Report on Economic and Financial Developments

Report on Economic and Financial Developments Second Quarter 2020

B A N G K O S E N T R A L N G P I L I P I N A S

Second Quarter 2020 Report on Economic and Financial Developments |i

Report on Economic and Financial Developments – Second Quarter 2020 Table of Contents

Executive Summary ................................................................................................................... 2

Introduction .............................................................................................................................. 4

Real Sector ................................................................................................................................ 5

Aggregate Supply and Demand ................................................................................................... 5

Labor and Employment ............................................................................................................... 7

Fiscal Sector .............................................................................................................................. 9

National Government Cash Operations ...................................................................................... 9

Monetary Sector ..................................................................................................................... 10

Prices ......................................................................................................................................... 10

Domestic Liquidity ..................................................................................................................... 11

Monetary Policy Developments ................................................................................................ 12

Monetary Operations ................................................................................................................ 12

Domestic Interest Rates ............................................................................................................ 13

Financial Sector ....................................................................................................................... 15

Banking System ......................................................................................................................... 15

Banking Policies ......................................................................................................................... 18

Capital Market Reforms ............................................................................................................ 19

Stock Market ............................................................................................................................. 19

Bond Market .............................................................................................................................. 20

Credit Risk Assessment .............................................................................................................. 22

Payments and Settlements System ........................................................................................... 23

External Sector ........................................................................................................................ 24

Balance of Payments ................................................................................................................ 24

International Reserves .............................................................................................................. 28

Exchange Rate ........................................................................................................................... 28

External Debt ............................................................................................................................ 30

Foreign Interest Rates ............................................................................................................... 31

Global Economic Developments ............................................................................................... 33

Financial Condition of the BSP ................................................................................................. 36

Balance Sheet ............................................................................................................................ 36

Income Statement ..................................................................................................................... 36

Conclusion, Challenges and Policy Directions ........................................................................... 37

Annexes .................................................................................................................................. 39

2 | Second Quarter 2020 Report on Economic and Financial Developments

Executive Summary

The domestic economy slowed down further in

Q2 2020. Real gross domestic product (GDP)

declined by 16.5 percent year‐on‐year (y‐o‐y), a

reversal from the 5.4‐percent expansion last year.

This follows the strict community quarantine

measures for the most part of the review quarter to

contain the spread of COVID‐19. The further

deterioration in growth during the quarter brings

real GDP for the first half of 2020 to a 9.0‐percent

contraction. On the production side, the services

and industry sectors decreased by 15.8 percent and

22.9 percent, respectively. On the expenditure side,

household consumption declined by 15.5 percent

while investments (gross capital formation) fell by

53.5 percent.

Labor market weakens. Based on the Labor Force

Survey as of April 2020, unemployment rate surged

to 17.7 percent which translates to 7.3 million

unemployed persons. All the major employment

sectors posted significant declines in the number of

employed persons, reflecting the initial impact of

the community quarantine measures implemented

nationwide.

Fiscal deficit widens during the quarter. The cash

operations of the National Government (NG)

yielded a deficit of ₱474.3 billion in Q2 2020,

equivalent to 11.4 percent of GDP. The Q2 2020

deficit was much higher than the shortfall recorded

in the previous year at 1 percent of GDP. Total NG

revenue was lower at ₱690.2 billion, due to lower

tax collections. Meanwhile, total NG disbursement

reached ₱1,164.5 billion on account of COVID‐19‐

related expenses with the implementation of

health‐related measures and social protection

programs.

Inflation eases in Q2 2020. Headline inflation

decelerated to 2.3 percent y‐o‐y during the review

quarter, lower than 3.0 percent in the comparable

quarter last year. Average inflation in the first half

of the year is at 2.5 percent, well within the NG’s

announced target range of 3.0 percent ± 1.0

percentage point (ppt) for 2020. Core inflation was,

likewise, slower during the review quarter at

2.9 percent y‐o‐y. Food inflation remained steady

during the quarter while non‐food inflation eased

as electricity, gas, and other fuels, as well as

transport inflation continued to decline.

Domestic liquidity remains ample. Money supply

continued to expand, increasing by 14.9 percent

y‐o‐y to about ₱13.6 trillion as of June 2020.

Domestic claims grew by 13.3 percent as credit

extended to the private sector rose, supported by

sustained expansion in bank lending. Net foreign

assets in peso terms likewise grew by 15.7 percent

y‐o‐y as the BSP’s international reserves and

banks’ foreign assets increased.

The BSP reduces key policy rate by a cumulative

100 basis points in Q2 2020. The BSP announced an

off‐cycle policy rate reduction by 50 basis points

(bps) on 16 April 2020 and another follow‐on 50‐bp

rate cut on 25 June 2020. This brings the overnight

reverse repurchase (RRP) rate to 2.25 percent. The

interest rates on the overnight lending and deposit

facilities were likewise lowered accordingly. Latest

baseline forecasts during the quarter indicated that

inflation could settle near the low end of the target

range of 3.0 percent ± 1 ppt for 2020‐2022, with the

balance of risks to the inflation outlook leaning

toward the downside. In deciding to reduce the key

policy interest rate twice during the quarter, the

BSP believes that keeping monetary policy

accommodative will help mitigate downside risks to

growth amid the impact of COVID‐19 pandemic on

the economy.

Domestic interest rates fall during the quarter.

Interest rates in the primary and secondary markets

declined, reflecting high levels of liquidity in the

financial system owing to BSP policy rate cuts and

liquidity‐enhancing measures. Strong demand for

Treasury papers were likewise attributed to

investor preference for safe‐haven assets as well as

Second Quarter 2020 Report on Economic and Financial Developments |3

stable market sentiment during the quarantine

period following the policy measures of the BSP.

Banking system remains sound and stable. Bank

lending expanded at a slightly modest pace of

9.6 percent y‐o‐y as of end‐June 2020 amid limited

operations due to the lockdowns. In terms of asset

quality, the banking system’s gross non‐performing

loan (GNPL) ratio rose slightly to 2.5 percent as of

end‐June 2020 but still below the pre‐Asian crisis

level of 3.5 percent. Moreover, capital adequacy

ratios, both on solo and consolidated basis,

remained well above the BSP’s regulatory threshold

of 10.0 percent and the international standard of

8.0 percent.

Stock market index declines. The Philippine Stock

Exchange index (PSEi) declined by 15.2 percent

quarter‐on‐quarter to average 5,832.17 index

points in Q2 2020. The volatility in trading was due

mainly to expectations of the adverse impact of the

COVID‐19 pandemic on the economy. The negative

performance was tempered partially by the policy

measures of the BSP, the NG’s stimulus package;

and the easing of quarantine measures starting

June.

External position posts higher surplus. The balance

of payment (BOP) position in Q2 2020 recorded a

surplus of US$4.2 billion, higher by US$991 million

from the previous year. The higher BOP position

was attributed mainly to the reversal in the current

account to a surplus, following a substantial

reduction in the trade‐in‐goods deficit.

International reserves increase to record high. The

country’s gross international reserves (GIR) reached

US$93.5 billion as of end‐June 2020. At this level,

the GIR remains adequate as it can cover 8.5

months’ worth of imports of goods and payments

of services and primary income. It is also equivalent

to 7.0 times the country’s short‐term external debt

based on original maturity and 4.6 times based on

residual maturity.

External debt remains manageable. Outstanding

external debt stood higher at US$87.5 billion as of

end‐June 2020 from the quarter‐ago level of

US$81.4 billion. The rise in debt stock was due

mainly to higher external borrowings to fund the

financing requirements of the pandemic response

programs. Nevertheless, external debt maturity

profile remained predominantly medium‐ to long‐

term. The debt service ratio (DSR) increased slightly

to 7.8 percent from 7.7 percent a year ago. In terms

of solvency ratios, external debt to GDP ratio

increased to 23.7 percent due in part to the

contraction in GDP during the review quarter.

Philippine peso appreciates against the US dollar.

The peso averaged ₱50.45/US$1 in Q2 2020,

appreciating by 0.75 percent, quarter‐on‐quarter.

The peso’s strength was supported by positive

market view given the country’s macroeconomic

fundamentals, which include the manageable

inflation environment, a strong and resilient

banking system, prudent fiscal position, and a high

level of international reserve buffer.

Global economic conditions deteriorate. The

impact of the pandemic on the global economy in

Q2 2020 was larger‐than‐anticipated and the

recovery path could be slower than what was

previously forecasted. The persistent deterioration

in domestic and global financial conditions, greater

disruptions in the supply chain, shifts in spending

patterns, decline in consumer and business

confidence, among others, point to synchronized

downturns in advanced economies and deeper

growth slowdowns in emerging market and

developing economies. The IMF (2020) noted that

while reopening of the economy requires the

gradual unwinding of targeted policies, stimulus

measures must continue to be implemented to

support demand and keep businesses afloat.


Introduction The Philippine economy is currently being tested by

the unprecedented impact of the health crisis

brought on by the COVID‐19 pandemic. The

negative GDP growth for two consecutive quarters

has placed the country in a technical recession due

mainly to the implementation of strict lockdown

measures in April‐May 2020 to contain the spread

of the virus. As a result, major sectors in the

economy from both the supply and demand side

were adversely affected.

Unemployment rate as of April 2020 surged as the

number of employed persons, mostly from the

services and industry sectors, declined

substantially, pointing to a possible slack in the

economy going forward. At the same time, inflation

during the review quarter eased from the year‐ and

quarter‐ago averages, in large part due to the

significant fall in global oil prices. Moreover,

outlook for inflation in 2020 is seen to be benign

but well within the NG target range of 3.0 percent ±

1.0 ppt for 2020.

Government spending, on the other hand,

increased considerably as the pandemic response

necessitated additional budgetary support for

health and social welfare programs. As a result, the

fiscal deficit widened in Q2 as revenue collection

weakened against higher expenditure requirement.

Nevertheless, past fiscal prudence provides

sufficient space for the NG to pursue an

expansionary policy in order to effectively address

the health and economic impact of the pandemic.

For its part, the BSP implemented prompt and

decisive monetary policy actions during the review

quarter to ensure the smooth functioning of the

financial market amid the lockdowns and provide

support to the economy. The BSP reduced its key

policy rate by a cumulative 100 bps in Q2 and

implemented liquidity‐enhancing measures that are

expected to lower borrowing costs and support

credit availability. Moreover, the BSP relaxed

certain regulatory rules to allow banks to exercise

forbearance on affected clients.

The sound macroeconomic fundamentals that the

country has nurtured in the past years are currently

seen to provide buffers to the economy. Growth in

bank lending moderated but asset quality remained

intact. Moreover, the banking system continues to

be stable, owing to sufficient capitalization and

manageable loan exposure and coverage to absorb

the unexpected losses.

External payments position likewise remained

manageable. International reserves stood at record

high as of June 2020, indicating ample external

liquidity buffer, which can cushion the domestic

economy against external shocks. At the same time,

external debt continued to be manageable, with a

debt profile composed largely of medium‐ to long‐

term (MLT) maturities.

Lockdown measures were gradually eased toward

the end of Q2. However, there is still the challenge

of keeping the virus contagion in control to

transition safely towards economic reopening and

recovery. To do so, a whole‐of‐government

approach have been adopted with both fiscal and

monetary policy levers optimized to prevent

economic scarring and restore the economy back to

its growth path.


Real Sector Aggregate Supply and Demand

The Philippine economy declined by 16.5 percent

in Q2 2020, a reversal from the 5.4‐percent growth

registered in Q2 2019 and further deterioration

from the 0.7‐percent contraction1 in Q1 2020.

Domestic economy further slows down in Q2 2020

The record‐low2 Q2 2020 real GDP was due mainly

to the adverse impact of the unprecedented health

crisis, particularly the implementation of stringent

and prolonged community quarantine measures to

help mitigate the spread of the coronavirus

disease (COVID‐19).

Chart 1. Gross Domestic Product and Gross National Income annual growth rate in percent; at constant 2018 prices

On the supply side, the services and industry

sectors registered double‐digit contractions by

15.8 percent and 22.9 percent, respectively, due

to the closure of businesses and firms amid

the pandemic. Meanwhile, the agriculture, fishery

and forestry (AFF) sector posted a positive

performance with a 1.6‐percent expansion, driven

mainly by the 7.2‐percent increase in palay

production supported by the implementation

of the Rice Competitiveness Enhancement Fund

(RCEF) under the Rice Tariffication Law. On the

1 Downward revision from the preliminary data of ‐0.2 percent. 2 Lowest recorded quarterly GDP since the 1981 national accounts was released.

demand side, the loss of income and lingering

uncertainty led to the significant decline in

household consumption and private sector

investment by 15.5 percent and 53.5 percent,

respectively. Nonetheless, the NG ramped up

spending by 22.1 percent in line with its COVID‐19

response strategy.

The Q2 2020 GDP outturn resulted in a cumulative

contraction of 9.0 percent in the first semester. The

NG remains optimistic that economic recovery will

start in the second half of the year. On 28 July

2020, the Development Budget Coordination

Committee (DBCC) adjusted its 2020 GDP projection

to ‐5.5 percent (or ‐4.5 to ‐6.6 percent) from ‐2.0 to

‐3.4 percent following revised estimates on the

impact of the COVID‐19 pandemic on tourism,

trade, and remittances throughout the year.3

GDP by industry

The services sector declined by 15.8 percent from

the year‐ and quarter‐ago growth rates of

7.5 percent and 0.6 percent, respectively (Table 1).

Accounting for 62.3 percent of GDP, the services

sector contributed largely to the decline with

‐9.7 percentage points. The prolonged enhanced

community quarantine (ECQ) and the modified ECQ

implemented during the review quarter affected

the transportation and storage subsector as all

land, sea, and air transport services were

suspended during the period, posting a decline

of 55.7 percent from the 11.1‐percent drop in

Q1 2020. Moreover, accommodation and food

service activities further declined by 68.0 percent

from the 16.4‐percent contraction in Q1 2020, due

mainly to the “stay‐at‐home” measures

implemented to contain the spread of COVID‐19

and limited business operations. Wholesale and

retail trade, repair of motor vehicles and

motorcycles, which accounted for the bulk (or

29.1 percent) of the services sector, declined by

13.7 percent, a reversal from the 8.6‐percent

expansion during the same period in 2019 and

1.9 percent increase in the previous quarter. This

is attributed to the closure of businesses (including

3 Department of Budget Management (DBM) Press Release, “DBCC Revisits Macroeconomic Assumptions and Fiscal Program for the 2021 President’s Budget, dated 6 August 2020”.

‐20‐18‐16‐14‐12‐10‐8‐6‐4‐202468

1012

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

GDP GNI

Source: Philippine Statistics Authority (PSA)


temporary shutdowns) during the imposition of

quarantines.

Chart 2. Gross Domestic Product, by Industry annual growth rate in percent; at constant 2018 prices

In contrast, the financial and insurance activities as

well as the information and communication

subsector posted growth rates at 6.8 percent and

6.6 percent, respectively. These subsectors

continued to operate during the ECQ due to the

essential nature of their services, particularly in the

aspect of e‐commerce. In the new normal scenario,

e‐commerce is expected to continue to play a big

role as businesses and consumers shift to online

transactions such as the expanded use of cashless

payment systems and other financial technology

platforms.

The industry sector exhibited the steepest decline

at 22.9 percent in Q2 2020, much lower than the

3.4‐percent contraction in Q1 2020 and a reversal

from the 2.5‐percent expansion in Q2 2019.

The decline in the sector slashed 6.9 ppts off the

overall GDP. The manufacturing subsector further

contracted by 21.3 percent from the 3.8‐percent

decline in Q1 2020, dragged by the double‐digit

contraction in almost all subsectors due to

restricted business operations, particularly on non‐

essential goods and low domestic demand.

