‘One government, one nation’: BSP advances P20B in dividends for COVID-19 fight

To further support the government in its fight against the coronavirus pandemic, the Bangko Sentral ng Pilipinas said on Thursday (March 26) that it will remit in advance some P20 billion in dividends to the state’s coffers.

These advance dividends constitute 87 percent of the estimated total dividends based on the central bank’s unaudited financial statements for 2020, it said in a statement.

“We are one government. We are one Filipino nation. And we, at the BSP, shall support all efforts to fight this once-in-a-lifetime pandemic and keep the economy afloat,” BSP Governor Benjamin Diokno said.

“The BSP has and is ready to employ the necessary tools in its arsenal to address the impact of COVID-19 while staying true to its mandate,” he added.

Under its newly amended charter, the BSP is no longer mandated to remit its dividends to the central government. Section 2 of Republic Act No. 7653, as amended by RA 11211, provides that any and all declared dividends of the BSP in favor of the national government shall be released and disbursed immediately for the payment of the central bank’s increase in capitalization.

“Nevertheless, considering this extraordinary time, the Monetary Board has approved to defer the application of the BSP’s dividends for 2019 to the BSP’s capital and remit P20 billion advance or partial dividends to support the national government’s programs during this enhanced community quarantine due to COVID-19,” the central bank statement said.

BSP was expected to remit the P20 billion advance dividends on Thursday through directd credit to the Bureau of the Treasury’s account with the central bank.

To date, the BSP has committed to purchase government securities from the Bureau of the Treasury under a repurchase agreement in the amount of P300 billion, cut banks’ reserve requirement ratio by 200 basis points and policy rate by 50 basis points, enabled continued access to banking institutions, and called on banks to extend all help they can to serve the broader economy and the rest of the Filipino people.

Edited by TSB