The Bangko Sentral ng Pilipinas (; commonly abbreviated as BSP in both Filipino and English) is the central bank
of the Philippines. It was established on July 3, 1993, pursuant to the provision of Republic Act 7653 or the New Central Bank Act of 1993 as amended by Republic Act 11211 or the New Central Bank Act of 2019.
American era and World War II
In 1900, the First Philippine Commission
passed Act No. 52, which placed all banks under the Bureau of the Treasury and authorizing the Insular Treasurer to supervise and examine banks and all banking activity. In 1929, the Department of Finance
, through the Bureau of Banking, took over bank supervision.
By 1933, a group of Filipino
s had conceptualized a central bank for the Philippine Islands
. It came up with the rudiments of a bill for the establishment of a central bank after a careful study of the economic provisions of the Hare–Hawes–Cutting Act
, which would grant Philippine independence after 12 years, but reserving military and naval bases for the United States and imposing tariffs and quotas on Philippine exports. However, the Hare–Hawes–Cutting Act would be rejected by the Senate of the Philippines
at the urging of Commonwealth President Manuel L. Quezon
. This Senate then advocated a new bill that won United States President Franklin D. Roosevelt
's support, this would be the Tydings–McDuffie Act
, which would grant Philippine independence on July 4, 1946.
Under the Commonwealth
, discussions continued regarding the idea of a Philippine central bank that would promote price stability
and economic growth. The country's monetary system then was administered by the Department of Finance and the National Treasury, and the Philippine piso
was on the exchange standard using the United States dollar
, which was backed by 100 percent gold reserve
, as the standard currency.
As required by the Tydings–McDuffie Act
, the National Assembly of the Philippines
in 1939 passed a law establishing a central bank. As it was a monetary law, it required the approval of the President of the United States
; Franklin D. Roosevelt
did not give his. A second law was passed in 1944 under the Japanese-controlled Second Republic
during the Second World War
, but the 1945 arrival of American liberation forces, aided by Philippine Commonwealth troops and recognised guerrillas, aborted its implementation.
Third Republic and martial law
Shortly after President Manuel Roxas
assumed office in 1946, he instructed then-Finance Secretary Miguel Cuaderno, Sr. to draw up a charter for a central bank. The establishment of a monetary authority became imperative a year later as a result of the findings of the Joint Philippine-American Finance Commission chaired by Cuaderno. The commission, which studied Philippine financial, monetary, and fiscal problems in 1947, recommended a shift from the dollar exchange standard to a managed currency system. A central bank was necessary to implement the proposed shift to the new system.
Roxas then created the Central Bank Council to prepare the charter of a proposed monetary authority. It was submitted to Congress
in February 1948. By June of the same year, the newly proclaimed President Elpidio Quirino
, who succeeded President Roxas, affixed his signature on Republic Act
(RA) No. 265, the Central Bank Act of 1948. On January 3, 1949, the Central Bank of the Philippines was formally inaugurated with Miguel Cuaderno, Sr. as the first governor. The main duties and responsibilities of the Central Bank were to promote economic development and maintain internal and external monetary stability.
Over the years, changes were introduced to make the charter more responsive to the needs of the economy. On November 29, 1972, President Ferdinand Marcos
' Presidential Decree No. 72 amended Republic Act No. 265, emphasizing the maintenance of domestic and international monetary stability as the primary objective of the Central Bank. The Bank's authority was also expanded to include regulation of the entire financial system of the Philippines and not just supervision of the banking system. In 1981, RA 265, as amended, was further improved to strengthen the financial system, among the changes was the increase in the capitalization of the Central Bank from Php
10 million to Php 10 billion. By 2019, President Duterte signs R.A. 11211 further increasing the capitalization to Php 200 billion.
In the 1973 Constitution
, the interim ''Batasang Pambansa
'' (National Assembly) was mandated to establish an independent central monetary authority. Presidential Decree No. 1801 designated the Central Bank of the Philippines as the central monetary authority (CMA). According to a confidential October 19, 1984 Monetary Board report, the Central bank overstated the country's dollar reserves $600 million.
The 1987 Constitution adopted the CMA provisions from the 1973 Constitution that were aimed essentially at establishing an independent monetary authority through increased capitalization and greater private sector representation in the Monetary Board.
