- adequate capitalization and low exposure to bad debts, banks are able to help fund the growing investment requirements in the economy. credit growth, which has settled in the double - digit territory over the last few years, has benefited the productive sectors of the economy. this bodes well for sustained growth. robust lending growth has consistently come along maintenance of good quality of loans, reflecting observance of prudent lending standards. we expect lending growth to continue, especially with the bsp ’ s intention to continue slashing the reserve requirement ratio ( rrr ). should the inflation outlook continue to improve, we will further cut the rrr until it reaches single digit by the end of my term in 2023. as you know, we have room and reason to reduce the rrr as it is currently the highest among select peer countries. rrr is a friction cost, and lowering it is consistent with the aim of further enhancing financial intermediation. in the past, the high rrr had served as an important tool to mop up excess liquidity. but now that the bsp, under its amended charter, has the mandate to issue its own debt securities, we can rely less on the rrr for liquidity management. 2 / 5 bis central bankers'speeches with lower rrr, the banking sector can then lend more support to the economy ’ s growth prospects. it is also important to note that economic growth in the philippines is happening not only in the national capital region ( ncr ) but throughout the country. in fact, growth rates of other regions are outpacing that of the ncr. growth in the regions is expected to remain robust, driven in part by infrastructure development across regions. this pattern of growth is consistent with the aim to make economic growth more inclusive. nevertheless, the bsp will continue to adopt measures that will improve the regulatory and operational environment so that banks will be able to support robust and inclusive economic growth. the financial sector can help spur a more inclusive growth through financial inclusion. we have achieved milestones on financial inclusion as far as regulations are concerned. in fact, the philippines is recognized as having one of the best regulatory environments in the world for financial inclusion. however, many municipalities still do not have banks operating in their areas. a big part of the country ’ s adult population still do not use formal channels to save or borrow money. to enhance financial inclusion, the bsp has implemented several initiatives and are further strengthening its efforts. for instance

forecast of the future, it is nonetheless all about considering all reasonable likely outcomes. some of you may know of the mantra of hyman minsky who once argued that it is in good times when instabilities are developed. this explains in part why crises are often a surprise. sometimes, we see all the gains of better days, but we may be overlooking the underlying signs of vulnerabilities being built up. while it is virtually impossible to forecast the next crisis, its timing and its specific nature, this should not stop us from being prepared. this is the essence of the srcm and it includes technical aspects, some of which the secretariat may share in its presentation, as well as the critical element of communication. we have always believed that highly - aware stakeholders can make well - informed choices. as regulators, however, we also do recognize that system - level outcomes may turn out to be different from the sum of the behaviors of individual stakeholders. all these challenges simply mean that systemic risk crisis management, and invariably financial stability at large, is a collective effort. ladies and gentlemen, the ultimate objective is to improve the welfare of current and future generations. we do that through a well - functioning financial market, interlinked within its various components and collaborating with the rest of the real economy. this srcm that we launched today can be many things at many times to many people, but it will always be about accruing the gains of financial markets, products and services to the filipino people. this srcm is a start, not the terminal goal. thank you and good morning to everyone.