Meanwhile, construction subsector remained in the

negative territory as it declined by 33.5 percent,

lower than the 0.1 percent and 2.9 percent

contractions seen in Q2 2019 and Q1 2020,

respectively. Construction projects by both public

and private sectors were suspended during the ECQ

and were only allowed under the general

community quarantine (GCQ). On the other hand,

4 Statement by Karl Kendrick T. Chua, Acting Socioeconomic Planning Secretary on 2020 Q2 Performance of the Philippine Economy, dated 6 August 2020.

manufacture of basic pharmaceutical products and

pharmaceutical preparations grew by 7.7 percent,

albeit slower than the double‐digit growth of

20.6 percent and 27.3 percent in Q2 2019 and

Q1 2020, respectively. Looking ahead, there are

indications of recovery for the industry sector.

The volume of production index was ‐39.0 percent

in April but improved to ‐19.0 percent by June. This

is expected to gradually improve in the succeeding

months.4

The AFF sector grew by 1.6 percent, faster than

the 0.7‐percent expansion in Q2 2019 and a

reversal from the 0.3‐percent decline in Q1 2020.

After eight consecutive quarters of contraction

which started in Q2 2017, palay production rose by

7.2 percent, following the implementation

of the RCEF under the Rice Tariffication Law.

Other high performing crops during the quarter

were corn (15.6 percent in Q2 2020 from

‐4.4 percent in Q1 2020), sugarcane (76.0 percent

from 8.9 percent), and rubber (12.1 percent from

nil growth). However, livestock continued to be

challenged by the African Swine Fever, reducing its

production by 8.2 percent compared with the 3.3

percent and 1.5 percent growth in Q2 2019

and Q1 2020, respectively. According to the

Department of Agriculture (DA), agriculture,

alongside the construction industry, will be the

most strategic sector for economic recovery. Aside

from the revival of economic activity, ensuring food

security should be the utmost concern of the

government at the height of the health crisis.5

GDP by expenditure

On the expenditure side, the Q2 2020 GDP output

was pulled down by further contraction in

gross capital formation triggered mainly by the

suspension in the implementation of major

infrastructure projects in compliance with the

ECQ guidelines. Moreover, household

consumption, which has been a growth driver, fell

significantly due to the loss of income as well as the

compliance to “stay‐at‐home” measures to contain

the spread of COVID‐19.

5 DA Press Release, “Agri sector posts 1.6 percent growth in Q2, paves way to perk up Phl economy”, dated 7 August 2020.

‐26‐24‐22‐20‐18‐16‐14‐12‐10‐8‐6‐4‐202468

10121416

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Agriculture

Industry

Services

Source: PSA


Chart 3. Gross Domestic Product, by Expenditure annual growth rate in percent; at constant 2018 prices

Household spending significantly decreased by

15.5 percent, a reversal from the expansion

recorded in Q2 2019 and Q1 2020 at 5.6 percent

and 0.2 percent, respectively (Table 1a). This was a

record‐low as consumers reduced their spending

due mainly to job losses and lay‐offs.

Transportation spending, which is one of the key

household expenditure items, contracted by

60.5 percent due largely to the suspension of

public transportation during the stringent

quarantine period as well as the implementation of

alternative working arrangements by firms. The

other subsectors that posted large declines during

the review quarter were restaurants and hotels

(‐66.4 percent in Q2 2020 from 14.3 percent

in Q1 2020), recreation and culture (‐57.2 percent

from ‐5.7 percent), and clothing and footwear

(‐40.2 percent from 0.1 percent). On the other

hand, housing, water, electricity, gas and other

fuels as well as food and non‐alcoholic beverages

increased by 6.6 percent and 2.4 percent,

respectively.

Government expenditures grew by 22.1 percent,

much higher than the year‐ago and quarter‐ago

growth rates of 6.8 percent and 7.0 percent,

respectively. This is in accordance with the

COVID‐19 response strategy through provision of

social welfare support to low‐income households

and wage subsidy to small business workers.

Gross capital formation further declined in Q2 2020

by 53.5 percent from the 17.4‐contraction in the

previous quarter and 0.8‐percent contraction in

the same period last year. This is attributed to the

62.1‐percent drop in durable equipment and 32.9‐

percent contraction in construction amid the

subdued business sentiment as well as the delay in

the roll‐out of infrastructure projects in compliance

with the rules under the ECQ. Nevertheless, public

construction was ramped up when the restrictions

were lifted under the general community

quarantine which started on 1 June 2020.

International trade continued to face a challenging

environment due to limited economic activity

related to the pandemic, as well as ongoing

geopolitical conflicts and trade tensions among

major economies. Exports posted a double‐digit

contraction of 37.0 percent in Q2 2020 from the

3.1‐percent growth recorded in Q2 2019 and

4.4‐ percent decline in Q1 2020. A larger

contraction of 40.0 percent was recorded for

imports, narrowing the country’s trade deficit

during the review quarter. This is also the fourth

consecutive quarter of negative performance for

imports. Net exports contributed 4.9 ppts to the

Q2 2020 GDP outturn.

Due to the significant economic impact of the

ongoing pandemic, the NG is rebalancing its

strategy to save lives as well as the livelihood of

Filipinos. Under Pillar 1 and 2 of the COVID‐19

response strategy, the NG provided support to

vulnerable groups/individuals and expanded

medical resources to fight COVID‐19. Furthermore,

the signing of the Bayanihan to Recover As One

Law (Bayanihan 2) on 11 September 2020 and

the anticipation of the passage of the Corporate

Recovery and Tax Incentives for Enterprises

(CREATE) Act will help enable the country to

recover in the next semester along with the gradual

reopening of the economy. This is consistent with

Pillar 3 of the COVID‐19 response strategy i.e.,

to finance emergency initiatives and keep the

economy afloat through fiscal and monetary

actions, while Pillar 4 maps out an economic

recovery plan to create jobs and sustain growth.

Labor and Employment

The number of employed persons reached

33.8 million in April 2020, a 20.8‐percent reduction

from 42.7 million in January 2020, based on the

preliminary results of the April 2020 Labor Force

‐60‐55‐50‐45‐40‐35‐30‐25‐20‐15‐10‐505

101520253035

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

HH Consumption

Govt Spending

Capital Formation

Source: PSA


Survey (LFS)6 (Table 2). The employment situation

in the April 2020 reflects the initial impact of the

community quarantine measures implemented

nationwide amid the COVID‐19 pandemic.

Labor market conditions deteriorate in April 2020

In April 2020, all the major employment sectors

posted large declines in the number of employed

persons. Employment in the services sector

decreased by 22.8 percent (‐5.7 million workers)

with large employment losses in the following

subsectors: wholesale and retail trade; repair

of motor vehicles and motorcycles services

(‐2.2 million workers); transportation and

storage (‐825,000 workers); accommodation

and food service activities (‐790,000 workers);

other service activities (‐558,200 workers);

public administration and defense; compulsory

social security (‐307,100 workers); and education

(‐221,900 workers), to name a few. Likewise,

employment in the industry sector declined

significantly by 28.2 percent (‐2.3 million workers)

due mainly to employment losses in the

construction (‐1.2 million workers) and

manufacturing sub‐sectors (940,300 workers).

Employment in the agriculture sector also fell

by 9.5 percent (‐920,900 workers). Of the total

employed persons, the services sector accounted

for the largest share at 57.1 percent, followed by

the agriculture sector at 25.9 percent, and the

industry sector at 17.0 percent.

Employed persons are categorized into: (1) wage

and salary workers; (2) self‐employed workers

without any paid employee; (3) employers in own

family‐operated farm or business; and (4) unpaid

family workers. Among the wage and salary

workers, employment losses were registered

in those who worked in private establishments

(‐5.7 million workers), in government/government

corporation (‐411,800 workers), in private

households (‐301,700 workers), and those workers

with pay in own family‐operated farm or business

6 Released on 5 June 2020 7 Those who worked for 40 hours or more during the reference week are considered full‐time workers, while those who worked for less than 40 hours are considered part‐time workers.

(‐18,800 workers). Similarly, employment reduction

was posted in self‐employed workers without any

paid employee (‐1.5 million workers), unpaid family

workers (‐528,700 workers), and employers in own

family‐operated farm or business (‐394,500

workers). Of the total employed, wage and salary

workers made up 63.2 percent, self‐employed

comprised 28.7 percent, unpaid family workers

accounted for 6.3 percent, and workers in own

family‐operated farm or business accounted for

the remaining 1.8 percent.

Workers are also classified as either full‐time or

part‐time workers.7 As reported in the April 2020

LFS, the number of full‐time workers decreased by

65.8 percent (‐19.0 million workers) while the

number of part‐time workers fell by 18.9 percent

vis‐à‐vis the January 2020 LFS. Full‐time workers

represent two‐thirds of the total employed, while

the remaining one‐third are part‐time workers.

Meanwhile, the number of workers with jobs

but not at work8 reached 13.0 million.

The unemployment rate in April 2020 was

estimated at 17.7 percent, 12.4 ppts higher than

5.3 percent in the January 2020 LFS. Of the

7.3 million unemployed, most of them were males

(67.0 percent), aged between 25 to 34 years old

(31.6 percent), and have completed junior high

school9 (30.3 percent).

Chart 4. Unemployment and Underemployment Rates in percent

8 “With a job but not at work” are those who have a job or business but are not at work because of temporary illness/injury, on vacation, or other reasons. 9 Per PSA, graduates of junior high school include those high school graduates in the old curriculum.

10

12

14

16

18

20

22

0

2

4

6

8

10

12

14

16

18

20

Jan2017

Apr Jul Oct Jan2018

Apr Jul Oct Jan2019

Apr Jul Oct Jan2020

Apr

Unemployment (LHS) Underemployment (RHS)

Source: Labor Force Survey (LFS) ‐ PSA


The underemployment10 rate also rose by 4.1 ppts

to 18.9 percent in Apr 2020 LFS from 14.8 percent

in January 2020 LFS. By hours worked in a week,

the visibly underemployed persons (part‐time

workers) comprised 61.7 percent of the total

underemployed, while the invisibly underemployed

persons (full‐time workers) comprised 38.3 percent.

By sector, underemployed workers in the services

sector comprised 48.8 percent of the total

underemployed, while those in the agriculture

and industry sectors comprised 33.8 percent and

17.4 percent, respectively.

The labor force participation rate (LFPR)11 dropped

to 55.6 percent in April 2020, 6.1 ppts lower than

the 61.7 percent in January 2020 LFPR. This is

attributed to the increased number of household

population 15 years old and over against the

number of workers who were not able to join

the labor force.

Fiscal Sector National Government Cash Operations

The cash operations of the NG yielded a deficit

of ₱474.3 billion in Q2 2020, a reversal from

the year‐ago surplus level of ₱47.6 billion.

The NG’s fiscal deficit for Q2 2020 was equivalent

to ‐11.4 percent of GDP, a reversal from the

1.0 percent deficit ratio registered in Q2 2019

(Table 3).

NG cash operations post larger deficit

Total NG revenues for Q2 2020 reached

₱690.2 billion, 19.7 percent lower than the

Q2 2019 level of ₱859.8 billion. Total revenues

10 Underemployment refers to those employed persons who express the desire to have additional hours of work in their present job, or to have additional job, or to have a new job with longer working hours. Those who work for less than 40 hours in a week are called visibly underemployed persons, while those who worked for more than 40 hours in a week are called invisibly underemployed persons.

as a share of GDP was recorded at 16.6 percent

in Q2 2020, lower than the Q2 2019 share of

17.7 percent. The y‐o‐y decline in revenues was

due mainly to decreased collections by the

Bureau of Customs (BOC) and Bureau of Internal

Revenue (BIR) by 33.1 percent and 18.5 percent,

respectively. Tax collections, which constituted

86.3 percent of total revenues, amounted to

₱595.5 billion, 22.2 percent lower than the

comparable figure a year ago. Non‐tax revenues,

which consisted mainly of collections made by the

Bureau of the Treasury (BTr), slightly decreased by

0.1 percent y‐o‐y to reach ₱94.7 billion.

Meanwhile, total NG expenditures in Q2 2020

reached ₱1,164.5 billion, 43.4 percent higher

than the ₱812.2 billion expenditures in Q2 2019.

Relative to the size of the economy, total NG

disbursements was recorded at 28.1 percent of

GDP in Q2 2020, an increase from the previous

year’s ratio of 16.7 percent. Spending for the

period was primarily on account of COVID‐19‐

related expenditures at the height of the ECQ

imposition, with the implementation of

health‐related measures and social protection

programs to safeguard the public, particularly

the vulnerable sectors.12

Chart 5. Cash Operations of the National Government in billion pesos

Netting out the interest payments from total

expenditures, the resulting primary deficit

amounted to ₱406.5 billion, representing

11 LFPR refers to the percentage of the total number of persons in the labor force to the total population 15 years old and over. The labor force consists of employed and unemployed persons. 12 National Government Disbursement Performance, June 2020, DBM.

‐600

‐500

‐400

‐300

‐200

‐100

0

100

200

300

400

400

500

600

700

800

900

1,000

1,100

1,200

1,300

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Surplus/(Deficit) (RHS)

Revenues (LHS)

Expenditures (LHS)

Source: Bureau of the Treasury (BTr)


‐9.8 percent of GDP during the review quarter.

In terms of financing the deficit, the NG incurred

net borrowings in Q2 2020 of ₱747.4 billion mostly

coming from domestic sources.

Fiscal discipline has generated sufficient fiscal space

which can be allocated mainly into funding social

protection programs as well as economic stimulus

measures against the widespread and profound

impact of the COVID‐19 pandemic.

Monetary Sector

Prices

Headline inflation. Headline inflation decelerated

to 2.3 percent y‐o‐y in Q2 2020, lower than

3.0 percent and 2.7 percent recorded in the

previous year and quarter, respectively (Table 4).

Headline inflation eases in Q2 2020

This resulted in an average inflation of 2.5 percent

in the first half of 2020, which was within the NG’s

announced target range of 3.0 percent ± 1.0 ppt

for the year.

Core inflation. Likewise, core inflation—which

excludes selected volatile food and energy items

to measure underlying price pressures—also

slowed down to 2.9 percent y‐o‐y in Q2 2020 from

3.4 percent in the same period a year ago and

3.2 percent in the previous quarter. Similarly, the

alternative measures of core inflation were lower

from their quarter‐ and year‐ago rates except for

the net of volatile items which was higher relative

to the previous year.13

13 Trimmed mean, weighted median and net of volatile items are

Table A. Alternative Core Inflation Measures (2012=100) in percent

Food inflation rate in the Philippines was steady at

3.0 percent y‐o‐y in Q2 2020 relative to the

previous year but was higher than the 2.3 percent

recorded in the previous quarter. Key food items

such as rice, corn and sugar, jam, honey, chocolate

and confectionery posted less negative inflation

rates while y‐o‐y inflation for milk, cheese and eggs,

oils and fats, and fruits accelerated in Q2 2020.

Quarantine measures impeding farming and trading

activities and transport problem of food items

exerted upward pressure on food prices during

the quarter. Meanwhile, non‐alcoholic beverages

eased to 2.6 percent during the review quarter

from 5.1 percent in Q2 2019 and 2.8 percent in

Q1 2020.

Chart 6. Food and Non‐Food Inflation in the Philippines (2012=100) in percent

Non‐food inflation rate eased in Q2 2020 to

1.0 percent from 2.6 percent a year ago and

2.1 percent in the previous quarter. Inflation for

housing, water, electricity, gas, and other fuels

decelerated as the price index of electricity, gas,

and other fuels continued to decline on a y‐o‐y

BSP‐computed alternative measures for core inflation.