In accordance with a provision in the 1987 Constitution
, President Fidel V. Ramos
signed Republic Act
No. 7653, otherwise known as the ''New Central Bank Act'', into law on June 14, 1993. The law provides for the establishment of an independent monetary authority to be known as the Bangko Sentral ng Pilipinas, its primary objective being the maintenance of price stability. This objective was only implied in the old Central Bank charter. The law also gives the Bangko Sentral fiscal and administrative autonomy which the old Central Bank did not have. On July 3, 1993, the New Central Bank Act took effect.
On the evening of September 26, 2012, a Wednesday, the BSP website was hacked by a group named ''Anonymous Philippine''s in a protest against the recently passed Cybercrime Prevention Act of 2012
. The website was promptly restored in the early hours of the following day.
On April 23, 2013, The Asian Banker
named the BSP as the Best Macroeconomic Regulator in the Asia-Pacific Region for 2013 in ''The Asian Banker Leadership Achievement Awards'' in Jakarta
. The BSP was cited as a “good, strong, and fair-minded regulator.” About a month later, the BSP was given the country award by the Child and Youth Finance International in its 2013 International Summit in Istanbul
, in recognition of its initiative to integrate financial education in the Philippine elementary school curriculum.
Roles and responsibilities
As prescribed by the ''New Central Bank Act'', the main functions of the Bangko Sentral are:
# Liquidity management, by formulating and implementing monetary policy aimed at influencing money supply, consistent with its primary objective to maintain price stability,
# Currency issue. The BSP has the exclusive power to issue the national currency. All notes and coins issued by the BSP are fully guaranteed by the Government
and are considered legal tender
for all private and public debts,
# Lender of last resort
, by extending discounts, loans and advances to banking institutions for liquidity
# Financial supervision, by supervising banks and exercising regulatory powers over non-bank institutions performing quasi-banking functions,
# Management of foreign currency reserves, by maintaining sufficient international reserves
to meet any foreseeable net demands for foreign currencies in order to preserve the international stability and convertibility of the Philippine peso,
# Determination of exchange rate policy
, by determining the exchange rate policy of the Philippines. Currently, the BSP adheres to a market-oriented foreign exchange rate
# Being the banker, financial advisor and official depository of the Government, its political subdivisions and instrumentalities and GOCCs
The basic structure of the Bangko Sentral includes:
* The Monetary Board, which exercises the powers and functions of the BSP, such as the conduct of monetary policy and supervision of the financial system;
* The Monetary Stability Sector, which takes charge of the formulation and implementation of the BSP's monetary policy, including serving the banking needs of all banks through accepting deposits, servicing withdrawals and extending credit through the rediscounting facility;
* The Supervision and Examination Sector, which enforces and monitors compliance to banking laws to promote a sound and healthy banking system; and
* The Resource Management Sector, which serves the human, financial and physical resource needs of the BSP.
The powers and function of Bangko Sentral are exercised by its Monetary Board, whose seven members are appointed by the President of the Philippines. As provided for by RA 7653 or the New Central Bank Act, one of the government sector members of the Monetary Board must also be a member of Cabinet
. Members of the Monetary Board are prohibited from holding certain positions in other government agencies and private institutions that may give rise to conflicts of interest. The members have fixed and overlapping terms, except for the Cabinet Secretary representing the incumbent administration.
The current members of the Monetary Board are:
* Benjamin Diokno
, BSP Governor
and Chairman of the Monetary Board
** Francisco G. Dakila, Jr. – Deputy Governor of the BSP
** Ma. Almasara Tuaño-Amador- Deputy Governor of the BSP
** Chuchi Fonacier- Deputy Governor of the BSP
* Carlos Dominguez III
, Secretary of the Department of Finance
* Antonio S. Abacan, Jr.
*V. Bruce J. Tolentino
* Felipe M. Medalla
* Peter B. Favila
* Anita Linda Aquino
The Bangko Sentral has 19 currencies directly convertible with the Philippine peso
, which serves as a benchmark for all Philippine banks.
* Australian dollar
* Bahraini dinar
* British pound
* Brunei dollar
* Canadian dollar
* Dominican peso
* Chinese yuan
* Hong Kong dollar
* Indonesian rupiah
* Japanese yen
* Mexican peso
* South Korean won
* Kuwaiti dinar
* Saudi riyal
* Singapore dollar
* Swiss franc
* Thai baht
* New Taiwan dollar
* United Arab Emirates dirham
* United States dollar
Microfinance and financial inclusion
In 2000, the General Banking Law mandated the BSP to recognize microfinance
as a legitimate banking activity and to set the rules and regulations for its practice within the banking sector. In the same year, the BSP declared microfinance as its flagship program for poverty
alleviation. The BSP has become the prime advocate for the development of microfinance. To this end, the Bangko Sentral aims to:
