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.

end - april 2020. at the same time, banks showed strong liquidity position by ably servicing cash withdrawals and providing needed financing to the economy. the operational risks from possible disruptions in the delivery of financial services was also a concern duly mitigated by the comprehensive business continuity management ( bcm ) system that banks are required to have. finally, the financial consumers ’ shift to digital payments amidst the need to maintain physical hygiene intensified global cyber - and money - laundering - related risks. nevertheless, the bsp, in coordination with other regulators such as the anti - money laundering council, is prepared to conduct investigations and information awareness campaigns to address cyber threats and financial crimes. the volatility, uncertainty, complexity and ambiguity ( voca ) in the economy and financial system has intensified due to this once - in - a - generation crisis. this has further muddled the task of forecasting and budgeting amongst businesses and policy makers. however, we are confident of the banking system ’ s ability to emerge out of this crisis stronger and more resilient. this optimism is shared by the japan credit rating agency ( jcra ), which gave the country ’ s first ever ‘ a ’ credit rating amid global ratings downgrades. among other factors, jcra underscored the strength of the banking system for its ‘ a - ’ rating and stable outlook. non - performing loans ( npl ) is edging up but remain manageable. the adverse impact of the pandemic on borrowers is expected to exert pressure to the current quality of bank loan portfolio. however, we expect the impact to be manageable due to the banking system ’ s sound risk management systems and financial strength built over decades of strategic reforms implemented by the bsp. another factor is the relatively low leverage of the biggest recipients of the banks ’ loans – the corporate borrowers. in fact, the moderate level of private sector debt in the country is one of the reasons why the philippines retained the s & p global ratings ’ banking industry country risk assessment ( bicra ) of 5 ( with rating of 10 as extremely high risk ) in 2020. this rating is among the best in south east asia. stressed cars meeting regulatory standards. our simulation exercises reinforce the banking system and the banking groups ’ capability to weather assumed stressed scenarios with a postshock car of the system and banking groups easily hurdling the 10 percent regulatory minimum. this was achieved as the banking system and banking groups entered the pan