Q2 2019 Q1 2020 Q2 2020

Official Core Inflation 3.4 3.2 2.9

Trimmed Mean 1 2.9 2.2 2.1

Weighted Median 2 3.0 2.6 2.3

Net of Volatile Items 3 3.0 3.8 3.5

1 The trimmed mean represents the average inflation rate of the (weighted) middle 70 percen

in a lowest‐to‐highest ranking of year‐on‐year inflation rates for all CPI components.2 The weighted median represents the middle inflation rate (corresponding to a cumulative

CPI weight of 50 percent) in a lowest‐to‐highest ranking of year‐on‐year inflation rates.3 The net of volatile items method excludes the following items: bread and cereals, vegetable

sugar, jam, honey, chocolate, and confectionery, electricity, gas, fuel and lubricants for

personal transport equipment, and passenger transport by road, which represents

29.5 percent of all items.

Source: PSA, BSP estimates

‐2

‐1

0

1

2

3

4

5

6

7

8

9

10

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Headline Inflation

Food Inflation

Non‐Food Inflation

Source: PSA


basis and at a faster pace relative to the previous

quarters. At the same time, the decline in the

transport inflation following the significant drop in

global oil prices, was tempered slightly by the

higher inflation for transport services from the

tricycle fare hike implemented during the quarter.

In terms of geographical location, inflation rate

in the NCR slowed to 1.5 percent y‐o‐y in Q2 2020

from 3.2 percent in the same period a year ago

and 2.1 percent in the previous quarter (Table 4a)

due largely to lower inflation rates for both

food and non‐food tems. Food inflation in the

NCR slowed down to 3.0 percent in Q2 2020

from 3.6 percent and 3.5 percent a year‐ and

quarter‐ago, respectively. Meanwhile, non‐food

inflation decelerated to 0.5 percent in Q2 2020

from 3.0 percent and 1.2 pecent in the previous

year and quarter, respectively.

Chart 7. Inflation Rate by Region (2012=100)

in percent

Inflation in areas outside NCR (AONCR) fell to

2.5 percent y‐o‐y in Q2 2020 from 2.8 percent a

year‐ and quarter‐ago (Table 4b). Food inflation in

AONCR rose to 3.1 percent during the review

quarter from the year‐ and quarter‐ago’s rates of

2.7 percent and 2.0 percent, respectively, while

non‐food inflation in AONCR eased to 1.1 percent

in Q2 2020 from 2.4 percent in Q2 2019 and

2.5 percent in Q1 2020.

14The indicators used for money supply are: M1 (or narrow money), comprised of currency in circulation and demand deposits; M2, composed of M1 plus savings and time deposits (quasi‐money); M3, consisting of M2 plus deposit substitutes; and M4, consisting of M3 plus foreign currency deposits.

Domestic Liquidity14

Money supply or M3 grew by 14.9 percent y‐o‐y as

of end‐June 2020 to about P13.6 trillion, faster than

the 13.3‐percent expansion as of end‐March 2020

(Table 5).

Domestic liquidity remains ample

The expansion in M3 was driven by the

15.7‐percent y‐o‐y growth in net foreign assets

and the 13.3‐percent growth in domestic claims

in June 2020. Credit extended to the private sector

rose by 7.2 percent, supported by the sustained

expansion in bank lending. Meanwhile, net claims

on the central government grew by 53.2 percent

from a 21.6‐percent expansion as of end‐March

2020.

Table B. Domestic Liquidity (M3)

Net foreign assets (NFA) in peso terms grew by

15.7 percent y‐o‐y in June 2020. The BSP’s NFA

position continued to expand during the quarter,

reflecting the sustained growth of gross

international reserves. The NFA of banks also

expanded as growth in banks’ foreign assets rose

on account of higher interbank loans, deposits with

other banks, and investments in marketable

securities. Meanwhile, the growth of M4, a broader

concept of domestic liquidity comprising broad

money liabilities and foreign currency deposits of

residents, rose to 13.3 percent y‐o‐y in June 2020

from 12.1 percent in March 2020.

0

1

2

3

4

5

6

7

8

9

10

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Philippines

National Capital Region

Areas Outside the National Capital Region

Source: PSA

Jun 2020rMar 2020

r Jun 2019 Q‐o‐Q Y‐o‐Y

Domestic Liquidity (M3) 13,561.6 13,127.5 11,801.6 3.3 14.9of which:

Net Foreign Assets 5,481.2 5,149.6 4,738.9 6.4 15.7

Domestic Claims 13,603.1 13,195.9 12,006.7 3.1 13.3of which:

Net Claims on Central Government 2,681.2 2,166.9 1,750.6 23.7 53.2

Claims on the Private Sector 9,427.3 9,503.5 8,793.1 ‐0.8 7.2

rRevi sed

Source: BSP

PARTICULARS

Growth Rates (in percent)

Levels (in bi l l ion pesos )


Monetary Policy Developments

On 16 April 2020, the BSP announced an off‐cycle

key policy rate reduction by 50 basis points (bps) to

2.75 percent for the overnight reverse repurchase

or RRP facility. Moreover, in the 25‐June monetary

policy meeting, the BSP decided to cut the policy

rate anew by another 50 bps to 2.25 percent. The

interest rates on the overnight lending and deposit

facilities were likewise lowered accordingly.

The BSP reduces policy rate by a cumulative 100 bps in Q2

In deciding to reduce the key policy interest rate

twice during the review quarter, the BSP assessed

the impact of the COVID‐19 pandemic on the

Philippine economy.

Chart 8. BSP Policy Rates

in percent

Latest baseline forecasts during the review period

indicate that inflation could settle near the low end

of the target range of 3.0 percent ± 1 ppt for 2020

up to 2022, with inflation expectations remaining

firmly anchored over the policy horizon.

Meanwhile, the balance of risks to the inflation

outlook leans toward the downside from 2020 up

to 2022 owing largely to the potential impact of a

deeper and more disruptive pandemic on domestic

and global demand conditions.

The BSP observed that domestic economic activity

has slowed with the enforcement of necessary

protocols to slow the spread of the virus in the

country. Equally important, the outlook for global

growth has deteriorated further as considerable

uncertainty still surrounds the extent of the health

crisis. The BSP noted that even as economies begin

to reopen, the global recovery would likely be

protracted and uneven. Hence, there remains a

critical need for continuing measures to bolster

economic activity and support financial conditions,

especially the effective implementation of

interventions to protect human health, boost

agricultural productivity and build infrastructure.

Given these considerations, the BSP decided that

a reduction in the policy rate amidst a benign

inflation environment would help mitigate the

downside risks to growth and boost market

confidence. Even as domestic liquidity dynamics

and market function continue to improve owing

to prior liquidity‐enhancing measures, the BSP

believes that keeping an accommodative stance

will further ease the cost of borrowing and ensure

ample credit and liquidity in the financial system

as the economy transitions toward recovery in

the coming months.

Going forward, the BSP reiterates its support for

the health and fiscal programs already being rolled

out by the National Government in responding to

the needs of Filipino households and businesses.

The BSP remains committed to deploying its full

range of monetary instruments and regulatory

relief measures as needed in fulfillment of its

mandate to promote non‐inflationary and

sustainable growth.

Monetary Operations

As of end‐Q2 2020, total outstanding amount

absorbed in the BSP liquidity facilities stood at

₱1.5 trillion. Bulk of the BSP’s liquidity‐absorbing

monetary operations had been through the

overnight deposit facility (ODF), comprising about

73.3 percent of the total outstanding amount.

Meanwhile, placements in the term deposit facility

(TDF) and RRP facility each made up 13.4 percent.

The BSP calibrated its monetary operations to

ensure adequate short‐term peso liquidity in the

financial system and support the smooth flow of

0

1

2

3

4

5

6

7

Mar2017

Jun Sep Dec Mar2018

Jun Sep Dec Mar2019

Jun Sep Dec Mar2020

Jun

Overnight RRP Rate

Overnight RP Rate

Overnight Deposit Facility Rate


funding to businesses and households amid the

implementation of quarantine protocols in

response to the COVID‐19 pandemic. To this end,

there were no offerings in the TDF for 1 and 8 April

2020. In addition, beginning 8 April, the daily RRP

volume offering was reduced to P100 billion

(from ₱305 billion). The BSP gradually reopened

the TDF by offering the 7‐day and 14‐day tenors

on 15 April and 10 June, respectively, while the

daily RRP offer volume was increased to

₱200 billion on 10 June.

The reduced TDF operations in Q2 2020 resulted

in lower average weekly offer volume at about

₱131.5 billion for the period 15 April‐24 June

relative to the previous quarter’s ₱151.8 billion.

Meanwhile, average bid‐to‐cover ratios for the

7‐day and 14‐day tenors were higher at 2.4 and

3.1 compared to 1.4 and 1.5, respectively, in

the previous quarter. Similarly, the average

bid‐to‐cover ratio for the daily RRP auction

increased significantly to around 5.2 during

the quarter from 1.7 in Q1 2020.

For the standing facilities, there were a few

availments in the overnight lending facility (OLF)

in the first half of April but at minimal amounts

only. Meanwhile average daily placements in the

ODF in Q2 2020 was at about P560.25 billion,

higher than ₱226.56 billion in the previous quarter.

Domestic Interest Rates

Lower primary market rates in Q2 2020 reflected

high levels of liquidity in the financial system owing

to BSP policy rate cuts and liquidity‐enhancing

measures, as well as strong demand for safe‐haven

government securities (GS) amid market

uncertainty over the economic impact of COVID‐19.

Primary market interest rates decline

The 91‐day, 182‐day and 364‐day Treasury bill

(T‐bill) rates in the primary market fell to

2.52 percent, 2.52 percent and 2.66 percent from

the Q1 2020 rates of 3.16 percent, 3.45 percent and

3.79 percent, respectively (Table 6). The NG also

started to offer a 35‐day security during the quarter

in view of market preference for shorter‐tenors,

which fetched a yield of 2.10 percent.

Chart 9. Treasury Bill Rates in percent

Likewise, interest rates in the secondary market

declined in end‐June 2020 relative to end‐March

2020, indicating ample liquidity conditions and

stable market sentiment during the quarantine

period following the implementation of BSP

liquidity‐enhancing measures.

Yields in the secondary market GS fall across the board

Yields across all GS maturities fell by a range of

138.7 bps (3‐month) to 230 bps (2‐year).

Chart 10. Yield Curve of Government Securities in percent

Interest rates on the 7‐day and 14‐day TDFs

declined in Q2 2020 by 168.99 bps and 173.35 bps

to settle at 2.28 percent and 2.25 percent,

respectively.

Rates in the BSP’s term deposit facility decline

0

1

2

3

4

5

6

7

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

91‐day T‐bill Rate



Source: BTr

0

1

2

3

4

5

6

7

3Mo 6Mo 1Yr 2Yr 3yr 4Yr 5Yr 7Yr 10Yr 20Yr 25Yr

Q2 2019 Q1 2020 Q2 2020

Source: BSP


This reflected BSP policy rate cuts during the

quarter as well as ample liquidity in the financial

system. The BSP 28‐day TDF facility remained close

to help ensure ample liquidity and stable funding

conditions amid the prolonged enforcement of

community quarantine measures.

The differentials (gross and net of tax) between

the domestic and US interest rates generally

widened in Q2 2020 relative to Q1 2020.

Interest rate differentials widen

The average RP 91‐day T‐bill, the US 90‐day London

Interbank Offered Rate (LIBOR) and the US 90‐day

T‐bill rates fell by 66.51 bps to 2.47 percent,

93.15 bps to 0.60 percent and 92.84 bps to


Chart 11. Interest Rate Differentials quarterly averages; in basis points

The wider differential, despite the policy rate cuts

by the BSP during the quarter, reflected the larger

decline in foreign interest rates as the US Fed hit

the zero‐lower bound amid growing concerns on

the growth prospects of the US as domestic

COVID‐19 cases continued to surge.

The positive differential between the BSP's policy

interest rate (overnight borrowing or RRP rate) and

the US Federal Funds target rate decreased to 200

bps as of end‐June 2020, given the 100‐bp

cumulative cut in the BSP policy rate against the

unchanged US Federal Funds target rate.

Chart 12. BSP RRP Rate and US Federal Funds Target Rate in percent

Compared to its March 2020 level, the risk‐adjusted

spread between the two policy rates widened to

44 bps in June 2020, with a 126‐bp decline in risk

premium (measured as the difference between

the 10‐year ROP and the 10‐year US note). The risk

premium declined following the 132‐bp decrease

in the yield of the 10‐year ROP note and the 6‐bp

decline in the yield of 10‐year US Treasury note.

Chart 13. Risk‐Adjusted Differentials in basis points

‐50

0

50

100

150

200

250

300

350

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

RP 91‐day T‐bill vs. US 90‐day LIBOR (before tax) RP 91‐day T‐bill vs. US 90‐day T‐bill (before tax)

RP 91‐day T‐bill vs. US 90‐day LIBOR (after tax) RP 91‐day T‐bill vs. US 90‐day T‐bill (after tax)

‐1

0

1

2

3

4

5

6

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

BSP RRP Rate

US Federal Funds Target Rate

0

25

50

75

100

125

150

175

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2


Financial Sector

Banking System

The Philippine banking system continued to show

resilience and stability even as the country’s

economic activities and financial transactions were

severely limited by the disruption caused by the

pandemic and quarantine measures.

Banking system sustains growth in assets and deposits

In Q2 2020, banks’ balance sheets exhibited

sustained annual growth in assets and deposits,

though mildly subdued with respect to end‐March

2020 levels. At the same time, asset quality

remained steady while capital adequacy ratios

stayed above international standards. Banks

maintained dominance in the financial sector, with

universal and commercial banks (U/KBs) accounting

for about 92.4 percent of total banks’ resources.

In terms of the number of head offices and

branches/agencies, non‐bank financial

intermediaries have the widest physical network,

consisting mainly of pawnshops.

Performance of the Banking System

Market Size

The number of banking institutions (head offices) as

of end‐June 2020 decreased to 541 offices from 554

a year ago and 542 a quarter ago (Table 7).

Banks’ operating network continues to expand

The banks’ head offices are comprised of 46 U/KBs,

48 thrift banks (TBs), and 447 rural banks (RBs). This

indicated continued consolidation of banks.

15 GDP as of end‐June 2020.

Chart 14. Number of Banking Institutions

During the same period, the operating network

(head offices and branches/agencies) of the

banking system expanded to 12,912 offices from

12,543 offices a year ago and 12,905 offices a

quarter ago.

