Bangko Sentral ng Pilipinas plans to put in place 82 regulations next year to better manage risks and improve governance for financial institutions under its supervision.
Bangko Sentral Deputy Governor Nestor Espenilla Jr. said the new regulations would not be all directed to the banking industry.
“We are trying to elevate the corporate governance in the banking industry. We also try to improve the risk governance in banks because for every opportunity, there is also an associated threat. So these will all occur in 2017,” Espenilla said at the sidelines of the Chamber of Thrift Banks general membership meeting in Makati City Tuesday.
He said among these regulations would be a regulation enhancing the standard for liquidity management of banks and enhancement of technology risk management framework.
“This will elevate the game [such as cloud computing] and this will present an opportunity for banks to improve their operations,”Espenilla said.
Also included would be regulations on financial transparency. Espenilla said banks needed to discipline themselves and police their own ranks.
Espenilla said Bangko Sentral started last month the review of the changes in the industry in the past years, including the regulations and circulars implemented for the betterment of the banking industry.
Aside from banks, Bangko Sentral also supervises and regulates pawnshops, lending investors, non-stock savings and loan associations, venture capital corporations, credit card companies, investment houses, finance companies, investment companies and securities dealers/brokers.
Earlier, Bangko Sentral said it would upgrade the regulations on non-bank financial institutions in a bid to make the industry players comply with their anti-money laundering obligations.
Espenilla said this was in line with the move to prevent the recurrence of money laundering activities in the country, the latest of which involved $81-million that was believed stolen by cyber thieves from the account of Bank of Bangladesh in the Federal Reserve in New York.
The dirty money entered the Philippine banking system through a branch of Rizal Commercial Banking Corp. in Makati City in February. One of the conduits in the transfer of the illegal funds was the remittance firm Philrem Service Corp.
“We are reviewing circular 471 which is the regulation on non bank financial institutions which includes remittance businesses…. So we are upgrading the regulations,” Espenilla told reporters.
He said the upgraded rules”•with clearer and well-defined obligations particularly on money laundering responsibilities”•would apply to all existing players.
Espenilla said in April the regulator was also closely monitoring the activities of pawnshops and non-stock savings and loans associations.
He said pawnshops, in particular, evolved beyond the traditional construct of a corner establishment where anybody could bring their jewelry in exchange of money as payback.
He said a significant chunk of pawnshop business was actually derived from remittance activities and other kinds of cross-sold activities. He said pawnshops were the number one distributors of micro insurance.
