actually grew by 26. 3 percent ( from 991 to 1252 ) between 2010 and 2015 but your branches in 1st to 5th class municipalities grew by 37. 5 percent ( from 304 to 418 ). certainly, the bulk of your branches are still in 1st and 2nd class municipalities but i am encouraged by the expansion elsewhere. what were just 35 branches in 3rd to 5th class municipalities in 2010 are now 73 branches as of end 2015. the numbers may be modest in absolute terms but the pace of growth is not trivial. which brings me back to your conference theme : “ thrift banks : sustaining the momentum for inclusive growth ”. now, a critical question comes to mind - - how can / do thrift banks contribute to inclusive growth? i think with some pragmatism and humility, we would be well - served to “ scope ” the response to this and say that thrift banks play a role in financial inclusion, which promotes inclusive growth. inclusive growth and the role of the thrift banks there are several policy issues which are being considered in the space of financial inclusion. for thrift banks, i think two of these are most relevant. first, we would want to ensure that there is symbiotic relationship between financial inclusion and financial stability. certainly, it defeats our prudential purposes if the attainment of one comes at the expense of the other. here, your expanding footprint strategy is a critical element. as banking services are offered outside of the traditional city - centers, the expectation is that the dynamics between inclusion and stability can very well change. the bsp and the bis are currently writing a paper on the relationship between inclusion and stability to explore the empirical linkages. the preliminary results suggest that information between a bank and its clients as well as the relationship between a bank and other banks in the vicinity do matter. this sounds rather straightforward but the implications on the operations of banks are not simple. in practice, this means each bank must maintain a continuing dialogue with its stakeholders. this kind of transparency is not just “ another disclosure regime ”. rather, it is communication that prevents surprises and allows stakeholders to make informed decisions, avoiding the sharp spikes that often create and / or exacerbate evolving issues. bis central bankers ’ speeches furthermore, banks must be cognizant that stakeholders do look at the localized community of financial service providers. in this day and age of electronic communication and affordable channels, financial consumers demand “ banking services ”, which may no longer

reserves still over usd80 billion, this is sufficient to service more than 10 months ’ worth of imports of goods and payment for services. the exchange rate has sustained its relative competitiveness as it has moved in line with currencies in the region. based on our assessments, therefore, the current stance of monetary policy remains appropriate, but we have flexibility to address developments should there be reason to adjust our policy levers. certainly, the banking industry remains a clear pillar of strength. according to s & p, and i quote, “ philippine banks are looking forward to another solid year in 2016, thanks to the economy ’ s good growth prospects and banks ’ healthy capitalization and asset quality. ” our favorable economic prospects are also noted by fitch ratings, which, for its part, gave the philippines the only positive outlook among asia pacific banking systems for 2016. i am happy to note that thrift banks continue to contribute to the strength of the overall banking industry. the collective assets of tbs reached php961. 13 billion as of november 2015 after growing annually by 10. 71 percent for the past five years. over the same period, deposit balances have been expanding at nearly 11 percent per annum [ php773. 37 billion as of bis central bankers ’ speeches november 2015 ] while loans have grown just below 15 percent annually [ php 681. 41 billion in november 2015 ]. quo vadis? given all of these developments, where do these take the thrift banking industry? the textbook answer, is to follow your mandate under the thrift bank act. under this law, tbs are expected to : 1. promote economic development and expand industrial and agricultural growth ; 2. place within easy reach of the people the medium to long - term credit facilities to agriculture, services, industry and housing at reasonable cost and 3. encourage industry, frugality and the accumulation of savings among the public. while all of you are well aware of these, we all also recognize that these are not trivial tasks and targets. these speak of thrift banks as an enabler of economic development by encouraging retail savings and extending credit to targeted sectors. your mandate makes no distinction of where you are based or the environment within which you operate. this, i feel, is important to highlight because your own business strategy appears to reflect the more “ inclusive ” track of the industry. by this i mean that your branching footprint has clearly extended beyond cities. specifically, the number of thrift bank branches located in cities