INQUIRER FILE PHOTO
The Bangko Sentral ng Pilipinas (BSP) on Friday announced it will further reduce the reserve requirement ratio (RRR) of banks in a bid to inject more liquidity to the domestic economy.
The BSP will cut the RRRs by 250 basis points (bps) for universal and commercial banks (U/KBs) and non-bank financial institutions with quasi-banking functions (NBQBs); 200 bps for digital banks; and 100 bps for thrift banks (TBs) and for rural banks and cooperative banks (RCBs).
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The reduction shall bring the RRRs of U/KBs and NBQBs to 7.0 percent; digital banks to 4.0 percent; TBs to 1.0 percent; and RCBs to 0.0 percent.
The new ratios shall take effect on the reserve week beginning on October 25, 2024 and shall apply to the local currency deposits and deposit substitute liabilities of banks and NBQBs.
“The BSP emphasizes that these adjustments in reserve requirements are in line with its continuing efforts to reduce distortions in the financial system. The reductions will lower intermediation costs and promote better pricing for financial services,” the central bank said.