BSP requires banks to report cross-border transactions
Kathleen A. Martin (The Philippine Star) - September 18, 2014 - 12:00am

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) has required banks to report on their cross-border financial transactions in order to better assess potential risks faced by the local banking sector and the domestic financial system as a whole.

“We’re basically enhancing the scope of our financial system surveillance for financial stability reasons,” BSP Deputy Governor Nestor A. Espenilla Jr. said.

The new measure mandates banks to submit a “Report on Cross-Border Financial Position,” aimed at giving the central bank an assessment of possible risks the local lenders may face in the future.

 “The Report on Cross-Border Financial Position is designed to measure and monitor the cross-border financial claims and liabilities of universal and commercial banks and their subsidiary thrift banks,” the circular said..

 “(This is) to provide the BSP with a comprehensive view of potential financial risks and transmission channels emanating from foreign counter parties of Philippine banks.”

The report includes a bank’s financial claims from and financial liabilities to non-residents and multilateral agencies. Banks will need to list the claims and liabilities according to geographic region or country, sector and currency.

The big banks will be required to submit an initial, one-time report on their cross-border financial position 120 days after Sept. 30.

After this phase, universal and commercial banks and their subsidiary thrift banks should submit a quarterly report on their cross-border financial positions to the BSP.

The BSP stressed that banks will face penalties for late and/or erroneous reports.

Specific guidelines for the mode and manner of submission of the new report, meanwhile, will be covered by a separate issuance, the central bank said.

The BSP has been continuously implementing reforms in line with its mandate of keeping a stable financial system.

Last month, BSP Governor Amando M. Tetangco Jr. pointed out the Philippine banking system itself has been a key example of financial stability and reform success following its resilience during the global financial crisis of 2008.

But Tetangco said despite efforts that have been put in place for financial stability, the central bank will remain vigilant in order to make such sustainable.

BANGKO SENTRAL BANKS BSP BUT TETANGCO CROSS-BORDER FINANCIAL POSITION DEPUTY GOVERNOR NESTOR A ESPENILLA JR. FINANCIAL GOVERNOR AMANDO M REPORT
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