amando m tetangco, jr : the bsp and the banking industry – weaving a story of growth and development speech by mr amando m tetangco, jr, governor of bangko sentral ng pilipinas ( bsp, the central bank of the philippines ), at the annual reception for the banking community, malate, 23 january 2015. * * * on behalf of the members of the monetary board, your other hosts for tonight : finance secretary cesar purisima ( who is currently on official mission abroad ), freddie antonio, phillip medalla, andy suratos, juan de zuniga and val araneta, i thank all of you for accepting our invitation. this marks the 10th year that i am welcoming you to the fort san antonio abad for the bsp ’ s annual reception for the banking community. this is the only time in a year that the bsp hosts in one event, the leadership of the philippine banking industry – from the universal and commercial banks to the thrift banks and the rural banks – in a multi - sectoral gathering. after all, the banking industry serves the cross section of our society. in other words, all of us here have a stake in the banking sector, a very important pillar of our economy. as in the past, i will briefly review how we fared last year, discuss how we see the operating environment for this year, and share how we can move forward together to achieve even better results. review of 2014 well, 2014 certainly turned out to be a good year for the philippine economy in general and for the banking sector in particular, although it did not start this way. about this time last year, we were faced with significant capital outflows and as a result, the peso came under strong depreciation pressures. in may to august, inflation spiked to levels that threatened the attainment of the government ’ s inflation target. in addition, losses from a series of natural disasters slowed our economy. gdp grew 5. 8 % in the first three quarters last year, slower than in the comparable period in 2013. even so, the philippines still emerged as one of the fastest growing economies in the region. indeed, our country ’ s underlying story of resilience remained intact through the challenges of 2014 with continuing economic and governance reforms keeping us on the growth track. on our part, the bangko sentral implemented preemptive and sequential monetary and macroprudential policies that helped

parents of elementary school pupils. schools now request this program which runs parallel to the classroom teachings of elementary pupils. at the same time, 12 banks joined hands to launch the kiddie account program. while these banks were no stranger to children ’ s accounts, they all agreed on the need to make saving affordable, accessible and convenient to attract more kiddie savers. after negotiations that took nearly two years, the 12 banks agreed on a common denominator : children are welcome to open accounts with them with a minimum deposit of only 100 pesos or less than us $ 3. 00. and to further help make saving a habit, bank representatives also go directly to schools to service children ’ s deposits. so far, so good : thousands of new accounts are being generated by the kiddie account program and withdrawals are minimal. since children exert influence in household decisions, we hope that their habit of saving will rub off on other members of the households, including the adults. based on the results of the bsp ’ s household finance survey, only 20 % of philippine households maintain bank accounts. we are therefore looking at this program as a way to help raise the savings rate in the philippines. i understand that yesterday many of our foreign delegates visited the aurora quezon elementary school to observe how financial lessons are taught and to hear how banks are implementing their kiddie account programs. did you find it useful? that is good to know. ladies and gentlemen, our continuing journey takes us through uncharted territory. nevertheless, we are encouraged by positive feedback – from the pupils who start saving regularly, to the teachers who say they learn life lessons from the program. also a positive is the 2011 citi financial quotient survey where the philippines showed sustained improvements in its score. nevertheless, we have a long way to go and a lot more to learn. it is for this reason that we look forward to this regional meeting on child and youth finance for asia and the pacific. i hope therefore that our conference today will be successful and fruitful. finally, we thank the child and youth finance international for bringing this regional meeting to manila and for taking the lead in the global movement to promote the habit of saving among schoolchildren. we also commend their design props today – the multi - colored bis central bankers ’ speeches balloons and throw pillows. it reminds us that while we are tackling a serious subject, we should not forget that our intended beneficiaries should find it fun to find