Maintenance check for Bangko Sentral long overdue

by Atty. Ignacio R. Bunye

Owners who like their motor vehicles always in tip-top shape send them to shops for regular maintenance checks.

Unfortunately, this wise practice does not seem to be the rule in the case of the Bangko Sentral ng Pilipinas (BSP) – which is one of the best government vehicles we have around.

Established almost 25 years ago, the BSP was envisioned as “an independent central monetary authority” that would “discharge its mandated responsibilities concerning money, banking and credit.”

It was also tasked “to maintain price stability conducive to a balanced and sustainable growth of the economy and “to promote and maintain monetary stability and the convertibility of the peso.”

Over the years, the BSP has performed its mandates well above expectations – earning for itself the reputation as one of the best-run Central Banks in the world. Its governors have also been recognized for years in a row as among the world’s best.

Surveys after surveys have consistently confirmed BSP’s status as the most respected public institution in the country today.

But for how long?

Over the last quarter century, the financial landscape has significantly changed.

Even among our policy makers in Congress, there is a widespread realization of the sweeping change in the country’s economic milieu, the increased integration of financial markets due to globalization and the evolution of financial institutions.

Thus, there is a need to retrofit BSP, making it better-equipped to respond to the changes in the environment.

There is agreement as to the need to strengthen BSP’s monetary stability function, to strengthen BSP’s financial stability function and to strengthen BSP’s corporate viability.

Well and good. At least, the legislative intent to enhance BSP’s capabilities is there.

The only problem is in the execution.

Year in and year out, we are witness to the filing of bills, in both houses of Congress, precisely to enable BSP to continue to discharge its functions well.

And year in and year out, however, these well-intentioned proposals end up among the “Mona Lisa bills.” Just like in the popular refrain, “They just lie there. And they die there.” Never mind, if these bills have been certified as urgent by the President.

We are hoping that this year, it will be different.

The good news is that after so many years, a House version of the proposal to strengthen the BSP finally made it to second reading last Monday. The same is expected to be approved on third and final reading when Congress resumes its session in July.

Among many others, the House version authorizes an increase in BSP capitalization four-fold (from P50B to P200B), restores the tax exempt status of BSP, authorizes BSP to issue its own own debt notes without undue restrictions.

The not-so-good news: We are not aware of any equivalent legislative discussion in the Senate. I would, of course, be glad to be proven wrong.

It will definitely be a win-win, if the Senate can devote a few days of its very precious time to this measure, and move in synch with the House of Representatives on the BSP charter amendment.

On-line scams continue to be prevalent

We continue to read about them so we just have to keep reminding our readers.

Facebook accounts are very susceptible to hacking.

Once an account is hacked, the hacker can send emergency calls for financial assistance to the account holder’s friends.

You can kiss your money goodbye if you fall for one of these distress calls – which, by the way, look very authentic.

A US-based friend recently sent an alert that her mother’s Facebook account had been hacked and asked friends to ignore her mother’s alleged pleas for financial help.

But too late. Her mother’s friends had already gladly parted with the equivalent of hundreds of thousands of pesos to assist whom they thought was a friend in need.

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What do you think?

Written by Tempo Online

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