The total resources of the banking system reached

₱19.1 trillion as of end‐June 2020. This was

8.5 percent and 1.6 percent higher relative to the

year‐ and quarter‐ago levels (Table 8). As a percent

of GDP, total resources stood at 101.3 percent.15

Chart 15. Total Resources of the Banking System

levels in trillion pesos; share in percent

Savings Mobilization

As of end‐June 2020, banks’ total deposits reached

P11.2 trillion, higher than the year‐ago level by

12.4 percent and the quarter‐ago level by

2.6 percent.16

Bank deposits sustain growth

16 This refers to the total peso‐denominated deposits of the banking system.

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Mar2017

Jun Sep Dec Mar2018

Jun Sep Dec Mar2019

Jun Sep Dec Mar2020

Jun

Universal and Commercial Banks Thrift Banks Rural Banks

Source: BSP

85

87

89

91

93

95

97

99

101

103

0

2

4

6

8

10

12

14

16

18

20

22

Mar2017

Jun Sep Dec Mar2018

Jun Sep Dec Mar2019

Jun Sep Dec Mar2020

Jun

Total Resources (LHS)

as % of GDP (RHS)

Source: BSP


For the same period, savings, demand and

time deposits increased, quarter‐on‐quarter (q‐o‐q),

by 5.0 percent, 0.6 percent and 0.6 percent,

respectively. On the other hand, foreign‐currency

deposits (FCDs) owned by residents declined

slightly, q‐o‐q, by 0.5 percent to ₱2.1 trillion.17

Chart 16. Deposit Liabilities of Banks in trillion pesos

Bank Lending Operations

Outstanding loans of universal and commercial

banks, net of RRP placements with the BSP, grew,

y‐o‐y, by 9.6 percent in June 2020.18

Bank lending posts single-digit growth in Q2

Loans for production activities grew by 8.3 percent

during the same period. The increase in

production loans was driven primarily by lending

to the following sectors: real estate activities

(16.8 percent); financial and insurance activities

(10.6 percent); information and communication

(23.7 percent); electricity, gas, steam and air

conditioning supply (5.4 percent); and

transportation and storage (11.0 percent).

Bank lending to other sectors also increased

during the month, except for mining and

quarrying (‐2.8 percent), professional, scientific,

and technical services (‐5.5 percent), and

manufacturing (‐0.7 percent).

17 FCD‐Residents, along with M3, forms part of a money supply measure called M4. Meanwhile, M3 consists of savings deposits, time deposits, demand deposits, currency in circulation, and deposit substitutes. 18 The slowdown in bank lending reflects in part the weak domestic economic prospects and constrained economic activity following the imposition of quarantine measures to contain the

Chart 17. Loans Outstanding of Commercial Banks (Gross of RRPs) in trillion pesos

Similarly, loans for consumption of households,

still reeling from the partial mobility restrictions

and weak consumer confidence, grew y‐o‐y

at a slower pace of 26.7 percent in June from

30.2 percent in May, following slowdown in credit

card, motor vehicle, and salary‐based general

purpose consumption loans during the month.

Credit Card Receivables

The credit card receivables (CCRs) of the

banking system as of end‐March 2020 increased

by 47.6 percent to ₱446.5 billion, y‐o‐y, and by

20.7 percent, q‐o‐q.

Credit card receivables remain on the uptrend in end-March

The ratio of CCRs to the total loan portfolio (TLP)

increased to 4.2 percent as of end‐March 2020

relative to the previous quarter’s and year’s ratios

of 3.5 percent and 3.2 percent, respectively. In

terms of loan quality, the ratio of non‐performing

CCRs to total CCRs remained at 5.3 percent relative

to the quarter‐ago ratio and improved slightly from

5.6 percent a year ago.

Motor Vehicle Loans19

As of end‐March 2020, the banking system’s motor

vehicle loans (MVLs) increased to ₱597.1 billion,

COVID‐19 outbreak. In this regard, the BSP continues to adopt measures to ensure the flow of credit to affected businesses and households, including a further reduction in the monetary policy rate as well as a cut in the reserve requirement ratios of thrift and rural/cooperative banks. 19 Formerly “Auto Loans”, renamed effective September 2015.

0

2,000

4,000

6,000

8,000

10,000

12,000

Mar2017

Jun Sep Dec Mar2018

Jun Sep Dec Mar2019

Jun Sep Dec Mar2020

Jun

Demand Savings Time

Source: BSP

0

1

2

3

4

5

6

7

8

9

10

11

Mar2017

Jun Sep Dec Mar2018

Jun Sep Dec Mar2019

Jun Sep Dec Mar2020

Jun

Source: BSP


registering a y‐o‐y growth of 11.9 percent and a

q‐o‐q growth of 2.3 percent.

Vehicle loans post moderate growth in end-March

Demand for passenger cars and commercial

vehicles continued its growth, albeit moderately,

as the ECQ was lifted in some parts of the country.

Further, introduction of new and refreshed models,

appropriate product mix, as well as flexible

financing schemes from banks and other financing

firms helped sustain the rise in vehicle purchases.

The share of total MVLs to TLP was unchanged at

5.6 percent relative to the year‐ago ratio increased

marginally compared to the quarter‐ago ratio of

5.5 percent. In terms of loan quality, the ratio of

non‐performing MVLs to total MVLs grew slightly

to 4.5 from the 3.8 percent and 4.0 percent posted

a year and a quarter ago.

Salary‐Based General‐Purpose Consumption

Loans20

The banking system’s Salary‐Based General‐Purpose

Consumption Loans (SBGPCL) rose to ₱160.4 billion

as of end‐March 2020, 6.4 percent and 3.1 percent

higher than the year‐ and quarter‐ago level.21

Salary loans increase as of end-March

The share of total SBGPCLs to TLP declined slightly

to 1.5 percent relative to the year‐ago ratio of

1.6 percent but was unchanged relative to the

quarter‐ago ratio. In terms of loan quality, the

ratio of non‐performing SBGPCLs to total SBGPCLs

improved to 6.0 percent from the previous year’s

6.2 percent but increased slightly from the previous

quarter’s 5.7 percent.

20 Formerly “Salary Loans” 21 Data collection started with June 2014 data. 22 The regulatory relief package include the following, among others: (1) exclude exposure of affected borrowers from the computation of the past due loan ratios; waiver of BSP documentary requirements for restructured loans, and (2) allow

Residential Real Estate Loans

As of end‐March 2020, the total residential real

estate loans (RRELs) of the banking system reached

₱772.3 billion, growing by 11.8 percent, y‐o‐y, and

by 1.7 percent, q‐o‐q.

Real estate loans continue to expand in end-March

Sustained household investments in residential

properties and the increase in the number of

projects unveiled by real estate developers

supported the growth in real estate purchases

during the review period. Total RRELs to TLP grew

slightly to 7.3 percent relative to the year‐ and

quarter‐ago ratio of 7.2 percent. In terms of loan

quality, non‐performing RRELs to total RRELs

increased slightly to 3.5 percent from 2.8 percent

and 3.1 percent, recorded a year and a quarter ago,

respectively.

Asset Quality and Capital Adequacy

The Philippine banking system’s Gross

Non‐Performing Loan (GNPL) ratio rose to

2.5 percent as of end‐June 2020 from the

year‐ and quarter‐ ago ratios of 2.1 percent and

2.2 percent, respectively (Table 9). Amid the

ongoing pandemic, GNPL ratio remained below its

pre‐Asian crisis level of 3.5 percent on the back of

banks’ initiatives to improve their asset quality

along with timely and prudent lending

regulations.22,23

Improved asset quality indicates banks remain healthy

Likewise, the net non‐performing loan (NNPL) ratio

increased to 1.3 percent as of end‐June 2020

relative to the year‐ and quarter‐ ago ratio of

1.1 percent and 1.2 percent, respectively.

staggered booking of allowance for credit losses for loans extended to affected borrowers for a maximum period of five years, subject to approval of the BSP (per BSP Memorandum No. M‐2020‐008). 23 The 3.5 percent NPL ratio was based on the pre‐2013 definition.


Chart 18. Ratio of Gross NPLs and Net NPLs to Total Loans of the Banking System

In computing for the NNPLs, specific allowances

for credit losses on NPLs are deducted from the

GNPLs. Said allowances increased to ₱133.3 billion

as of end‐June 2020 from ₱99.5 billion a year ago

and P116.9 billion a quarter ago.24

Compared with regional counterparts, the

Philippine banking system’s GNPL ratio of

2.5 percent was higher with respect to those of

Malaysia (0.9 percent) and South Korea

(0.7 percent) but was lower than those of Indonesia

(2.9 percent) and Thailand (3.0 percent).25

The loan exposures of banks remain adequately

covered as NPL coverage ratio of the banking

system rose to 109.9 percent as of end‐June 2020

from 93.3 percent a year ago and 91.3 percent a

quarter ago.

The capital adequacy ratio (CAR) of U/KBs at

end‐December 2019, on solo basis, decreased

marginally to 15.4 percent from 15.6 percent as

of end‐September 2019. Meanwhile, on a

consolidated basis, CAR of U/KBs remained

unchanged at 16.0 percent relative to the previous

quarter. These figures remained well above the

BSP’s regulatory threshold of 10.0 percent and

international standard of 8.0 percent.

24 This type of provisioning applies to loan accounts classified under loans especially mentioned (LEM), substandard‐secured loans, substandard‐unsecured loans, doubtful accounts and loans considered as loss accounts. 25 Sources: Malaysia (Banking System’s Ratio of net impaired loans to net total loans, June 2020); South Korea (Domestic Banks’ Substandard or Below Loans [SBLs] ratio, June 2020); Indonesia (Commercial Banks’ Nonperforming Loans to Gross

UKBs’ CAR remains well above international and regulatory standards

The CAR of Philippine U/KBs, on consolidated basis,

was higher than that of South Korea (14.5 percent)

but lower than those of Malaysia (17.7 percent),

Thailand (19.2 percent) and Indonesia

(22.5 percent).26

Chart 19. Capital Adequacy Ratio of Universal and Commercial Banks in percent

Banking Policies

Banking policies implemented during the

quarter were aimed at enhancing/providing

guidelines/regulations on the following:

(1) alternative compliance with the reserve

requirements of banks and non‐bank financial

institutions with quasi‐banking functions (NBQBs);

(2) treasury activities of BSP‐Supervised Financial

Institutions (BSFIs); (3) foreign currency deposit

system; (4) sustainable financial framework; and

(5) risk‐based capital adequacy frameworks for

banks/quasi‐banks (QBs) (Annex A).

Loans Ratio, June 2020); and Thailand (Total Commercial Banks’ Gross NPL ratio, December 2019). 26 Sources: South Korea (Domestic Banks’ Total Capital Ratio, June 2020); Malaysia (Banking System’s Total Capital Ratio, June 2020); Thailand (Commercial Banks’ Capital Funds Percentage of Risk Assets, June 2020); and Indonesia (Commercial Banks‘ Regulatory Capital to Risk‐Weighted Assets Ratio, June 2020).

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.2

1.4

1.6

1.8

2.0

2.2

2.4

2.6

2.8

Mar2017

Jun Sep Dec Mar2018

Jun Sep Dec Mar2019

Jun Sep Dec Mar2020

Jun

Gross NPLs/Total Loans (LHS)

Net NPLs/Total Loans (RHS)

Source: BSP

13

14

15

16

17

18

Mar2017

Jun Sep Dec Mar2018

Jun Sep Dec Mar2019

Jun Sep Dec

Solo Basis

Consolidated Basis

Source: BSP


Capital Market Reforms

During the second quarter, capital market policies

were focused on regulatory and operational relief

measures amidst the pandemic. Specifically, the

BSP, the Philippine Stock Exchange (PSE), and

the Securities and Exchange Commission (SEC)

implemented policies focused on extending

financial relief to borrowers, ensuring sufficient

liquidity in the financial system, promoting

continued access to financial services, managing

extreme market volatility, and encouraging the

use of e‐payment while strengthening cybersecurity

(Annex B).

Stock Market

The Philippine Stock Exchange index (PSEi) declined

by 15.2 percent quarter‐on‐quarter to average

5,832.17 index points in Q2 2020. Trading in the

equities market remained relatively volatile due to

expectations of the negative impact of the COVID‐

19 pandemic on the economy.

Average PSEi declines in Q2 2020

The BSP’s decision to provide liquidity to stimulate

economic activity and the gradual easing of the

government’s quarantine measures in some

parts of the country improved investor sentiment.

Subsequently, the main index closed at

6,207.72 index points in end‐June, about

16.7 percent higher relative to the closing index

in end‐March of 5,321.23 index points.

During the review period, expectations of economic

losses following the extension of the ECQ in most

parts of Luzon until May 15 (e.g., the contraction in

the Philippines’ manufacturing Purchasing

27 The IMF projected that the Philippine economy will contract by 3.6 percent from April’s forecast of a 0.6 percent growth. The figure is worse than the World Bank’s 1.9 percent contraction estimate and the government’s estimate of 2.0‐3.4 percent decline. 28 Global crude oil prices were dragged down by a supply glut and dropping demand for crude oil due to the coronavirus pandemic. 29 On 15 June, tension between India and China escalated following the violent clash between Indian and Chinese troops in a disputed border.

Managers’ Index (PMI) data (in April and May) and

the decline in Philippine GDP in Q1 2020 that ended

the country’s uninterrupted 21‐year growth streak);

the IMF’s negative outlook for the Philippine

economy;27 and the BSP’s announcement that

remittances from overseas Filipino workers may

drop 5 percent this year negatively affected trading

in the Philippine stock market.

Chart 20. Average PSEi in index points

Moreover, external developments such as the sharp

drop in oil prices;28 lingering trade tensions

between the US and China; renewed conflict

between China and India;29 the US Fed’s negative

assessment of US economic prospects;30 and

concerns over a “second wave” of COVID‐19

infections across the globe31 also weighed on the

main index.

The negative performance of the domestic stock

market was tempered by the following: the BSP’s

decision to inject liquidity into the economy

through cuts in policy rates and reduction in banks’

reserve requirement ratio (RRR) to spur economic

activity; the easing of domestic inflation; the

Philippine government’s openness to public‐private

partnerships (PPP) in infrastructure projects and

it’s implementation of fiscal stimulus packages;

the easing of quarantine measures starting June

that allowed some businesses to reopen;32 news

30 The US Federal Reserve projected a 6.5 percent decline in the GDP of the US this year. 31 On 29 June, data from the Johns Hopkins Coronavirus Resource Center showed that about 10.15 million COVID‐19 cases have been recorded across the world. The United States and Brazil are leading other nations in the number of cases with 2.55 million and 1.34 million cases, respectively. 32 On 28 May, President Duterte announced that Metro Manila and nearby cities would be placed under GCQ starting 1 June to gradually reopen the economy after more than two months of strict quarantine measures that halted economic activity.

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Source: Philippine Stock Exchange (PSE), BSP


of potential COVID‐19 vaccines; and Merry Mart

Consumer Corporation’s successful debut at the

PSE. In addition, relaxing lockdown measures

abroad (e.g., US, France, Germany, Italy, Spain,

Austria, Denmark) and the US Fed’s announcement

of plans to begin its corporate bond‐buying

program33 lifted trading in the local stock market.

Mirroring the gradual uptick in the benchmark

index, total capitalization in the Philippine stock

market went up from ₱12.04 trillion in end‐March

2020 to reach ₱13.17 trillion in end‐June 2020. The

price‐earnings (P/E) ratio of listed firms similarly

improved from 12.6x in end‐March to reach 20.2x

in end‐June. In contrast, foreign investors continued

to withdraw from the local stock market as they

posted net sales of ₱36.6 billion in Q2 2020 from a

₱32.3‐billion net sales in the preceding quarter.

Bond Market

Local Currency Bond Market Size and Composition34

Local currency (LCY) bonds issued by both

the public and private sectors amounted to

₱783.8 billion in the second quarter of 2020.

This was less than the ₱848.7 billion registered

in the previous quarter but 70.1 percent higher

than the ₱460.7 billion recorded in the same

period last year.

LCY bond issuances of the private sector decrease

The NG‐issued T‐bills, Fixed‐Rate Treasury bonds

(FRTBs) and Benchmark bonds reached a total of

₱706.1 billion to increase by 5.4 percent from its

Q1 2020 level. The increase in government

issuances reflects the NG’s continuous need to

counter the impact of the COVID‐19 outbreak in the

country. The NG took advantage of the domestic

liquidity due to the reduced reserve requirement

Meanwhile, the rest of the country was placed under modified general quarantine at the same time. 33 The Federal Reserve announced on 15 June that it will start buying up to $250 billion corporate bonds through the secondary market corporate credit facility to assist small and medium‐sized businesses survive the COVID‐19 pandemic.

ratio (RRR) and enhanced liquidity measures

implemented by the BSP during the quarter.

