sell about P3-billion worth of CMBs today through a tap facility, which is basically a negotiated sale.

The BSP assured that it will take about a week to assess the impact of the two- percentage point increase in the banks’ liquidity reserves.

The BSP, however, reserved the right to increase its rate if there is still a need to mop up excess liquidity.

Buenaventura said the BSP is urging the banks not to take advantage of the current situation to charge high rates to its borrowers.

He pointed out that most the big commercial banks have thrift bank subsidiaries which have been exempted from the liquidity reserve hike.
Stanchart to buy thrift bank
In another development, Standard Chartered Bank has expressed interest in acquiring a thrift bank following the recent approval by the Monetary Board of HSBC’s bid to acquire PCI Savings, BSP sources said yesterday.

Stanchart, however, is denying such plan. But a top BSP source confirmed Stanchart’s interest.

HSBC, Stanchart’s competitor, has been given the go signal to acquire a local thrift bank which would boost HSBC’s retail banking presence in the country. Marianne Go

vuukle comment

BANGKO SENTRAL

BANKERS ASSOCIATION OF THE PHILIPPINES

BSP

BUENAVENTURA

BUREAU OF TREASURY

GOVERNOR RAFAEL B

MANILA GOLF CLUB

MARIANNE GO

MONETARY BOARD

PLACIDO MAPA

STANCHART

  • Latest
  • Trending
Latest
Latest
abtest
Are you sure you want to log out?
X
Login

Philstar.com is one of the most vibrant, opinionated, discerning communities of readers on cyberspace. With your meaningful insights, help shape the stories that can shape the country. Sign up now!

Get Updated:

Signup for the News Round now

FORGOT PASSWORD?
SIGN IN
or sign in with