Amando M Tetangco, Jr: Efforts to provide an integrated national
payments and settlements system
Remarks by Mr Amando M Tetangco, Jr, Governor of the Central Bank of the Philippines
(Bangko Sentral ng Pilipinas), at the Signing of the MOA on the Interconnection of PDS
Settlement Highway (PSH) and BSP PhilPaSS, Bangko Sentral ng Pilipinas, Manila,
29 August 2007.
* * *
Monetary Board Members; Mr. Vicente Castillo, CEO, Philippine Dealing System Holdings
Corp; Mr. Ramon Sy, President, Bankers Association of the Philippines; guests from our
partners in the banking sector; BSP officials; our friends from the media; ladies and
gentlemen, good afternoon!
Today's MOA signing is another landmark in our joint efforts to provide an integrated national
payments and settlements system. As partners in the financial reform agenda, we have all
vigorously worked together to have the various pieces of the payments puzzle be put
together. In the process, we continue to work towards the establishment of the infrastructure
that would allow the secure and timely completion of transactions to reduce systemic risk in
the financial markets and thereby enhance the integrity of financial transactions.
In the course of the last five years, the BSP's PhilPaSS has been interconnected with the
check and peso clearing results of the PCHC, the Delivery vs. Payment of Government
Securities transactions of the Bureau of the Treasury, the ATM transactions of the Megalink
member banks, and the Payment vs. Payment (Foreign Exchange) transactions of the
Philippine Dealing Exchange. To date, all the commercial banks and 50% of the thrift and
savings banks and some non-banks performing quasi-banking operations settle these
various transactions in the PhilPaSS.
With the signing of the Memorandum of Agreement for the Interconnection of the Philippine
Dealing System Holdings Corporation's Settlement Highway with PhilPaSS, all the payment
instructions for transactions that would be done through the PDS Group could now be
transmitted directly to the BSP-PhilPaSS and effected in the DDAs of the counterparties who
are PhilPaSS member banks or through the DDAs of the PhilPaSS member bank in their
capacity as Settlement Banks for non-PhilPaSS members. These transactions include
foreign currency transactions, interbank and interdealer repo transactions, and interbank
fund transfers.
It is also worthy to note that this interconnectivity comes at very minimal cost. This is
because the infrastructure is already in place; all that needed to be done was minimal
reconfiguration of the existing systems to capture these additional types of financial
transactions.
The Bangko Sentral ng Pilipinas, in fulfilling the third pillar of its mandate, will continue to
work to improve the operations of the PhilPaSS to better address all the concerns of our
stakeholders. We are well aware, however, that we cannot do this alone. We look forward to
your continued support and partnership.
Thank you!