Meanwhile, the private sector issuance of LCY

bonds amounted to ₱77.7 billion, 56.5 percent

lower than that in the previous quarter and

62.4 percent lower than that in the previous year.

Local firms were less aggressive in tapping the

bond market as business disruptions and prospects

of a decline in business revenues brought about

by the COVID‐19 pandemic started to relatively

affect corporates’ borrowing capacities.

Chart 21. LCY Bond Issuances in billion pesos

In terms of market share, issuances from the public

sector comprised 90.1 percent share of the total

bond issuances while the private sector took the

remaining 9.9 percent. Bonds issued by the BTr

accounted for the entire public sector issuance

while issuers from the private sector came from

banks and holding companies.

Chart 22. LCY Bond Issuances as percent of market share; Q2 2020

34This refers to the peso‐denominated bond issuances by both public and private sectors. Public sector issuances of LCY bonds include issuances in the primary market and rollovers of maturing series which were issued by the BTr and Government Owned‐ and Controlled‐ Corporations (GOCCs).

0

100

200

300

400

500

600

700

800

900

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Private Sector Public Sector

Source: BTr, Bloomberg, Staff Calculation

Public Sector90.1%

Private Sector9.9%

Source: BTr, Bloomberg, Staff Calculation


Primary Market35

In the primary auctions conducted for both

T‐bills and Treasury Bonds (T‐bonds), the NG

offered a total of ₱572.0 billion short‐ and

long‐term debt securities. Demand was robust as

tenders were oversubscribed by about 3.5 times.

The market showed preference for short‐term

dated debt securities as tenders for T‐bills reached

P1,395.8 billion as against the NG’s offering of

P392.0 billion. Such tenders were higher than the

tenders for T‐bonds, which reached ₱598.5 billion

against the P180.0 billion offering. Relatively higher

demand for short‐term debt indicates investors’

risk‐averse attitude amid the uncertain and

challenging market environment.

The NG fully awards auction offerings

The NG fully awarded the oversubscribed

₱572.0 billion offering of GS (combined offerings

for T‐bills and T‐bonds) in Q2 2020 while rejecting

tenders whose bid rates were found to be relatively

higher than NG’s preferred rates.

Secondary Market

Trading of both government and private corporate

bonds at the secondary market increased by

1.4 percent to ₱1,782.5 billion from ₱1,757.5 billion

registered in the previous quarter. Similarly, on a

y‐o‐y basis, trading in the secondary market also

increased by 31.1 percent.

Trading increases in the secondary market

Trading was dominated mostly by Fixed‐Income

Treasury Notes (FXTNs) and Retail Treasury Bonds

(RTBs) which accounted for 56.9 percent and

22.1 percent, respectively, of the total trading.

Meanwhile, the share of corporate bonds traded

at the Philippine Dealing and Exchange Corporation

(PDEx) remained marginal at 0.8 percent.

35 The discussion includes primary market for government issuances only.

Chart 23. Secondary Market Volume in billion pesos

The volume of corporate bonds traded at the

exchange also dropped, from ₱18.8 billion in

Q1 to ₱13.9 billion in Q2, on the back of lower

corporate earnings due to community lockdowns

that led to disruptions in the operations of many

businesses in the second quarter. The overall slight

increase in activity at the secondary market (q‐o‐q)

partly reflected the build‐up of cautious optimism

among investors.

Foreign Currency Bond Market

During the quarter, the government issued in

the offshore market US$2.35 billion worth of

new 10‐year and 25‐year global bonds to support

its budgetary needs. The NG took advantage of

the strong demand and low rates from international

investors.36

The NG taps the international bond market in sourcing funds

Meanwhile, for the private sector, most firms took

advantage of the ample domestic liquidity as they

relied more on domestic financing sources than

on foreign creditors, thereby limiting exposure to

foreign exchange risks. Only two holding companies

issued dollar bonds amounting to a total of

US$700 million in June.

36 https://www.treasury.gov.ph/?p=35452

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Source: Philippine Dealing and Exchange Corporation (PDEx)


Credit Risk Assessment

On 07 May 2020, Fitch Ratings has affirmed the

Philippines’ rating at ‘BBB’ and changed the outlook

to "stable" from "positive". A “stable” outlook

indicates that the Philippines’ rating will likely be

maintained over the next 18‐24 months. On the

other hand, on 29 May 2020, S&P also affirmed

Philippines’ ‘BBB+’ rating, and “stable” outlook as

the world continues to deal with the COVID‐19

pandemic and its perceived ability to bounce back

from the crisis.

Credit rating agencies affirm PH ratings amid pandemic

Both Fitch Ratings and S&P outlook recognized the

Philippines’s sound macroeconomic fundamentals

going into the COVID‐19 pandemic. Fitch’s latest

assessment stressed that the county has built

buffers that helped mitigate the impact of the

economy while S&P recognized that the country

was able to implement massive relief response

without fear of a debt blowout.

The affirmation of the ‘BBB+’ rating by S&P is a

notch away from the minimum score within the “A”

territory— and the stable outlook, at this time of

crisis, is a vote of confidence which comes amid a

wave of credit rating downgrades and negative

outlook revisions worldwide as the pandemic

wreaks havoc on productivity of economies.

Further, S&P said the affirmation of the Philippines’

credit rating reflects its “expectations that the

economy will continue to achieve above‐average

growth over the medium term, which will drive

constructive development outcomes and underpin

broader credit metrics.”

On 11 June 2020 Japan Credit Rating Agency (JCRA)

upgraded the Philippines’ credit rating by a notch

from BBB+ rating to “A‐“. JCRA cited the country’s

resilience amid a pandemic that has slowed down

growth, impaired fiscal positions and hurt credit

ratings of economies across the globe. The JCRA

outlook upgrade was a result of its assessment that

the impact of the COVID‐19 crisis on the domestic

economy and the government’s fiscal standing will

be temporary, given the strong fundamentals going

into the crisis, the massive relief measures, as well

as the pursuit of important legislation, such as the

CREATE Act under the Comprehensive Tax Reform

Program (CTRP). JCRA assigned a “stable” outlook

on the new rating, which indicates that the “A‐”

rating will be maintained over the near term.

Bond spreads

In April and May, debt spreads narrowed as policy

measures and regulatory reliefs were implemented

to mitigate the adverse impact of COVID‐related

risks on the economy and the financial markets.

Debt spreads narrow

In June, debt spreads continued to narrow over the

government’s decision to lift the modified

enhanced community quarantine in major parts of

the country. The lifting of the quarantine allowed

businesses to resume operations.

As of 30 June 2020, the extra yield investors

demanded to own Philippine sovereign debt over

US Treasuries or the Emerging Market Bond Index

Global (EMBIG) Philippines spread stood at 164

basis points (bps) from the end‐March level of 222

bps.

Chart 24. Emerging Market Bond Index Global Spreads of Selected ASEAN Countries in basis points

0

50

100

150

200

250

300

350

400

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

EMBIG Philippines

EMBIG Indonesia

EMBIG Malaysia

Source: Bloomberg


Similarly, the country’s 5‐year sovereign credit

default swap (CDS) spread decreased to 65 bps

from its end‐March level of 110 bps. Against other

neighboring economies, the Philippine CDS spread

was narrower than Malaysia’s 72 bps and

Indonesia’s 131 bps but wider than Thailand’s 43

bps and Korea’s 27 bps spreads.

Chart 25. 5‐Year CDS Spreads of Selected ASEAN Countries in basis points

Payments and Settlements System37

In Q2 2020, the total number of transactions

settled and processed in the Philippine Payments

and Settlements System (PhilPaSS) reached

307,676 transactions, 1.1 percent lower than the

previous quarter’s level of 311,247 transactions.

The decline in the number of transactions was

due mainly to the q‐o‐q decrease in GS trades

(‐38.8 percent) and peso leg of peso/US trades

(‐36.7 percent).

PhilPass transactions increase in value while volume decline slightly

On the other hand, the total value of transactions

rose by 53.5 percent to reach ₱147.6 trillion from

the quarter‐ago level of ₱96.1 trillion. The increase

in the value of transactions was mainly brought

about by monetary operations transactions

(85.0 percent), government collections through

interbank transactions (29.4 percent), and

automatic clearing house transactions

(25.5 percent). In particular, PESONet and

37 Starting 1 April 2014, the volume and value of transactions exclude payment transfers to BSP Payments Unit.

Instapay transactions grew by 25.9 percent

and 24.7 percent, respectively.

Table C. PhilPaSS Transactions

During the quarter, interbank transactions,

Philippine peso/US dollar trades (peso leg)

transactions, monetary operations transactions,

and GS trades jointly accounted for 86.2 percent

of the total volume of transactions. In terms of

value, monetary operations transactions, interbank

dealings, and Philippine peso/US dollar trades (peso

leg) transactions collectively made up 96.0 percent

of the total value of transactions.

On a y‐o‐y basis, both the volume and value

of transactions increased by 2.1 percent and


Meanwhile, total revenue derived from PhilPaSS

operations reached ₱0.02 million in Q2 2020,

100.0 percent lower than both the quarter‐ago

level and year‐ago level of ₱49.6 million and

₱43.9 million, respectively, as the BSP waived the

fees for fund transfer transactions made through

the PhilPaSS during the quarantine period.

0

50

100

150

200

250

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Philippines

Thailand

Malaysia

Korea

Source: Bloomberg

Q2 Q1 Q2 Q‐o‐Q Y‐o‐Y

Volume 301,403 311,247 307,676 ‐1.1 2.1

Value 65.55 96.14 147.62 53.5 125.2

(in tri l l ion pesos)

Transaction Fees 43.90 49.55 0.02 ‐100.0 ‐100.0

(in mil l ion pesos)

Source: Payment and Settlements Office, BSP

Growth Rates (in percent)

2019 2020


External Sector

Balance of Payments

The country’s balance of payments (BOP) position

recorded a higher surplus of US$4.2 billion in

Q2 2020 from the US$991 million posted in the

same quarter last year (Table 11).38

Q2 2020 BOP position registers higher surplus

The BOP position rose significantly due to the

reversal in the current account to a surplus,

following a substantial reduction in the trade in

goods deficit. The sluggish performance of both

imports and exports of goods reflected the adverse

impact of the COVID‐19 pandemic, including the

disruptions in the global demand and supply chains.

Meanwhile, the financial account reversed to net

outflows mainly on account of the turnaround of

portfolio investments to net outflows. This,

however, was tempered by the decline in net

outflows of other investments and the increase

in net inflows of direct investments.

Table D. Balance of Payments

in million US$

Current Account. The current account registered a

surplus of US$4.4 billion in Q2 2020, a reversal from

the US$931 million deficit posted in Q2 2019.

38 The overall BOP position was computed based on final data on the country’s Gross International Reserves (GIR). However, the balances of the current, capital, and financial accounts and their

Current account reverses to a surplus

This outcome stemmed mainly from the lower

trade in goods deficit, which more than offset the

decline in net receipts of trade in services, and

primary and secondary income.

Trade‐in‐Goods. The trade‐in‐goods account

registered a deficit of US$5.4 billion in Q2 2020,

55.2 percent lower than US$12.1 billion deficit in

the same quarter a year ago.

Trade-in-goods account deficit narrows

The narrowing of the trade‐in‐goods gap resulted

from the greater decline in goods imports of

43.6 percent vis‐a‐vis the decrease in goods exports

of 33.3 percent.

Exports of Goods. Exports of goods declined to

US$9.1 billion in Q2 2020 from US$13.6 billion in

Q2 2019, as all major commodity groups, except

petroleum products, registered lower shipments

during the quarter.

Exports of goods post double-digit decline

Demand from the country’s major trading partners,

particularly the United States (US), Japan, and

China, slowed down as external demand was

hampered in part by global economic uncertainty as

well as bottlenecks in supply chains, following entry

restrictions imposed on incoming goods to stem the

spread of the COVID‐19 pandemic. Contributing

largely to the decline in total exports of goods were

manufactures, registering a 37.5 percent decrease.

In particular, export shipments of electronic

products and other electronics fell by 32.5 percent

and 59.1 percent, respectively, specifically

components/devices (semiconductors), electronic

data processing, and communication/radar. Exports

components are preliminary as these were based on partial and preliminary data and estimates, considering the operational constraints of our data sources amid the community quarantine.

Q2 2019 Q2 2020

‐931 4,382

22 8

‐278 152

1,622 ‐62

991 4,177Overall BOP **

Net Unclassified Items

Current Account

Capital Account

Financial Account*

* Posit ive balance in the f inancial account indicates net outf lows while a

negative balance indicates net inf lows.

** The overall BOP posit ion, therefore, is equal to the current account plus

the capital account minus the f inancial account plus net unclassif ied items.

Details may not add up due to rouding

Source: BSP


of other manufactures such as machinery and

transport equipment, chemicals, travel goods and

handbags, and garments also declined. Similarly,

exports of fruits and vegetables, mineral products

and coconut products decreased.

Meanwhile, exports of petroleum products

increased markedly by 713.1 percent to reach

US$72 million in Q2 2020 on account of higher

shipments of other motor spirit, unleaded other

motor spirit, unleaded other petroleum oils and

oils obtained from bituminous minerals, other

than crude.

Chart 26. Exports by Major Commodity Group percent share, Q2 2020

Imports of Goods. Imports of goods dropped by

43.6 percent to US$14.5 billion in Q2 2020 from

US$25.8 billion in the same quarter a year ago. All

major commodity groups posted declines as most

of the economic activities nationwide halted with

the implementation of the lockdown during most

part of the quarter.

Imports of goods post substantial contraction

Imports of capital goods decreased by 47.2 percent

to US$4.1 billion on account largely of lower

purchases of telecommunication equipment and

electrical machinery (by 43.7 percent), power

generating and specialized machines (by

48.4 percent) and land transport equipment,

excluding passenger cars and motorized cycle (by

79.2 percent). Imports of raw materials and

39 Based on data from the Department of Energy, the average price of Dubai crude oil in Q2 2020 declined to US$30.55/barrel

intermediate goods declined by 31.9 percent to

US$6.2 billion owing primarily to the contraction in

importation of: a) manufactured goods, particularly

iron and steel, non‐metallic mineral manufactures

and metal products; and b) chemicals, mostly

artificial resins and chemical compounds.

Imports of mineral fuels and lubricants dropped by

74.8 percent to US$912 million brought about by

lower imports of petroleum crude and other

products. In particular, imports of petroleum crude

fell by 83.5 percent to US$103 million following

lower import volume and decline in the world

market price of petroleum crude.39

Imports of consumer goods also decreased by

46.1 percent to US$2.5 billion due to lower

purchases of passenger cars and motorized cycle

(82.7 percent) and miscellaneous manufactures

(by 60 percent) as well as food and live animals

chiefly for food (by 14.6 percent).

Chart 27. Imports by Major Commodity Group percent share, Q1 2020

Trade‐in‐Services. Net receipts of trade in services

decreased by 19.5 percent to US$2.7 billion in

Q2 2020 from US$3.3 billion in Q2 2019.

Trade-in-services account posts lower net receipts

The decline was due to higher net payments of

travel (77.6 percent) and telecommunication

services (2,102.6 percent) combined with lower

net receipts of computer (17.1 percent) and

from US$67.36/barrel in Q2 2019.


manufacturing services (17.2 percent), as well as

technical, trade‐related, and other business services

(7.3 percent).40 These developments were partly

offset by lower net payments in insurance and

pension services (38.3 percent), transport services

(21.2 percent) and charges for the use of

intellectual property (44.3 percent).

