The Philippine Financial System PDF

THE PHILIPPINE FINANCIAL SYSTEM BY: LOUIECILLE LARCIA-BASAS, MPA, AFP OBJECTIVES:  To Learn the financial system of the Philippines  To know the different Financial Institutions operating in the country  To know about the Banko Sentral ng Pilipinas as the monetary authority and primary financ...

THE PHILIPPINE FINANCIAL SYSTEM BY: LOUIECILLE LARCIA-BASAS, MPA, AFP OBJECTIVES:  To Learn the financial system of the Philippines  To know the different Financial Institutions operating in the country  To know about the Banko Sentral ng Pilipinas as the monetary authority and primary financial system of the country. THE FINANCIAL SYSTEM OF THE PHILIPPINES  Serves as the catalyst of the country’s growth and development.  The custodian of the Philippines’ liquid reserves and based essentially on public trust and confidence.  FINANCIAL INSTITUTIONS IN THE PHILIPPINES: BANKS  Banks in the Philippines have 2 Major Roles: 1. As Participants particularly in the money creation process 2. As intermediaries in the Saving- Investment process THE BANKO SENTRAL NG PILIPINAS (BSP)  The Bangko Sentral ng Pilipinas (BSP) was created by the Republic Act No. 7653, otherwise known as the New Central Bank Act of 1993.  The Philippines’ central monetary authority that provides policy directions in the areas of money, banking and credit. THE BANKO SENTRAL NG PILIPINAS (BSP)  OBJECTIVES: to maintain price stability conducive to a balanced and sustainable economic growth. The BSP also aims to promote and preserve monetary stability and the convertibility of the national currency. http://www.bsp.gov.ph/about/functions.asp THE BANKO SENTRAL NG PILIPINAS (BSP)  RESPONSIBILITIES: provides policy directions in the areas of money, banking and credit supervises operations of banks and exercises regulatory powers over non-bank financial institutions with quasi-banking functions. http://www.bsp.gov.ph/about/functions.asp THE BANKO SENTRAL NG PILIPINAS (BSP)  FUNCTIONS: Under the New Central Bank Act, the BSP performs the following functions, all of which relate to its status as the Republic’s central monetary authority.  Liquidity Management  Currency issue  Lender of last resort  Financial Supervision http://www.bsp.gov.ph/about/functions.asp THE BANKO SENTRAL NG PILIPINAS (BSP)  FUNCTIONS: Under the New Central Bank Act, the BSP performs the following functions, all of which relate to its status as the Republic’s central monetary authority.  Management of foreign currency reserves Determination of exchange rate policy Other activities  http://www.bsp.gov.ph/about/functions.asp THE BANKO SENTRAL NG PILIPINAS (BSP)  ORGANIZATION: http://www.bsp.gov.ph/about/org.asp THE BANKO SENTRAL NG PILIPINAS (BSP)  ORGANIZATION: MONETARY BOARD exercises the powers and functions of the BSP Has 7 members: The Governor 5 full time members of the private sector 1 member from the cabinet http://www.bsp.gov.ph/about/governance.asp  THE BANKO SENTRAL NG PILIPINAS (BSP)  ORGANIZATION: BSP’s OPERATING SECTORS Currency Financial Monetary and Management Supervision Economics Sector Sector Sector Corporate Services Sector http://www.bsp.gov.ph/about/governance.asp THE BANKING INSTITUTION OF THE PHILIPPINES  can be categorized as: a. Private Banking b. Government Banking THE BANKING INSTITUTION OF THE PHILIPPINES Private Banking Institutions 1. Universal Banks 2. Commercial Banks 3. Thrift Banks 4. Rural Banks 5. Cooperative Banks http://www.bsp.gov.ph/banking/directories.asp http://www.bsp.gov.ph/banking/bspsup.asp  THE BANKING INSTITUTION OF THE PHILIPPINES Private Banking Institutions UNIVERSAL BANKS http://www.bsp.gov.ph/banking/directory.asp?BankName=&Instit utionTypeID=2&submit=Find THE BANKING INSTITUTION OF THE PHILIPPINES Private Banking Institutions COMMERCIAL BANKS http://www.bsp.gov.ph/banking/directory.asp?BankName=&InstitutionTypeID=&submit=Find  THE BANKING INSTITUTION OF THE PHILIPPINES Private Banking Institutions Universal Banks and Commercial Banks -represent the largest single group, resource-wise, of financial institutions in the country.  They offer the widest variety of banking services among financial institutions.  In addition to the function of an ordinary commercial bank, Universal banks are also authorized to engage in underwriting and other functions of investment houses, and to invest in equities of non-allied undertakings.  