Activist-turned-banker Moncupa sees expanded BSP role

Conclusion

Antonio Moncupa Jr. has something unique among all the candidates for the governorship of the Bangko Sentral ng Pilipinas —a “claim to fame” that none of the other shortlisted aspirants have.

In 1982, at the height of former President Marcos’ iron-fisted anticommunist campaign, the 23-year-old political activist was arrested by government agents along with his boss, ranking National Democratic Front official Horacio “Boy” Morales.

An avowed Leftist who spent actual time in the mountains with rebel cadres, Moncupa was thrown in a military stockade where he was detained for almost two years, beaten and tortured (one of his fingers is permanently scarred) by his captors.

Fast forward to the present and the former activist has traversed the sociopolitical spectrum from the extreme Left to the extreme Right. Today, he is not just any run-of-the-mill capitalist, but the president of an institution considered to be at the apex of capitalism—a bank. More specifically, he is the president and CEO of the Gotianun family-owned EastWest Bank, the 10th biggest universal bank in the country.

Despite this unlikely transition, Moncupa’s words betray a deeply rooted “pro-people” sentiment more commonly heard among his former comrades.

“The resulting job opportunities from the expected growth in private investments and its planned improvement in social services and agricultural productivity program would help attain [the Duterte administration’s] intent to have the benefits of growth to be more inclusive,” he said, when asked by the Inquirer about what people in charge of the country’s economy should be doing.

“The most important challenge for the country is still how to attain sustainable optimum growth,” he added. “We had a good run the last few years and I believe the current administration wants to further build on the momentum.”

Among the candidates for BSP chief, Moncupa has spent the most time “in the trenches” of the banking community, using his De La Salle University accounting degree to work his way up the corporate latter to specialize in the highly esoteric and technical field of banks’ treasury operations.

His career path was charted through Union Bank of the Philippines, United Coconut Planters Bank, International Exchange Bank (acquired by Union Bank in 2008) and eventually to EastWest Bank.

More importantly, however, Moncupa served as the Bankers Association of the Philippines’ Open Market Committee chair, an influential post to which only the most skilled bank treasurers are elected by their peers.

So what does a bank treasurer think about the central bank’s role in meeting the Philippines’ economic challenges? His answers show that he sees the BSP’s role as a delicate tightrope act.

“While fiscal policies are the main drivers to unleash the productive energies of the country, monetary authorities could play a significant complementary role,” Moncupa pointed out. “An appropriate management of money supply and inflation is important so that fiscal programs are sustainable. Too loose or too tight monetary policy could negatively impact the government’s programs.”

At the same time, the “dovish” banker in Moncupa also wants the government to push out more money toward would-be borrowers in the private sector to help boost growth (as opposed to the “hawkish” stance that favors the reining in of credit).

“More capital could be made available through the creation of infrastructure funds, which could initially be made available to qualified investor and eventually, if development permits, to make it available to a wider investors market,” he said.

Moncupa’s economic views —and his membership in President Duterte’s PDP-Laban political party—have won him the overt endorsement of Senate President Aquilino Pimentel III, who is also the party’s president.

If this activist-turned-banker earns the nod of the President, the country can expect a more powerful central bank. And like any good bank treasurer, Moncupa has a plan in mind in the event that he earns the President’s nod.

“It is worth looking into the advocacy of some groups to formally expand the BSP’s single mandate to ‘maintain price stability conducive to a balanced and sustainable growth of the economy’ and consider adding ‘maximizing employment’ as a distinct mandate just like in other jurisdiction like the United States,” he said. “This should add to the government efforts for inclusive growth.”

“Just like in business, we operate in an ever changing world and policy responses have to be calibrated to respond to new developments,” Moncupa added. “The challenge it to ensure that it continues to do so.”

Epilogue

Given the roster of illustrious and competent candidates to be the next chief of the BSP, it is unclear at this point which one has the inside track in President Duterte’s mind and the odds for each aspirant change from day to day.

What is clear, however, is this: In only 129 days from today, the purchasing power of every Filipino—how much the pesos in the pocket of 100 million citizens can buy—will be determined by a new central bank governor.