Primary Income. The primary income account

recorded net receipts of US$1 billion in Q2 2020,

14.3 percent lower than the US$1.2 billion net

receipts in the same quarter last year.

Net receipts of primary income fall

This outcome stemmed from decreased net

compensation inflows from resident overseas

Filipino (OF) workers, which fell by 12 percent to

US$1.9 billion along with lower interest receipts

on reserve assets (39.6 percent) and higher net

payments of dividends to foreign direct investors

(14.3 percent). These developments were partly

mitigated by lower dividends paid by private

corporates to foreign portfolio investors

(65.9 percent) during the quarter.

Secondary Income. Net receipts in the secondary

income account dropped to US$6.1 billion in the

second quarter of 2020.

Net receipts of secondary income decrease

The 8.5 percent shortfall was on account primarily

of the 9.3 percent decline in non‐resident OF

workers' remittances, which amounted to

US$5.6 billion during the quarter.

Capital Account. Net receipts in the capital account

decreased to US$8 million in Q2 2020 from

US$22 million in Q2 2019.

40 “Other business services” is comprised largely of earnings from business process outsourcing (BPO) related transactions. Estimates of export revenues in Q2 2020 amounted to US$4.6 billion, 12.6 percent lower than the US$5.3 billion in Q2 2019.

Capital account net receipts decline

This was on account of the combined effect of net

payments on gross acquisition of non‐produced

non‐financial assets of US$8 million (from US$1

million net receipts on gross disposal of non‐

produced non‐financial assets) and lower receipts

of other capital transfers to the NG amounting to

US$16 million from US$20 million.41

Financial Account. The financial account posted net

outflows of US$152 million in the second quarter of

2020, a turnaround from the US$278 million net

inflows in the same quarter last year.

Financial account reverses to net outflows

This developed mainly on account of the reversal

of portfolio investments to net outflows of

US$731 million from net inflows of US$1.9 billion.

This reversal was tempered by the decline in net

outflows of other investments and the increase in

net inflows of direct investments.

Direct Investments. Direct investments registered

higher net inflows to reach US$1.1 billion in

Q2 2020 from US$727 million a year ago.

Net inflows of direct investments rise

This resulted as the decline in residents’ net

investments in foreign financial assets to

US$90 million (from US$1 billion) more than offset

the contraction in foreign direct investments (FDI)

to US$1.2 billion (from US$1.7 billion). In particular,

residents’ net investments in debt instruments

dipped by 93 percent to US$52 million from

US$750 million. Likewise, residents’ net

investments in equity capital declined by 88.5

percent to US$27 million from US$239 million.

41 Other capital transfers to the NG refer to transfers for the purpose of capital formation. This includes grants and donations, the intention of which is for investment (i.e., machinery and equipment, buildings and structures).


Meanwhile, FDI declined due to the contraction in

non‐residents' net investments in debt instruments

issued by local affiliates by 48.7 percent to US$693

million. This was mitigated by the expansion in net

equity capital to US$258 million (from US$73

million) as placements increased to US$312 million

(from US$299 million) and withdrawals decreased

to US$54 million (from US$227 million).

Equity capital placements during the quarter

originated from Japan, the United Kingdom, the US

and Singapore. These placements were channeled

mainly to the manufacturing, financial and

insurance, real estate, and human health and social

work industries.

Portfolio Investments. The portfolio investment

account posted net outflows of US$731 million in

Q2 2020, a reversal of the net inflows of

US$1.9 billion recorded a year ago.

Portfolio investments reverse to net outflows

This emanated mainly from the surge in residents’

portfolio investments abroad by 320 percent to

US$2 billion (from US$475 million) coupled with

the 46.4 percent drop in non‐residents’ portfolio

investments in the country or foreign portfolio

investments (FPI) to US$1.3 billion (from

US$2.4 billion). In particular, residents’ portfolio

investments abroad expanded, reflecting mainly

the increase in net placements in debt securities,

particularly by the BSP at US$898 million (from

US$4 million), and by the other sectors at

US$877 million (from US$350 million).42

Meanwhile, the FPI declined due to non‐residents’

net withdrawals of US$741 million of their

investments in equity and investment fund

shares (from net placements of US$522 million).

This tempered the increase in non‐residents’

net investments in debt securities issued by

42 Other Sectors cover the following economic sectors: (a) other financial corporations, which include private and public insurance corporations, holding companies, government financial institutions, investment companies, other financial intermediaries except insurance, trust institutions/corporations, financing companies, securities dealers/brokers, lending investor, Authorized Agent Banks (AAB) forex corporations, investment houses, pawnshops, credit card companies, offshore

the National Government to US$1.4 billion

(from US$858 million).43

Other Investments. The other investment account

recorded lower net outflows of US$548 million

(from US$2.4 billion) in Q2 2020 on account of

the decline in residents’ net investments in foreign

financial assets. In particular, banks posted net

withdrawals of currency and deposits amounting

to US$936 million from net deposits of

US$371 million. Loans extended by local banks

to non‐residents also dropped to US$1.2 billion

from US$1.9 billion.

Net outflows in other investments drop

On the liabilities side, higher net outflows

emanated from net repayments by local banks of

their foreign loan obligations to US$2.3 billion

(from US$609 million), coupled with non‐residents’

net withdrawal of currency and deposits from local

banks amounting to US$351 million (from net

placements of US$309 million). These more than

offset the increase in net foreign loans availed by

the NG at US$2.7 billion (from US$91 million).

Financial Derivatives. Net gains from trading in

financial derivatives were lower by 52.2 percent

at US$20 million in Q2 2020 from US$42 million in

the same period last year.

Net gains from trading in financial derivatives decrease

banking units (OBUs); (b) non‐financial corporations, which refer to public and private corporations and quasi corporations, whose principal activity is the production of market goods or non‐financial services; and (3) households and non‐profit institutions serving households (NPISHs). 43 Includes issuances of ROP Global Bonds amounting to US$2.3 billion in May 2020.


International Reserves

The country’s gross international reserves (GIR)

amounted to US$93.5 billion as of end‐June 2020

(revised), higher than the US$88.9 billion in

end‐March 2020.

Reserves at record high

At this level, the GIR remains adequate as it can

cover 8.5 months’ worth of imports of goods and

payments of services and primary income. It is also

equivalent to 7.0 times the country’s short‐term

external debt based on original maturity and

4.6 times based on residual maturity.

Chart 28. Gross International Reserves in billion US dollars

The increase in reserves was due mainly to inflows

arising from the BSP’s income from its investments

abroad. The increase was also due to the higher BSP

reserve position and holdings of Special Drawing

Rights (SDRs) in the International Monetary Fund

(IMF); and higher foreign exchange operations

by the BSP. Meanwhile, the BSP’s holdings of

monetary gold remained essentially unchanged.

The bulk of the country’s total reserves or

86.5 percent was held in foreign investments.

Meanwhile, 8.6 percent were in gold and the

remaining 4.9 percent were in holdings of SDRs,

the BSP’s reserve position in the IMF, as well as

foreign exchange.

Net international reserves (NIR), which refer to

the difference between the BSP’s GIR and total

short‐term liabilities, amounted to US$93.5 billion

as of end‐June 2020, an increase of

US$4.6 billion from end‐March 2020.

44 Dollar rates (per peso) or the reciprocal of the peso‐dollar

Exchange Rate

Exchange Rate

The peso averaged ₱50.45/US$1 in Q2 2020,

appreciating by 0.75 percent from the Q1 2020

average of ₱50.83/US$1.

Peso appreciates against the US dollar

The peso appreciated amid the health crisis on

positive market view given the country’s

macroeconomic fundamentals, which include the

manageable inflation environment, a strong and

resilient banking system, prudent fiscal position,

and a high level of international reserve buffer.

On a y‐o‐y basis, the peso likewise appreciated by

3.20 percent relative to the ₱52.07/US$1 average

in Q2 2019.44

Chart 29. Quarterly Peso‐Dollar Rate Php/US$

In April, the peso appreciated to an average of

₱50.73/US$1, 0.33 percent higher than the

₱50.90/US$1 average in March. The peso

appreciated on market optimism amid the

government’s cash aid for low income households;

the perceived slowdown in the number of

infections in some virus hotspot countries; and the

slower domestic inflation in March 2020. The BSP’s

moves to ensure sufficient liquidity in the system,

such as lowering the minimum liquidity ratio (MLR)

requirement of standalone thrift, rural and

cooperative banks to 16 percent from 20 percent,

likewise provided support to the peso.

rates were used to compute for the percentage change.

70

74

78

82

86

90

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Source: BSP

48

49

50

51

52

53

54

55

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

Source: Reference Exchange Rate Bulletin, Treasury Department, BSP


The appreciation of the peso continued in May

to an average of ₱50.56/US$1, 0.35 percent higher

than the average during the previous month. The

peso appreciated following the further easing of

lockdown measures in some regions in the country

(including the National Capital Region) to slowly

reopen the economy; and improved prospects of

a vaccine against COVID‐19. In addition, S&P Global

Ratings’ affirmation of the country’s sovereign

credit rating as well as the slower domestic inflation

in April 2020 have provided support to the peso.

In June, the peso averaged ₱50.13/US$1

appreciating by 0.85 percent from the average

in May. The appreciation of the peso reflected

positive market sentiment due to: (i) narrower

domestic trade deficit data in April 2020; (ii) slower

domestic inflation and the country’s record‐high

dollar reserves in May 2020; and (iii) the policy rate

cut by the BSP on 25 June 2020 to further support

economic recovery.

Chart 30. Year‐to‐Date Appreciation (+)/ Depreciation (‐) of Asian Currencies against US dollar in percent, as of end‐June 2020

On a y‐t‐d basis, the peso appreciated against

the US dollar by 1.62 percent to close at

₱49.83/US$1 on 30 June 2020 from the end‐

December 2019 closing rate of ₱50.64/US$1.45

45 Based on the last done deal transaction in the afternoon. 46 The coefficient of variation is computed as the standard deviation of the daily closing exchange rate divided by the average exchange rates for the period. 47 The TPI measures the nominal and real effective exchange rates of the peso across the currencies of 14 major trading partners (MTP:s) of the Philippines, which include the US, Euro Area, Japan, Australia, China, Singapore, South Korea, Hong Kong, Malaysia, Taiwan, Indonesia, Saudi Arabia, United Arab Emirates, and Thailand. The TPI‐A measures the effective exchange rates of the peso across currencies of trading partners in advanced countries comprising of the US, Japan, Euro Area, and Australia. The TPI‐D measures the effective exchange rates

Meanwhile, the volatility of the peso’s daily closing

rates (as measured by the coefficient of variation)

stood at 0.17 percent in Q2 2020, lower than the

0.43 percent registered in the previous quarter.46

The volatility of the peso in the review quarter was

also lower than the volatility of most currencies in

the region.

On a real trade‐weighted basis, the peso lost

external price competitiveness in Q2 2020 against

the basket of currencies of all trading partners (TPI)

and trading partners in developing (TPI‐D) countries

relative to Q1 2020. This was indicated by the

increase in the real effective exchange rate (REER)

index of the peso by 2.12 percent and 3.89 percent,

against the TPI and TPI‐D baskets, respectively.

Meanwhile, against the basket of currencies of

trading partners in advanced (TPI‐A) countries,

the REER index of the peso decreased slightly by

0.97 percent.

Relative to Q2 2019, the peso likewise lost external

price competitiveness across currency baskets

during the review period. This developed following

the nominal appreciation of the peso and the

widening of inflation differentials, resulting in

the increase in the REER index of the peso by

6.58 percent, 5.24 percent and 7.34 percent against

the TPI, TPI‐A and TPI‐D baskets, respectively.47,48

of the peso across 10 currencies of partner developing countries which includes China, Singapore, South Korea, Hong Kong, Malaysia, Taiwan, Indonesia, Saudi Arabia, United Arab Emirates, and Thailand. 48 The REER index represents the Nominal Effective Exchange Rate (NEER) index of the peso, adjusted for inflation rate differentials with the countries whose currencies comprise the NEER index basket. A decrease in the REER index indicates some gain in the external price competitiveness of the peso, while a significant increase indicates the opposite. The NEER index, meanwhile, represents the weighted average exchange rate of the peso vis‐à‐vis a basket of foreign currencies.

1.79

1.62

0.83

‐1.51

‐2.63

‐3.53

‐3.84

‐3.84

‐4.39

‐5.44

‐7 ‐6 ‐5 ‐4 ‐3 ‐2 ‐1 0 1 2 3

New Taiwan Dollar

Philippine Peso

Japanese Yen

Chinese Yuan

Indonesian Rupiah

Singaporean Dollar

South Korean Won

Thai Baht

Malaysian Ringgit

Indian Rupee

Note: Based on last done deal transaction (closing price) as of 2:00 pm, Manila Time Source: PDEX, Bloomberg


External Debt

The Philippines’ outstanding external debt49

stood at US$87.5 billion as of end‐June 2020,

up by US$6.0 billion (or 7.4 percent) from the

US$81.4 billion level as of end‐March 2020

(Table 14).

External debt increases

The rise in the country’s debt stock during the

second quarter of 2020 was due mainly to net

availments of US$2.9 billion, as the NG raised

US$2.4 billion from the issuance of global bonds

and US$3.1 billion from multilateral and bilateral

creditors to fund its general financing requirements

and COVID‐19 pandemic response

programs/projects.

Chart 31. Philippine External Debt in billion US dollars

Further increases to the debt level were due to:

(a) prior periods’ adjustments of US$2.1 billion;50

(b) increase in non‐residents’ investment in

Philippine debt papers issued offshore of

US$839 million; and (c) positive foreign exchange

(FX) revaluation of US$227 million as the US Dollar

weakened against other currencies, including the

Philippine Peso.

Year‐on‐year, the country’s debt stock rose by

US$6.2 billion, which was brought about by:

(a) prior periods’ adjustments (US$2.7 billion);

49 External debt refers to all types of borrowings by Philippine residents from non‐residents, following the residency criterion for international statistics. Outstanding external debt are valued at exchange rates as at end‐March 2020 while transaction amounts (e.g., availment, repayment, interest payment) are converted to US Dollar equivalent based on exchange rates

(b) transfer of Philippine debt papers from residents

to non‐residents (US$2.0 billion); (c) net availments

(US$1.4 billion); and (d) positive FX revaluation

(US$89 million).

By Maturity

As of end‐June 2020, the maturity profile of the

country’s external debt remained predominantly

medium‐and long‐term (MLT) in nature [i.e., those

with original maturities longer than one (1) year],

with share to total at 87.7 percent (US$76.7 billion).

This means that FX requirements for debt payments

are well spread out and more manageable.

Chart 32. Philippine External Debt by Maturity as of end‐June 2020

The weighted average maturity for all MLT accounts

slightly increased to 17.0 years from 16.9 years

during the previous quarter, with public sector

borrowings having a longer average term of

20.9 years compared to 7.8 years for the private

sector. Meanwhile, ST liabilities comprised the

12.3 percent balance of the debt stock and

consisted of bank liabilities, trade credits and

others.

By Borrower

Public sector external debt rose to US$51.0 billion

or by US$5.9 billion (13.0 percent) from

US$45.1 billion in the previous quarter, with

share to total external debt increasing from

55.4 percent to 58.3 percent due largely to net

availments of US$5.1 billion by the NG to fund

prevailing on transaction dates. Principal data sources include regular reports from borrowers, banks and other financial institutions, major foreign creditors and news articles in local and international publications, as well as through conduct of external debt surveys. 50 Due mainly to late reporting of transactions by borrowers.

