Quantcast
Latest Stories

BSP adopts rules compliance rating system for PH banks

By

MANILA, Philippines—The Bangko Sentral ng Pilipinas (BSP) has established a rating system that will evaluate banks’ compliance with various regulations that were designed to ensure the sustainability of their favorable financial standing.

The BSP said the “Compliance Rating System,” embodied in Circular 747, would be implemented starting September this year.

Banks will be rated using a scale of 1 to 4, with 1 indicating the weakest and 4 the strongest level of compliance with various regulations implemented by the BSP.

Those that will get weaker scores are expected to receive tighter supervision by the BSP.

The ratings to be given to banks will depend on their performance in three areas:

– The effectiveness and efficiency of the board of directors (BOD) and senior management (SM) in fulfilling their duties and responsibilities.

– The soundness and effectiveness of banks in implementing their own compliance programs

– The adequacy and soundness of internal controls, which help the BOD and SM in identifying, measuring and controlling business risks

Business risks, according to the BSP, should be identified, measured and controlled, as these could erode the franchise value of the institutions.

“BSP Circular 747 requires institutions to have a robust, dynamically responsive and appropriate compliance system as an integral component of an institution’s internal controls,” the central bank said.

It added that the system was meant to prevent operational weakness of banks brought about by violations of rules and regulations.

The BSP said the higher the level of compliance of banks with rules and regulations, the more likely the banking sector would remain strong and stable.

The regulator said that currently, the Philippine banking system was sound, given healthy profits of industry members, their growing liquidity and capitalization, and low exposure to defaults.

The BSP earlier reported that the combined profits of rural, thrift, universal and commercial banks in the country amounted to P122.12 billion last year, up by 17 percent from P104.73 billion in 2011.


Follow Us


Follow us on Facebook Follow on Twitter Follow on Twitter


Recent Stories:

Complete stories on our Digital Edition newsstand for tablets, netbooks and mobile phones; 14-issue free trial. About to step out? Get breaking alerts on your mobile.phone. Text ON INQ BREAKING to 4467, for Globe, Smart and Sun subscribers in the Philippines.

Tags: Bangko Sentral ng Pilipinas , Banking , Rules



Copyright © 2014, .
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City, Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94
Advertisement
Advertisement

News

  • Easterlies to prevail in Luzon, Visayas
  • Lacson eyes P106-B ‘Yolanda’ rehab masterplan
  • What Went Before: Malacañang allies alleged involvement in pork scam
  • Timeline: Napoles tell-all
  • 12 senators on Napoles ‘pork’ list, says Lacson
  • Sports

  • Mixers trim Aces; Painters repulse Bolts
  • Donaire junks Garcia as coach, taps father
  • ’Bye Ginebra: No heavy heart this time
  • UAAP board tackles new rules
  • Baguio climb to decide Le Tour de Filipinas
  • Lifestyle

  • No tourist draw, Malang the croc will remain wild
  • The best flavors of summer in one bite, and more
  • Homemade yogurt, bread blended with pizza, even ramen
  • Visiting chefs from Denmark get creative with ‘ube,’ ‘ buko,’ ‘calamansi,’ mangoes
  • Salted baked potatoes
  • Entertainment

  • Return of ‘Ibong Adarna’
  • Practical Phytos plans his future
  • In love … with acting
  • From prison to the peak of success
  • ‘Asedillo’ location thrives
  • Business

  • Cost-recovery provisions for affected gencos urged
  • This time, BIR goes after florists
  • Philippine Airlines to stop shipment of shark fins
  • PH banks not ready for Asean integration
  • Stocks down on profit-taking
  • Technology

  • No truth to viral no-visa ‘chronicles’
  • ‘Unlimited’ Internet promos not really limitless; lawmakers call for probe
  • Viber releases new design for iPhone, comes to Blackberry 10 for the first time
  • Engineers create a world of difference
  • Bam Aquino becomes Master Splinter’s son after Wiki hack
  • Opinion

  • Editorial cartoon, April 24, 2014
  • Talking to Janet
  • Respite
  • Bucket list
  • JPII in 1981: walking a tightrope
  • Global Nation

  • Filipinos in Middle East urged to get clearance before returning
  • PH seeks ‘clearer assurance’ from US
  • China and rivals sign naval pact to ease maritime tensions
  • What Went Before: Manila bus hostage crisis
  • Obama arrives in Tokyo, first stop of 4-nation tour
  • Marketplace