# Provide the enabling policy and regulatory environment;
# Increase the capacity of the BSP and banking sector on microfinance operations; and
# Promote and advocate for the development of sound and sustainable microfinance operations.
The Bank is active in promoting a financial inclusion
policy and is a leading member of the Alliance for Financial Inclusion. It is also one of the original 17 regulatory institutions to make specific national commitments to financial inclusion under the Maya Declaration
during the 2011 Global Policy Forum
held in Mexico
With money laundering
being one of the problems of the Philippines, the BSP has issued a number of measures to bring the Philippines' regulatory regime on money laundering closer to international standards. In September 2001, the ''Anti-Money Laundering Act'', or AMLA, was made into law. The AMLA defined money laundering a criminal offense, and prescribed corresponding penalties. It also provided the foundation for a central monitoring and implementing council called the ''Anti-Money Laundering Council
'' (AMLC). The AMLC is composed of the Governor of the Bangko Sentral as Chair, and the Commissioner of the Insurance Commission and the Chairman of the Securities and Exchange Commission
as members, all acting unanimously in the discharge of the group's mandate.
In February 2013, Philippine President Benigno Aquino III
signed "R.A. No. 10365" known as ''An act further strengthening the Anti-Money Laundering Law'', which aims to strengthen the AMLC by requiring that any suspicious transaction in foreign exchange, real estate, and jewelry and precious metal trading be reported.
The current logo of the Bangko Sentral ng Pilipinas was adopted in January 2021 with the design receiving endorsement by the National Historical Commission of the Philippines
. The circular symbol features a full-bodied gold-colored Philippine eagle
based on actual photographs of the bird and three stars.
The old logo introduced in 2010 which is still currently used in coinage and banknotes in circulation features a blue and white logo and a more stylized rendition of the eagle.
Within the Manila complex of the Bangko Sentral ng Pilipinas is the ''Museo ng Bangko Sentral ng Pilipinas'' (English: Museum of the Bangko Sentral ng Pilipinas). Inaugurated on January 3, 1999, as part of the celebration of the 50 years of central banking in the Philippines, the museum showcases the Bank's collection of currencies.
As repository and custodian of the country's numismatic heritage, the ''Museo'' collects, studies and preserves coins, paper notes, medals, artifacts and monetary items found in the Philippines during its different historical periods. These collections have been placed on permanent display at the ''Museo''.
Designed to "walk" the visitor through a number of galleries dedicated to a specific historical period of the country, the ''Museo'' visually narrates the development of the Philippine economy, parallel to the evolution of its currency.
Complementary paintings from the BSP art collection, together with chosen artifacts, enhance each gallery.
A panoramic memorabilia of 50 years of central banking in the Philippines, showcases the strides made in bringing about price stability, to sustain economic growth in the country. The exhibition hall also carries the busts of the governors of the Central Bank/Bangko Sentral.
Security Plant Complex
The Security Plant Complex, or SPC, was formally established on September 7, 1978 to safeguard the printing, minting, refining, issuance, distribution and durability of coins, banknotes, gold bars, government official receipts, lottery tickets, internal revenue stamps, passports, seaman identification record books, strip stamps, official documents, registration certificates, Torrens titles, treasury warrants, stocks and bonds, government contracts, ration coupons, official ballots, election return forms, checks and other security printing or minting jobs of the Philippine government.
Printing of official ballots and other public documents was later transferred to the National Printing Office pursuant to Executive Order No. 285 issued on July 25, 1987.
On August 4, 2003, President Gloria Macapagal-Arroyo issued "Administrative Order No. 79", which designated the SPC as the sole manufacturer of presidential medals and decorations.
The BSP will relocate its security plant complex from East Avenue, Quezon City to the National Government Administrative Center district of New Clark City in Capas, Tarlac after it signed a memorandum of agreement with the Bases Conversion and Development Authority in September 2019. The new currency production facility will be located at the 29-hectare land near the access road connecting New Clark City to the Subic–Clark–Tarlac Expressway and it is expected to be completed within two years.
Image:Philippine land title.jpg|Torrens titles
File:Philippine Passport Biometric 2014.jpg|Passports
About the ''Bangko Sentral''
Bsp exchange rate
Category:Department of Finance (Philippines)
Category:Economy of the Philippines
Category:Banks established in 1949
Category:Banks of the Philippines
Category:Government-owned and controlled corporations of the Philippines
Category:Philippine companies established in 1949