BSP backs amendments to bank secrecy law

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) is backing proposals to amendment the country’s bank secrecy law to strengthen supervision of bank accounts and align with international standards.

During a Senate committee on banks hearing on proposed amendments to the Secrecy of Bank Deposits Law, BSP general counsel Roberto Figueroa said that the current restrictions prevent the BSP from fully examining bank accounts, limiting its capacity to ensure financial system stability.

“The current laws on secrecy of bank deposits restrict the depth of information and records that BSP can look into,” Figueroa said, noting that only the Philippines still maintains strict bank secrecy provisions that constrain prudential oversight.

He recalled that under Presidential Decree 1792 issued in 1981, the BSP was allowed to look into or examine bank deposits when authorized by the Monetary Board, but this power was removed in 1993 with the enactment of Republic Act 7653, or the BSP Charter, which expressly repealed the earlier decree.

Figueroa said the central bank is seeking “amendments to the Secrecy of Bank Deposit Law to be limited within the confines of BSP’s banking supervision and its investigation of closed banks.”

Both the World Bank and the International Monetary Fund have also urged the Philippines to ease its bank secrecy restrictions.

Figueroa said these institutions recommended that the central bank be given “unimpaired access to all customer accounts” and the ability “to employ and share depositor information for any prudential purpose in order to fulfill its supervisory mandate.”

One of their proposed actions was to “amend the bank secrecy laws to grant BSP full access to banks’ deposits and other data.”

According to Figueroa, the BSP supports the objectives of several pending measures in the Senate that will allow the BSP, the Anti-Money Laundering Council, the Bureau of Internal Revenue, the Securities and Exchange Commission, the Insurance Commission, and the Philippine Deposit Insurance Corp. to inquire into deposits as part of their official functions.