amando m tetangco : philippine banking in an integrated regional financial market 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 closing plenary of the 29th national convention of the bankers institute of the philippines, tagaytay city, 11 march 2017. * * * good evening everyone! it is a great pleasure for me to join baiphil ’ s 29th national convention. baiphil is important to us. you are one of the key partners of the bsp in ensuring that the quality of bank personnel meets the rigorous requirements of our banking system. this is crucial — our banking sector has grown into a p13. 5 trillion industry in terms of assets and is responsible for deposits that have reached a record high of p10. 4 trillion as of december 2016. this is a great responsibility. given this, and as we consider the way forward, let me take this opportunity to share with you my thoughts about critical developments that will define our financial markets in the years to come. i will take this opportunity therefore to share my thoughts about critical developments that will define our financial markets in the years to come. ladies and gentlemen. 2017 is bound to bring on a new set of challenges to the global economy with brexit, policy changes in the us under its new president, the us fed ’ s decision to increase policy rates, and china ’ s decision to pursue stability by moderating economic growth. the imf sees some softening from asian emerging markets, but projects a modest growth overall in the world economy. what about the philippines? well, you will be pleased to know that quite a number of multilateral agencies and global institutions expect the philippines to outperform many of our economic peers. nevertheless, we should not be complacent. given the sea change unfolding in the global markets, we need to be strategic in our thinking and deliberate in our collective actions if we are to successfully navigate through emerging challenges. one area where we find challenges and opportunities for us, is the asean integration. if we revisit the underpinnings of asean market integration, we find that its vision is premised literally on the concept of building a community. and like all communities, the asean community is itself built around different components, specifically, developing a political - security community, a socio - cultural community and an economic community.

and efficient payment system is a critical market infrastructure of a stable financial system. the payment system not only provides channels for funds to be transferred among banks and other institutions. it also functions as an essential tool for the effective implementation of monetary policy. it plays a pivotal role in the smooth functioning of money and capital markets. but it is no longer simply the large value payment system – those that has long been recognized as systemically important – that are getting the attention of regulators and policy makers globally. retail payments are increasingly becoming an important piece of the overall infrastructure that rightly warrants our developmental focus. an efficient retail payment system has the potential to transform the economy through the efficiency it brings to business transactions and the savings generated from a shift from paperbased to digital instruments. it benefits the consumers and businesses in terms of the affordability, convenience and speed of payment services – the most basic and most used financial service. this is financial inclusion. given these, the bsp is giving the payment and settlement system the attention it deserves. we recognize that having an efficient payment system is not just about operating infrastructure, but 1 / 3 bis central bankers'speeches also providing an enabling regulatory environment that promotes interoperability, efficiency, and consumer protection. on december 9, 2015, the framework for the national retail payment system ( nrps ) to create a safe, efficient, affordable, and interoperable electronic retail payment system was launched. ultimately, the goal is to increase retail electronic payment transactions to twenty percent ( 20 % ) by 2020 and improve the country ’ s economic competitiveness. realization of this goal requires an enormous collaborative effort among various stakeholders. we have achieved significant progress to date. two automated clearing houses ( ach ) – pesonet and instapay were introduced last november 8, 2017 and april 23, 2018, respectively. both achs provide digital payment solutions to the current payment challenges encountered by government, businesses and ordinary consumers. we have also issued various operating guidelines that promote level playing field and greater participation of smaller players without compromising safety. our current efforts include the development of a national qr code standard to prevent the proliferation of closed loop infrastructures and instead promote interoperability of systems, domestically and even regionally. on the legislative side, we are pursuing measures to support reforms in the payments landscape through the enactment of the payment systems act which provides for the clear mandate of the bsp for the regulation and oversight of the payment system. in order for the financial system