Philippine central bank seeks broad changes to its charter

Will ensure stability of the economy and the financial system.

The Bangko Sentral ng Pilipinas recently submitted to both houses of the Philippine Congress a new set of proposed amendments to its 30-year-old charter. The BSP wants 19 amendments in 30 sections of its charter. The amendments seek to improve the BSP’s own financial situation and asks for the restoration of some powers the central bank lost when it was reorganized to replace the old Central Bank of the Philippines in 1993.

Among the powers the BSP wants restored are immunity from suits for all BSP personnel acting in good faith and exemptions from restrictions under deposit secrecy laws.

One of the key amendments include a proposal to increase the BSP’s capitalization by P150 billion, payable in three years if the bill is passed into law. This will be on top of the BSP’s existing maximum allowed capitalization of P50 billion, of which P40 billion is paid up. BSP said the increase will enhance its administrative and fiscal autonomy. It will also remove the threat of bankruptcy.

BSP incurred a net loss of P95.38 billion in 2012, nearly triple the P33.69 billion recorded the previous year. In 2010, the central bank registered a net loss of P59.04 billion.