a country ’ s cumulative decisions and actions with respect to debt … it is also wise for a country to institutionalize governance practices that would precisely avoid such a crisis … during a time when such is the least of the country ’ s concerns. the season the philippines is in a good spot today. as can be gleaned from major external debt indicators, the bsp has been successful in its debt management efforts. key ratios such as gross international reserves to short - term debt, outstanding debt to gross national income and debt service to foreign exchange receipts have consistently strengthened, bis central bankers ’ speeches indicating the country ’ s sustained and improving ability to meet maturing obligations. we have recently announced that our gross international reserves have reached an all - time high of us $ 77. 7 billion as of february 2012. relative to short - term debt, our current gir can cover nearly 11 times our short - term debt under the original maturity concept, and about 7 times using the residual maturity concept. at 27. 5pct, our external debt to gdp has been on a downtrend during the past decade. it is now less than half its high over the 10 - year period of 68. 6pct in 2003. likewise, the maturity of our external debt has been lengthened, with close to 90 percent of our external debt being long - term... the average maturity is now about 22 years. the debt service ratio ( or the amount of principal and interest payments due relative to exports of goods and receipts from services and income ) has droppedfrom 15. 7 percent in 2001 to only 8. 4 percent by november 2011, or less than 10 cents per dollar of income. by all indicators, therefore, the philippines is well - positioned to adopt these changes. the champion you may ask, why is the bsp taking on flares? well, quite simply, external debt management is part of our mandate as the central monetary authority. the bangko sentral is mandated by the philippine constitution and other pertinent laws to manage the country ’ s external debt. our objective is to keep outstanding obligations at prudent levels so that these can be comfortably serviced by the economy in an orderly and timely manner. in pursuit of this mandate, the bangko sentral coordinates with other government agencies, and employs various debt management tools. these tools include an approval and registration process which is being implemented by the international operations department, and is instrumental in directing externally - sourced funds to priority areas

bis central bankers'speeches on the other hand, those who choose to “ stay home ” so to speak, are not necessarily shielded from heightened competition. indeed, banks need to have a good competitive strategy even if they are not immediately aspiring to be qabs. we have seen how foreign banks that enter our market reshape competitive forces. aside from qabs, even outside the abif guidelines, foreign banks can still come into our shores under the purview of ra 10641. as you are aware, our strong fundamentals and sound banking system keep the philippines an attractive destination for investments. already, nine foreign banks have entered our banking system thru ra 10641 while another six banks are in various stages of talks with the bsp. abif makes it imperative that you improve your competitiveness by lowering operating costs, increasing product and service innovations, and improving service quality. this requires more investments in technology and training. ultimately, this needs more capital and scale to thrive. the changes that come with asean integration, however, will be akin to a process unfolding. while the framework is already approved, the transition will be gradual. now, then, is the time to consider your options. this is true for non - qabs and for qabs. whether it is backroom support or frontline services, what is certain and necessary from a classic baiphil perspective, is the development and upgrading of skills and training programs not only in banking but also in areas such as market surveillance and regulatory reforms. preferring the status quo will be a competitive disadvantage. change is the reality and banking organizations such as baiphil have a significant role to play in navigating the banking industry toward a new competitive landscape. clearly, much needs to be done ; but i am positive you will be up to these emerging challenges. let me assure you — the bsp is working with the banking community to prepare the way for abif. among others, the bsp has been upgrading the supervision framework in line with international standards, especially on corporate governance and risk management ; requiring capital build - up and encouraging mergers and consolidations ; and opening up barriers to entry. and in accordance with abif, the bsp has signed a high - level agreement with bank negara malaysia governing qabs and looks forward to forging at least two more agreements as early as next month. in addition, our supervision and examination sector and the newly - created office of systemic risk management will engage the