amando tetangco : the philippine banking system - the past, the present and the future speech by mr amando m tetangco, jr, governor of bangko sentral ng pilipinas ( bsp, the central bank of the philippines ), at the 2017 annual reception for the banking community, manila, 10 january 2017. * * * it is a tradition that we host this reception at the beginning of the year, when we commemorate the anniversary of central banking in the philippines. for the information of those among us who are too young to remember, the central bank of the philippines or the cbp opened for business for the first time on january 3, 1949 ; that ’ s 68 years ago. and while the country ’ s central monetary authority is now the bangko sentral ng pilipinas — whose 24th anniversary we will celebrate on july 3, 2017 – we maintain the tradition of holding this annual event at the beginning of the year. to us, this is the perfect time to reflect on the past, the present, the future and how we can make things work even better, moving forward as one community. 2016 has been described as a year like no other – it started off with a bang, with china ’ s stock market on a seeming free fall that shook global markets ; we saw for the most part of the year global anxiety over the timing, pace and magnitude of the us fed policy rate decision ; by midyear, the unexpected brexit results shocked us ; then came the surprise victory of us presidentelect donald trump. 2016 ended with the world uncertain over global politics and policies and how these would impact on economies and people. indeed, 2016 brought volatility, uncertainty and other threats to growth and stability. in the philippines, strong fundamentals borne out of the continuing pursuit of a reform agenda, kept our economy going … and growing. and once again, we achieved convergence of low inflation ( below 2 % ) and healthy growth. the philippine economy grew by a 7. 0 % in the first three quarters of 2016, giving us the distinction of being among the fastest growing economies in asia. and it is broad - based growth we can be proud of : it was supported by a strong services sector, a resurging industry and manufacturing sector, a rebounding agriculture sector, and robust consumption and capital formation. our external position also provided additional support to the economy. the peso remained in line with regional movements, while our current account continued to

on the country ’ s macroeconomic fundamentals and strong growth prospects. the country ’ s outstanding external debt also remains at a prudent level as its ratio to gdp slightly eased to 26. 5 percent in end - june 2021. notably, a large portion of the country ’ s external debt has medium - and long - term maturity profile and carry fixed interest rates. these two factors make the servicing of foreign debt less susceptible to volatilities in global interest rates or foreign exchange fluctuations. the gross international reserves stood at us $ 108 billion as of october. this is equivalent to almost 11 months ’ worth of imports of goods and payments of services and primary income. the conventional wisdom is that 3 months ’ worth of imports is sufficient. the gir level is also about 7. 8 times the country ’ s short - term external debt based on original maturity, and 5. 4 times based on residual maturity. the gross international reserves continue to be augmented by improving inflows of cash remittances from overseas workers and receipts from business process outsourcing. on msmes : the bsp recognizes the crucial role of micro, small, and medium enterprises in the philippine economy. let me discuss the wide range of policies and regulatory and relief measures that the bsp has deployed to support msmes. - one is allowing the new peso - denominated loans to msmes and critically impacted large enterprises that do not belong to a conglomerate as eligible instruments for compliance with the bsp ’ s reserve requirement. the use of msme loans as allowable alternative compliance with the reserve requirement shall be available to banks and non - bank financial institutions with quasibanking functions from 24 april 2020 to 29 december 2022, subject to early closure of the eligibility window by the monetary board, if warranted and with prior notice. - for the week ending 31 october 2021, the banking system allocated an average of p202. 2 billion loans for msmes as alternative compliance with the reserve requirements. this level marks a substantial increase from the p8. 7 billion average msme loans that were reported for the week ending 30 april 2020. the latest level is equivalent to 13. 6 percent of the total required reserves, from 0. 6 percent on 30 april 2020. - the monetary board also approved prudential measures to assist msmes. the regulatory capital treatment of msme exposures was amended to temporarily reduce the risk weights of 2 / 4 bis central bankers'speeches loans granted to msmes