70

72

74

76

78

80

82

84

86

88

90

Mar2017

Jun Sep Dec Mar2018

Jun Sep Dec Mar2019

Jun Sep Dec Mar2020

Jun

Source: International Operations Department (IOD)‐BSP


its general financing requirements and

programs/projects as the NG implements measures

to stimulate the economy and support economic

recovery amid the COVID‐19 pandemic. About

US$44.4 billion (87.1 percent) of public sector

obligations were NG borrowings while the

remaining US$6.6 billion pertained to borrowings

of GOCCs, government financial institutions and

the BSP.

Chart 33. Philippine External Debt by Borrower as of end‐June 2020

Private sector debt slightly increased from

US$36.3 billion as of end‐March 2020 to

US$36.5 billion as of end‐June 2020, with share

to total decreasing from 44.6 percent to

41.7 percent. The recorded increase was due

largely to prior periods’ adjustments

(US$2.1 billion) and net availments (US$334 million)

by private non‐banks, which were offset by net

repayments (US$2.3 billion) by private banks.

About US$6.9 billion of these accounts were

obtained without BSP approval/registration,

while capital leases amounted to US$830 million.

By Creditor

Major creditor countries as of end‐June 2020 were

Japan (US$15.3 billion), United States of America

(US$3.2 billion), The Netherlands (US$3.1 billion),

and United Kingdom (US$2.6 billion).

Loans from official sources [multilateral and

bilateral creditors (Japan – US$8.2 billion;

China – US$1.1 billion; and Republic of

Korea – US$514 million, among others)]

had the largest share (34.9 percent) of total

outstanding debt, followed by foreign holders

of bonds and notes (33.6 percent), and obligations

to foreign banks and other financial institutions

(26.3 percent). The rest (5.1 percent) were owed

to other creditor types (mainly suppliers and

exporters).

The country’s debt stock remained largely

denominated in US Dollar (US$48.5 billion or

55.4 percent of total) and Japanese Yen

(US$10.8 billion or 12.4 percent of total).

US Dollar‐denominated multi‐currency loans

from the World Bank and ADB (US$16.2 billion)

represented 18.5 percent of the total. The

13.7 percent balance (US$12.0 billion) pertained

to 15 other currencies, including the Philippine Peso

(6.5 percent), Euro (4.5 percent) and SDR

(1.5 percent).

The Debt Service Ratio (DSR), which relates

principal and interest payments (debt service

burden or DSB) to exports of goods and receipts

from services and primary income, is a measure

of adequacy of the country’s FX earnings to meet

maturing obligations. For January to June 2020,

the ratio slightly increased to 7.8 percent from the

7.7 percent recorded for the same period a year

ago. The DSR has consistently remained well below

the 17.46 percent “danger threshold” under the

BSP Early Warning System (BSP‐EWS) on Debt

Sustainability.

The external debt ratio, or total outstanding debt

(EDT) expressed as a percentage of GDP, is a

solvency indicator. EDT to GDP increased to

23.7 percent from 21.4 percent a quarter ago as

GDP declined by 16.5 percent while external debt

rose during the reference quarter. Nevertheless,

the ratio continued to be well below the

68.25 percent threshold under the BSP‐EWS model

for assessing debt sustainability, indicating the

country's sustained strong position to service

foreign obligations in the medium to long‐term.

Foreign Interest Rates

In Q2 2020, most advanced economies (AEs)

maintained policy rates and continued to

implement monetary easing measures through

asset purchases to address the risks posed by

the COVID‐19 to global economy.


The US Fed maintains policy rates

The US Fed maintained the target range for the

Federal funds at 0.0‐0.25 percent during its April

and June meetings. The decision was based on the

assessment that the ongoing public health crisis will

continue to pose risks to the economic outlook over

the medium term.

As part of its monetary policy decision, the Fed

decided to increase its holdings of Treasury

securities and its holdings of agency residential and

commercial mortgage‐backed securities.51 As the

US Fed maintained its policy rates, both the

average US prime rate and discount rate decreased

to 3.250 percent and 0.250 percent, respectively,

from the previous quarter’s 4.417 percent and

1.826 percent, also respectively. Similarly, the

average US Fed funds rate declined to 0.055

percent from the 1.228 ‐percent average reported

in the previous quarter (Table 16).

During its May and June meetings, the Bank of

England (BOE) maintained the official bank rate

paid on commercial banks’ reserves at 0.1 percent.

It also increased the stock of UK government bond

purchases by £100 billion to £735 billion.52

The Bank of Japan (BOJ) decided to continue its

“Quantitative and Qualitative Monetary Easing

(QQE) with Yield Curve Control,” in view of

achieving the price stability target of 2 percent.

The BOJ decided to continue such policy until the

target becomes stable. During its May and June

meetings, the BOJ decided to apply a negative

interest rate of 0.1 percent to current accounts

that financial institutions hold at the Bank. For the

long‐term interest rate, the BOJ decided to buy

Japanese government bonds (JGBs) without setting

51Press Release, “Decisions Regarding Monetary Policy Implementation”, 29 April 2020 and 10 June 2020, https://www.federalreserve.gov/newsevents/pressreleases/monetary20200429a1.htm & https://www.federalreserve.gov/newsevents/pressreleases/monetary20200610a1.htm 52Press Release, “Monetary Policy Summary and minutes of the Monetary Policy Committee (MPC) meeting”, 7 May 2020 and 18 June 2020, https://www.bankofengland.co.uk/monetary‐policy‐summary‐and‐minutes/2020/may‐2020 & https://www.bankofengland.co.uk/monetary‐policy‐summary‐and‐minutes/2020/june‐2020

an upper limit in order for the 10‐year JGB yields to

remain at around zero percent.

In terms of asset purchases, the BOJ has decided to

actively purchase exchange‐traded funds (ETFs) and

Japanese real estate investment trusts (J‐REITs)

such that their outstanding amount will increase at

annual paces with the upper limit of about

¥12 trillion and ¥180 billion, respectively. Likewise,

the BOJ decided to maintain its purchases of

commercial papers and corporate bonds by

¥2.0 trillion and ¥3.0 trillion, respectively until the

upper limit of their outstanding amounts reach

¥7.5 trillion for each asset.53

While the European Central Bank (ECB) decided to

maintain the interest rates on the deposit facility,

main refinancing operation, and marginal lending

facility at ‐0.50 percent, 0.0 percent, and

0.25 percent, respectively, during its April and June

meetings, it continued to implement monetary

policy measures to counter the risks posed by the

COVID‐19 outbreak.54 During its June 2020 meeting,

the ECB decided that the Pandemic Emergency

Purchase Program (PEPP) will be increased by

€600 billion to €1,350 billion of asset purchases

to be conducted in a flexible manner over time.

Chart 34. Selected Foreign Interest Rates in percent

53Press Release “Statement on Monetary Policy” 27 April 2020 and 16 June 2020, https://www.boj.or.jp/en/mopo/mpmdeci/state_2020/k200427a.htm/ & https://www.boj.or.jp/en/announcements/release_2020/k200616a.pdf 54Press Release, “Monetary policy decisions” 30 April 2020 and 4 June 2020, https://www.ecb.europa.eu/press/pr/date/2020/html/ecb.mp200430~1eaa128265.en.html & https://www.ecb.europa.eu/press/pr/date/2020/html/ecb.mp200604~a307d3429c.en.html

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

7.0

7.5

Q12017

Q2 Q3 Q4 Q12018

Q2 Q3 Q4 Q12019

Q2 Q3 Q4 Q12020

Q2

US Prime Rate

SIBOR* (90 days)

US Federal Funds Rate

LIBOR (90 days)

US Discount Rate

Source: Bloomberg; Asian Wall Street Journal; Reuters* SIBOR refers to SIBOR rates (in Singapore $)


As AEs maintained their policy rates, benchmark

global interest rates recorded downward trends

during the review period. The 90‐day LIBOR

decreased to 0.602 percent in Q2 2020 from

1.534 percent in the previous quarter. Similarly, the

90‐day Singapore Interbank Offered Rate (SIBOR)

declined to 0.720 percent from 1.556 percent in the

previous quarter.

Global Economic Developments

Global developments in Q2 2020 show that the

economic impact of COVID‐19 pandemic has been

larger‐than‐anticipated and the recovery path will

be slower than what was previously forecasted.

The negative impact has been more evident in

Q2 2020, resulting in the persistent deterioration in

domestic and global financial conditions, greater

disruptions in the supply chain, shifts in spending

patterns, decline in consumer and business

confidence, among others. The IMF (2020) noted

that while reopening of the economy requires the

gradual unwinding of targeted policies, stimulus

measures must continue to be implemented to

support demand and keep businesses afloat. For

the full year 2020, synchronized downturns are

expected in advanced economies (AEs), including

US, Japan, UK, Germany, France, Italy, and Spain.

Meanwhile, a deeper impact on growth is expected

in both emerging markets (EMs) and developing

economies resulting from domestic economic

disruptions and large spillovers from weaker

external demand.55

In the US, growth in Q2 2020 contracted at

9.1 percent, a reversal from the 0.3‐percent growth

in Q1 2020. The contraction reflected negative

contributions from personal consumption

expenditures, gross private domestic investment,

and exports while improvements in government

55 IMF World Economic Outlook Update, 24 June 2020 56 Technical Note, Gross Domestic Product, Second Quarter 2020 (Second Estimate), U.S. Bureau of Economic Analysis (BEA), 27 August 2020 57 Quarterly Estimates of GDP for April‐June 2020 (First Preliminary Estimates), Economic and Social Research Institute, Cabinet Office, Government of Japan, 17 August 2020 58 The Euro area (EA19) includes Belgium, Germany, Estonia, Ireland, Greece, Spain, France, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Austria, Portugal, Slovenia, Slovakia, and Finland. Source: Eurostat 59 “GDP main aggregates and employment estimates for the

consumption expenditures partly offset the decline

in growth.56

Meanwhile, further contraction in GDP was

recorded in Japan and the Euro area. In Japan,

the economy declined by 9.9 percent in Q2 2020

from the 1.8 percent contraction in the previous

quarter.57 The combined drop in domestic demand

and net exports of Japanese goods and services

has contributed largely to the negative growth.

Similarly, GDP in Euro area58 registered a

14.7‐percent decline in Q2 2020, 59 the sharpest

contraction since 1995 following containment

measures in most member countries. The impact

on unemployment, bankruptcies and weak

investments are expected to drag on for some time,

with notable economic slowdown in Spain, Greece,

France, and Italy during the quarter.60

Global uncertainty brought by the pandemic

continues to negatively affect the growth of most

Asian economies. The Hong Kong economy dropped

by 9.0 percent during the review quarter, slightly

below the revised 9.1‐percent contraction in

Q1 2020. This was attributed to the deterioration

in private consumption and gross domestic fixed

capital formation which were slightly offset by

improvement in government consumption

expenditure.61 The South Korean economy

contracted by 2.7 percent in Q2 2020, a reversal

from the 1.4‐percent growth registered in the

previous quarter. The fallout was driven mainly

by weak exports particularly in motor vehicles and

mobile phones. 62 In Singapore, the economy

further declined by 13.2 percent decline in Q2 2020

following the 0.3 percent contraction in Q1 2020.

This was due to the significant slowdown in the

manufacturing, agriculture, forestry and fishing,

services and construction sectors.63

second quarter of 2020”, Eurostat News Release and Euro Indicators, 8 September 2020. 60 Bassetti, M., “Euro Area: Lockdowns strike unprecedented blow to Eurozone economy in Q2”, Focus Economics News, 30 July 2020. 61 “Gross Domestic Product Second Quarter“, Census and Statistics Department, Hong Kong, August 2020. 62 Press Release on “Gross National Income: Second Quarter of 2020 (Preliminary) “, Bank of Korea, 1 September 2020. 63 Press Release on “MTI Narrows 2020 GDP Growth Forecast to ‐7.0 to ‐5.0 Per Cent”, Ministry of Trade and Industry Singapore, 11 August 2020.


In China, economic recovery was registered at

3.2 percent in Q2 2020, 64 a reversal from the

6.8 percent decline in the previous quarter.

Gradual normalization of activities particularly in

the industrial sector supported the recovery, while

cautious consumer spending continues to affect

the accommodation and restaurant industry and

periodic community lockdowns weighed down

renting and leasing activities in the country.

In India, the economy contracted by 23.9 percent

in Q2 2020,65 a reversal from the 3.1 percent

expansion in the previous quarter, driven mainly

by weaker spending in construction, trade, hotel,

transport, communication and services,

manufacturing and mining sectors.

Table E. Real GDP in Selected Economies year‐on‐year growth; in percent

In the ASEAN‐5 region, most member countries

recorded a general downturn in economic activities

during the review quarter, except in Vietnam.

Expansion was recorded in Vietnam at 0.4 percent

in Q2 2020 albeit lower than the 3.8‐percent

expansion in the previous quarter.66 The strong

64 National Bureau of Statistics of China, “Preliminary Accounting Results of GDP for the Second Quarter and First Half Year of 2020”, 17 July 2020. 65 Government of India, Ministry of Statistics and Programmed Implementation, Press Note on “Estimates of Gross Domestic Product for the First Quarter (April‐June) of 2020‐2021,” 31 August 2020. 66 “Socio‐economic situation in the second quarter and the first 6 beginning month of 2020”, General Statistics Office of Vietnam 67 Bank Indonesia, “National Economic Growth Impacted by

growth in manufacturing and services sectors were

offset by weaker global demand.

Meanwhile, the Indonesian economy contracted

by 5.3 percent in the second quarter after

expanding by about 3.0 percent in Q1 2020.

The decline in Q2 2020 was driven mostly by lower

exports and negative performance across all GDP

components including household consumption,

investments and government expenditures.67

A slowdown in the Malaysian economy by

17.1 percent was registered in Q2 2020, a reversal

from the 0.7‐percent expansion in the previous

quarter, primarily attributed to lower exports,

production constraints and marked decline in

tourism activities.68

The Philippine economy posted a 16.5 percent

contraction in Q2 2020 from the 0.7 percent decline

in the previous quarter, driven mainly by weak

supply side growth from the transportation and

storage; construction; manufacturing;

accommodation; industry; and services sectors.69

Likewise, in Thailand, the economy contracted by

12.2 percent in Q2 2020, declining further from the

2.0‐ percent slowdown in the previous period. The

subdued growth was attributed mainly to declines

in exports of goods and services, private

investment, and private final consumption

expenditure which were partly offset by expansion

in government consumption expenditure and public

investment.70

Average headline inflation in the US, Japan, and

Euro area declined to 0.3 percent, 0.1 percent, and

0.2 percent in Q2 2020, respectively. The drop in

energy prices significantly contributed to the lower

inflation rates in US and Euro area while hampered

consumption due to continued lockdown caused

sharp decline in prices in Japan.

In most Asian economies, inflation eased in

Q2 2020. Hong Kong’s average inflation was

COVID‐19 in Q2/2020,” 5 August 2020. 68 Press Release on “Economic and Financial Developments in Malaysia in the Second Quarter of 2020, “Department of Statistics, Malaysia, 14 August 2020. 69 “GDP growth rate drops by 26.5 percent in the second quarter of 2020: the lowest starting 1981 series,” Philippine Statistics Authority Press Release, 6 August 2020 70 “Gross Domestic Product: Q2 2020,” Office of the National Economic and Social Development Council (NESDC), 17 August 2020.

