BSP steps up forex liberalization effort

The Bangko Sentral ng Pilipinas has removed the registration requirements for foreign loans of non-banks with quasi-banking functions (NBQBs), part of the foreign exchange liberalization measures introduced by monetary authorities.

In a statement, the BSP said the Monetary Board had approved to lift the rule mandating prior BSP approval, among other requirements, for NBQBs’ loans from offshore sources, offshore banking units and banks’ foreign currency deposit units.

The BSP said the new rule would take effect on Sept. 15, alongside other liberalization measures approved by the Monetary Board last week.

BSP Governor Amando M. Tetangco Jr. said the new policy “will facilitate borrowing transactions of NBQBs to fund their operations and projects and better contribute to economic growth.”

These accounts, however, will remain covered by the reportorial requirements under the Manual of Regulations on Foreign Exchange Transactions, he said.

Last week, the BSP unveiled a package of liberalization measures for the forex market, raising the amount the individuals or corporations can buy from local banks without the need for supporting documentation.

Filipinos can now buy as much as $500,000 from local banks without need for supporting documentation other than a pro-forma application to purchase the foreign exchange, while domestic companies can buy as much as $1 million from banks under the same no-documentation-required scheme. Previously, both individual and corporate buyers could only buy $120,000 from banks on a no-questions-asked basis.