BSP Deputy Governor Nestor A. Espenilla Jr. Photo courtesy of Bangko Sentral ng Pilipinas
President Duterte on Monday chose Deputy Governor Nestor Espenilla Jr. to be the country’s next Bangko Sentral ng Pilipinas chief — a choice billed by Finance Secretary Carlos Dominguez III as “the most important economic decision” that the Chief Executive would have to make.
Dominguez confirmed the long-awaited decision to the Inquirer in a text message saying “It’s N. Espenilla,” adding that this constituted the administration’s official announcement.
DEVELOPING: Text message from @SecSonnySays: "It's [Nestor] Espenilla" for BSP governor | @daxINQ pic.twitter.com/5SSTcyY3k5
— Inquirer Business (@InquirerBiz) May 8, 2017
He will replace Amando Tetangco who will retire in July after serving the maximum two six-year terms.
Espenilla — a career BSP employee who started his stint at the central bank in 1981 as a debt analyst — bested three other candidates in what administration officials described said was a tight race between fellow Deputy Governor Diwa Guinigundo, former Trade Secretary and Monetary Board member Peter Favila and Eastwest Bank vice chair Antonio Moncupa.
In the end, the President appointed the man who had the least amount of political connections, and the official who, according to banking industry insiders, had the least ambition for the job.
In an earlier interview with the Inquirer, “Nesting” said that the country’s next central bank governor would have to adopt job creation as “Mission Number One”, adding that policymakers must “keep their eye on the ball” to ensure that more of the country’s 100 million citizens enjoy the benefits of economic growth.
READ: Job-creating growth is Mission No. 1 for BSP’s Espenilla
“We need to stay focused on creating and sustaining a high-growth economy that can provide the productive job opportunities and higher standard of living for our young, large and fast-growing population,” he said last February.
“This is key to overcoming large-scale poverty and achieving a peaceful and stable society,” he added. “Six years will not be enough but we can certainly build a lot of momentum.”
Espenilla joined BSP just two years before an economic crisis pushed the Philippines into de facto bankruptcy in 1983, stopping the payment its repayment foreign debt due to a lack of dollars.
After graduating magna cum laude from the University of the Philippines in business economics, he continued with an honors MBA degree in 1982 and steadily rose through the BSP’s ranks until he was eventually appointed deputy governor in 2005.
Espenilla accumulated over 35 years of experience in all aspects of modern Philippine central banking like monetary policy, banking supervision and financial regulation, payments system oversight, capital markets development, currency management, consumer protection and financial inclusion advocacy.
As head of the banking supervision division, Espenilla steered the BSP toward the development and implementation of financially inclusive banking regulations that prioritized the needs of the Filipino consumer, including the institution of the National Retail Payment System project.
His most important role, however, was acting as the central bank’s “bad cop” when dealing with financial institutions found to be in violation of regulations. It is a role that earned him the ire and fear of some senior bankers, but also respect among other stakeholders in the financial industry.
Going forward, Espenilla said he wanted the BSP to have a more proactive role in promoting the country’s growth.
“There’s a lot more the BSP can do beyond these,” he said. “A key role is to be a steadfast and credible champion of structural reforms in the financial system — in particular, promoting a modern digital financial ecosystem that allows innovative and competitive financial services, enables all to participate and treats clients fairly.”
Espenilla’s appointment was made during the 15th Cabinet Meeting in Malacañang on Monday afternoon. With a report from Nestor Corrales INQUIRER.net