BSP mulls lowering of investment management account threshold
Lawrence Agcaoili (The Philippine Star) - July 14, 2020 - 12:00am

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) plans to lower the minimum size of each investment management account to widen the country’s investor base as part of its financial inclusion push, according to BSP Deputy Governor Chuchi Fonacier.

Fonacier said the BSP may lower the minimum amount that should be maintained by a client to not lower than P100,000 from the current threshold of not lower than P1 million.

“The lowering of the minimum size of each investment account will enable the industry to tap a wider base of investors. The BSP believes that this will significantly contribute to the growth of the industry,” Fonacier told The STAR.

Under the Manual of Regulations of Banks and Manual of Regulations for non-bank financial institutions, the minimum size of each investment management account should not be less than P1 million.

Under the proposal, BSP-supervised financial institutions may set the minimum amount that should be maintained by a client in an investment management account at any given time provided that the amount should not fall below P100,000 except in cases where the reduction is due to investment losses.

The BSP is now seeking comments from the industry on the planned amendments to the regulations on investment management accounts.

Fonacier said the proposal also supports the financial inclusion advocacy of the BSP.

Under the proposed changes, investment management accounts may be commingled provided that the funds will only be invested in securities directly issued by the national government or securities registered with the Securities and Exchange Commission (SEC).

Likewise, the participation of each commingled accounts should be at least P100,000 instead of not less than P1 million. The number of commingled investment management accounts should also not exceed 19.

The BSP continues to formulate a trust business model initiative to promote an enabling regulatory environment in support of the growth of the trust and investment management industries while upholding the effective governance, accountability, and integrity of the trust business.

Following the forthcoming full implementation of Republic Act 9505 or the Personal Equity and Retirement Account (PERA) Law, the BSP is also reviewing existing regulations in order to make trust products and services more financially inclusive.

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