http://www.bsp.gov.ph/banking/bspsup.asp  THE BANKING INSTITUTION OF THE PHILIPPINES Private Banking Institutions UNIVERSAL BANKS As the investment banking arm of the Metrobank Group, First Metro has built a solid track record in origination, structuring, execution, and distribution. It offers a complete suite of products and services: debt and equity underwriting loan syndication project finance financial advisory government securities and corporate debt trading, equity brokering asset management research. THE BANKING INSTITUTION OF THE PHILIPPINES (UNIVERSAL BANK VS COMMERCIAL BANK ) THE BANKING INSTITUTION OF THE PHILIPPINES (UNIVERSAL BANK VS COMMERCIAL BANK ) THE BANKING INSTITUTION OF THE PHILIPPINES Private Banking Institutions THRIFT BANKS THE BANKING INSTITUTION OF THE PHILIPPINES The Thrift Banking System is composed of: a. savings and mortgage banks b. private development banks c. stock savings and loan associations d. microfinance thrift banks. - are engaged in accumulating savings of depositors and investing them. - provide short-term working capital and medium- and long-term financing to businesses engaged in agriculture, services, industry and housing, and diversified financial and allied services, and to their chosen markets and constituencies, especially small- and medium- enterprises and individuals. http://www.bsp.gov.ph/banking/bspsup.asp THE BANKING INSTITUTION OF THE PHILIPPINES Private Banking Institutions RURAL BANKS THE BANKING INSTITUTION OF THE PHILIPPINES Private Banking Institutions COOPERATIVE BANKS THE BANKING INSTITUTION OF THE PHILIPPINES Rural and Cooperative Banks  are the more popular type of banks in the rural communities.  Their role is to promote and expand the rural economy in an orderly and effective manner by providing the people in the rural communities with basic financial services.  help farmers through the stages of production, from buying seedlings to marketing of their produce.  Rural banks and cooperative banks are differentiated from each other by ownership. While rural banks are privately owned and managed, cooperative banks are organized/owned by cooperatives or federation of cooperatives.  THE BANKING INSTITUTION OF THE PHILIPPINES Government Banking Institutions  The Philippine government has been active in banking business.  This does not mean, though, that the government deliberately competes with the private banking industry.  The role of the government in the banking system is to supplement the credit facilities of the private financial institutions  THE BANKING INSTITUTION OF THE PHILIPPINES Government Banking Institutions  THE BANKING INSTITUTION OF THE PHILIPPINES Government Banking Institutions  The creation and operation of Land Bank of the Philippines (LBP) is authorized under the Code of Agrarian Reforms. The Agrarian Reforms Code created the Land Bank of the Philippines (LBP) to finance the acquisition and distribution of agricultural estates for division and resell these small landholders. https://www.landbank.com/about-us THE BANKING INSTITUTION OF THE PHILIPPINES Government Banking Institutions  started operating in 1935 as the National Loan and Investment Board.  Its first mission was to coordinate and manage trust funds. https://www.dbp.ph/about-dbp/ THE BANKING INSTITUTION OF THE PHILIPPINES Government Banking Institutions  - was created under Republic Act No. 6848  - purpose of promoting and accelerating the socio-economic growth of Mindanao, particularly the provinces of Cotabato, Lanao del Sur, Lanao del Norte, Zamboanga del Sur, Zamboanga del Norte, and Sulu http://www.amanahbank.gov.ph/ http://www.amanahbank.gov.ph/products-services  GOVERNMENT NON-BANK FINANCIAL INSTITUTIONS The government provides Filipinos social welfare services through: a. Social Security System (SSS) b. Government Service Insurance System (GSIS) c. Home Development Mutual Fund (Pag-IBIG https://www.gsis.gov.ph/?csrt=16172517756239309522 https://www.sss.gov.ph/ https://www.pagibigfundservices.com/ https://www.pagibigfund.gov.ph/ PRIVATE NON-BANK FINANCIAL INSTITUTIONS  Non-Bank with Quasi Banking Functions  This group consists of institutions engaged in the borrowing of funds from 20 or more lenders for the borrower's own account through: - issuances, endorsement or assignment with recourse or acceptance of deposit substitutes for purposes of relending or purchasing receivables and other obligations.  PRIVATE NON-BANK FINANCIAL INSTITUTIONS  Investment Houses  Investment Banks  Financing Companies  Lending Investors  Securities Dealers/Brokers  Pension Funds  Savings and Loans Association  Insurance Companies  Mutual Funds  Credit Unions  Pawnshops OTHER REGULATORY AGENCIES: http://www.pdic.gov.ph/ http://www.sec.gov.ph/ https://www.insurance.gov.ph/ http://www.sec.gov.ph/microfinance-ngo- regulatory-council/functions/ FOR FURTHER READINGS ANG INFORMATION  https://glenhawk.com/nbfi/#:~:text=The%20role%20of%20NBFIs%20is,competition%20in%20the%20financial%20sector.  http://www.conventuslaw.com/report/philippines-non-bank-financial-institutions-nbfis/  https://www.investopedia.com/terms/n/nbfcs.asp  https://www.google.com/search?safe=active&q=role+of+non+banking+financial+institutions+in+economic+development+pdf&sa=X&ved=2ahUKE wjU5pv_3cbqAhWNwpQKHYnPBlgQ1QIoA3oECAwQBA&biw=1536&bih=722