2019

Q2 Q1 Q2

Advanced Economies

US 2.0 0.3 ‐9.1

Japan 0.9 ‐1.8 r ‐9.9

Euro Area 1.2 r ‐3.2 r ‐14.7

Hong Kong 0.4 ‐9.1 r ‐9.0

South Korea 2.1 1.4 r ‐2.7

Singapore 0.2 ‐0.3 r ‐13.2

Emerging and Developing Asia

China 6.2 ‐6.8 3.2

India 5.2 3.1 ‐23.9

ASEAN‐5

Indonesia 5.1 3.0 ‐5.3

Malaysia 4.8 0.7 ‐17.1

Philippines 5.4 ‐0.7 r ‐16.5

Thailand 2.4 ‐2.0 r ‐12.2

Vietnam 6.8 3.8 0.41 Country grouping is based on the IMF World Economic Outlook Database,

April 2020r Revised

Source: Bloomberg and country websites

Country Grouping 1 2020


recorded at 1.4 percent, lower than the previous

quarter’s 2.0 percent, driven mainly by slower price

movement in food, housing and miscellaneous

services. Singapore's average deflation stood at

0.7 percent during the review period following

faster decline in miscellaneous goods and services,

and recreation and culture costs, although partly

offset by softer decline in transport, clothing and

footwear, and health prices. In South Korea, lower

consumer prices such as transportation and

education resulted in an average deflation rate

of 0.1 percent, down from the 1.2 percent inflation

recorded in Q1 2020. Consumer prices in China

dropped in Q2 2020 causing inflation to ease to

2.7 percent from the previous quarter’s

5.0 percent. Similarly, inflation in India dropped to

5.2 percent from the previous quarter’s 6.6 percent

due to the sharp decline in food and beverage

prices.

Table F. Inflation in Selected Economies quarterly average, in percent

In the ASEAN‐5 region, average inflation rates were

generally lower in Q2 2020. In Indonesia, inflation

fell slightly to 2.3 percent from 2.9 percent a

quarter ago. Similarly, the Philippine inflation rate

dropped to 2.3 percent in Q2 2020 from 2.7 percent

in the previous quarter. Meanwhile, lower prices of

petrol following government price‐control

measures as well as declined transportation;

housing and construction materials; textiles,

footwear, hats; and education costs contributed

to Vietnam’s inflation rate of 2.8 percent during

the review quarter. In Malaysia, the decline in

consumer prices and plunge in transport prices

resulted in a deflation rate of 2.6 percent in

Q2 2020 from the 0.9 percent inflation rate in

Q1 2020. In Thailand, lower prices following the

end of government utilities subsidy resulted in the

deflation rate of 2.7 percent.

The global labor market was severely hit by the

decline in market activities following the global

health crisis since Q1 2020. Uptick in

unemployment rates were recorded in US, Japan,

and Euro area at 13.0 percent, 2.8 percent, and

7.5 percent, respectively, during the review period.

Similarly, unemployment rates grew in Hong Kong,

South Korea and Singapore at 5.8 percent,

4.2 percent and 2.9 percent, respectively.

Table G. Unemployment Rates in Selected Economies in percent

In Asia, unemployment rates significantly rose

during the review quarter in Malaysia (5.1 percent),

and Philippines (17.7 percent) while minimal

increase was recorded in China (3.8 percent) and

Vietnam (2.7 percent).

2019

Q2 Q1 Q2

Advanced Economies

US 1.8 2.1 0.3

Japan 0.8 0.5 0.1

Euro Area 1.4 1.1 0.2

Hong Kong 3.0 2.0 1.4

South Korea 0.7 1.2 ‐0.1

Singapore 0.8 0.4 ‐0.7


China 2.6 5.0 2.7

India 8.5 6.6 5.2

ASEAN‐5

Indonesia 2.9 2.9 2.3

Malaysia 0.6 0.9 ‐2.6

Philippines 3.0 2.7 2.3

Thailand 1.1 0.4 ‐2.7

Vietnam 2.7 5.6 2.81 Country grouping is based on the IMF World Economic Outlook Database,

April 2020


2020Country Grouping

1

2019

Q2 Q1 Q2

Advanced Economies

US 3.6 3.8 13.0

Japan 2.4 2.4 2.8

Euro Area 7.6 7.3 7.5

Hong Kong 2.8 3.8 5.8

South Korea 4.0 3.7 4.2

Singapore 2.2 2.4 2.9


China 3.6 3.7 3.8

India n.a. 5.0 n.a.

ASEAN‐5

Indonesia n.a. 5.0 n.a.

Malaysia 3.3 3.5 5.1

Philippines 5.1 5.3 17.7

Thailand 1.0 1.1 n.a.

Vietnam 2.2 2.2 2.71 Unemployment rate is the proportion (in percent) of the total number of

unemployed as a percentage of the labor force.2Country grouping is based on the IMF World Economic Outlook Database,

April 2020


2020Country Grouping

2


Financial Condition of the BSP

Balance Sheet

As of end‐June 2020, preliminary data showed that

the BSP’s total assets amounted to ₱6,295.4 billion,

notably higher by 15.7 percent from the quarter‐

ago level of ₱5,441.1 billion. Likewise, against its

year‐ago balance, total assets grew higher by

24.3 percent from ₱5,064.5 billion (Table17).

During the same review period, the BSP’s liabilities

grew by 15.6 percent to ₱6,130.9 billion from

the previous quarter’s balance of ₱5,305.5 billion.

Relative to the end‐June 2019 level ₱4,920.2 billion,

total liabilities rose by 24.6 percent or by ₱1,210.7

billion.

BSP’s net worth remains strong at end-Q2 2020

Consequently, the BSP’s net worth as of

end‐June 2020 reached ₱164.5 billion or

21.3 percent above the quarter‐ago level of

₱135.6 billion. The resulting net worth was likewise

higher by 14.0 percent relative to the ₱144.3 billion

figure posted in the same period last year.

The BSP’s financial condition remains strong

with total assets being dominated by international

reserves amounting to ₱4,618.6 billion as of

end‐June 2020. Compared with the quarter‐ago

balance of ₱4,484.2 billion, the end‐June 2020

balance was higher by 3.0 percent or ₱134.4 billion.

The quarterly rise in the reported peso equivalent

of international reserves was largely due to the

inflows arising from both the BSP’s foreign

exchange operations and the National

Government’s (NG) net foreign currency deposits

with the BSP. These were partially offset by NG

payments of foreign currency obligations.71

Meanwhile, the BSP’s liabilities of ₱6,130.9 billion

during the review period were comprised mostly

71 Also due to the gradual appreciation of the Philippine peso

of deposits and currency issues. The deposits were

largely supported by placements in reserve deposits

of Other Depository Corporations (ODCs), deposits

from Overnight Deposit Facility, and deposits from

the Treasurer of the Philippines.

Table H. Balance Sheet of the BSP in billion pesos

Income Statement

Based on preliminary data, the BSP registered a

net income of ₱3.8 billion for the quarter ending

June 2020. The decreased quarterly net income

was primarily the result of lower interest income

on reserves and reduced miscellaneous income

(Table 18).

BSP registers lower profits in Q2 2020

Total revenues for the review quarter amounted

to ₱20.8 billion or 20.4 percent lower than the

₱26.1 billion posted in the previous quarter. Total

revenues were mostly comprised of interest income

on reserves and domestic securities, and

miscellaneous income.

Table I. Income Position of the BSP in billion pesos

against the US dollar during the quarter.

Jun Mar r Jun

Assets 6,295.4 5,441.1 5,064.5

Liabilities 6,130.9 5,305.5 4,920.2

Net Worth 164.5 135.6 144.3

Note: Details may not add up to to tal due to rounding.p Based on the preliminary and unaudited BSP Financial

Statements prepared by the Financial Accounting

Department (FAD) of the BSP.r Revised to reflect latest end-month figures for M arch 2020

based on the unaudited BSP FS as of end-M arch 2020.

Source: BSP

2020 p 2019

Q2 Q1 Q2

Revenues 20.786 26.124 38.906

Less: Expenses 16.405 18.225 22.483

4.381 7.899 16.423

Net Gain/(Loss) on FX Rate Fluctuations ‐0.441 2.021 3.330

Income Tax Expense/(Benefit) 0.141 0.005 3.000

Net Income/(Loss) After Tax 3.799 9.915 16.753

Note: Details may no t add up to total due to rounding.p Based on the preliminary and unaudited BSP Financial Statements.

Source: BSP

2020 p 2019

Net Income/(Loss) Before Gain/(Loss) on FX Rate

Fluctuations and Income Tax Expense/(Benefit)


Total expenditures, as compared to the previous

quarter, slightly decreased by ₱1.8 billion or

10.0 percent to reach ₱16.4 billion. The q‐o‐q drop

in expenditures was due to lower interest expense

on Term Deposit Facility and Reverse Repurchase

Facility. Furthermore, the reduced costs on bank

note production and coin minting contributed to

the overall decline in expenditures.

Conclusion, Challenges and Policy Directions The Philippine economy took a significant beating in

Q2 2020, falling into a technical recession as the

economic impact from the COVID‐19 pandemic

turned out to be more negative than earlier

anticipated. The imposition of strict community

quarantines during the review period substantially

dampened domestic demand and weighed down

the performance of traditional growth sectors. In

addition, the global nature of the pandemic has also

adversely affected the country’s external sector

accounts such as trade, investments, remittances,

and travel receipts as downturns were also seen in

partner‐countries.

At the start of the quarter, it was recognized that

the pandemic could pose a long‐drawn‐out drag on

economic activity if the health issue was not

primarily addressed. Thus, in the absence of a cure

or vaccine, lockdown measures which were already

imposed on major cities in March 2020 were

extended further for the most part of Q2 2020 to

allow the health sector to manage the virus

contagion and contain its transmission. The possible

implications of these measures are two‐fold: the

economic fallout from the adverse impact of

lockdowns on business operations could be deep;

and the implications on productivity for surviving

businesses as they introduce stringent safety

practices in the workplace could result in a much

slower recovery.

To avert a permanent economic scarring, policy

efforts took a whole‐of‐government approach to

cushion the impact of containment measures on

households and firms as well as to ensure that

economic recovery can begin once the pandemic is

effectively managed and economic activity

gradually resumes. To this end, the NG

implemented a four‐pillar strategy equivalent to

9.1 percent of GDP as of 19 May 2020. Pillars 1 and

2 pertain to the social support and health response

programs to cushion the impact of the containment

measures and eradicate the spread of the virus.

Meanwhile, Pillar 3 refers to fiscal and monetary

policy actions intended to support and finance

the economic recovery program in Pillar 4.

The role of the BSP is significant in Pillar 3. To this

end, the BSP implemented prompt and decisive

policy actions in Q2 2020 to ease monetary

conditions and enhance financial system liquidity

to prop up market confidence and support

economy activity amid the pandemic. The benign

inflation outlook as well as the well‐anchored

inflation expectations that are within the

government’s 2‐4 percent target range have

allowed the BSP to remain supportive of an

accommodative policy stance. This, in turn, should

provide for favorable borrowing conditions and

ensure ample credit and liquidity in the financial

system to support the Philippine economy.

Moreover, the BSP has sufficient space to pursue

additional monetary policy actions if necessary.

Looking ahead, domestic economic activity is

projected to follow a gradual U‐shaped quarterly

recovery path with output likely to contract in the

remaining quarters of 2020. GDP growth is

expected to accelerate back towards its long‐run

trend in 2021 as government policy measures gain

full traction.

Finally, the pandemic has highlighted the need for

the BSP to remain committed to its reform agenda

and advocacies. The BSP Charter, as amended, has

among others, restored the BSP’s authority to issue

its own securities as part of its regular monetary

operations. The additional monetary instrument is

seen to enhance further the transmission of the

BSP’s policy stance to the economy, as well as

contribute towards the development of the

domestic capital market. The first issuance of the

BSP bills and bonds is scheduled within Q3 2020.


Moreover, as part of its financial inclusion

advocacy, the BSP looks forward to accelerating

digital transformation over the next few years.

The shift to electronic transactions during the

quarantine period was further encouraged by the

BSP through a time‐bound waiver of fees for digital

financial services. The BSP aims for the volume of

electronic retail payments to reach 50 percent by

2023.

The BSP has shown decisiveness and readiness in its

policy responses amid the challenges in Q2 2020. In

the months ahead, the BSP will continue to remain

vigilant and data‐driven in ensuring that

appropriate monetary and financial policy measures

are in place. Moreover, the BSP remains committed

to deploying its full range of instruments as needed

in the fulfillment of its mandate to promote non‐

inflationary and sustainable growth over the

medium term.


Annexes Annex A. Banking Policies

Alternative Compliance with the Reserve

Requirements of Banks and Non‐Bank Financial

Institutions with Quasi‐Banking Functions (NBQBs)

(BSP Circular No. 1087 dated 27 May 2020)

The Bangko Sentral ng Pilipinas (BSP) issued

amendments to the Manual of Regulations for

Banks (MORB) and the Manual of Regulations for

Non‐Bank Financial Institutions (MORNBFI) to

recognize loans granted to micro‐, small‐and

medium enterprises (MSMEs) and loans to large

enterprises as alternative reserve compliance until

end‐2021, subject to the following conditions:

(1) The loan was granted, renewed or

restructured after 15 March 2020;

(2) A loan that was granted on or before

15 March 2020 but has been renewed or

restructured after 15 March 2020 may be

used as alternative compliance with the

reserve requirements: Provided, that the

bank demonstrates an increase in its MSME

loan portfolio or loan portfolio to large

enterprises during the month preceding the

reserve day. For purposes of determining the

increase in the bank's loan portfolio, the bank

shall exclude accrued interest and accumulated

charges which have been capitalized or made

part of the principal of restructured loans; and

(3) The loan is not hypothecated or encumbered

in any way, or rediscounted with the BSP or

earmarked for any other purpose.

Amendments to the Regulations on Treasury

Activities of BSP‐Supervised Financial Institutions

(BSFIs) (BSP Circular No. 1088 dated 11 May 2020)

The BSP Monetary Board (MB), in its Resolution No.

566 dated 24 April 2020 approved the amendments

to the regulations on treasury activities of BSFIs.

In this regard, Section 611/611‐Q of the Manual of

Regulations for Banks/Manual of Regulations for

Non‐Bank Financial Institutions is hereby amended

as follows:

In accordance with the duty of BSFIs’ board of

directors to articulate acceptable, and unacceptable

activities, transactions and behaviors (collectively

referred to as “unacceptable practices”), it must

adopt a code of conduct and standards of practice

that are binding on the Treasury unit, especially

those personnel involved in risk‐taking.

The code and standards should highlight and

provide specific guidance on upholding market

integrity and professionalism. Unacceptable

practices refer to (a) practices that undermine

market integrity, which include engaging in trading

transactions which have the effect, or are likely to

have the effect, of creating a false or misleading

appearance of active trading in any security,

currency or commodity, or with respect to the

market for, or the price of, any security, currency

or commodity (e.g., pre‐arranged transactions,

wash sales, painting the tape and marking the

close); and (b) practices that result in the

misstatement of the BSFI’s financial condition,

results of operations, disclosures and prudential

reports. The code and standards should likewise

include safeguards to prevent conflict of interest

or self‐dealing in any form when allowing personnel

to deal for their own account.

Amendments to the Regulations on the Foreign

Currency Deposit System (BSP Circular No. 1086

dated 6 May 2020)

The BSP has eased the asset cover requirement of

banks with expanded/foreign currency deposit units

(E/FCDUs) to provide the covered institutions with

greater flexibility to manage their foreign currency

exposures.

Existing regulations require banks to maintain a

100 percent asset cover for their foreign currency

liabilities in the E/FCDUs at all times to ensure that

they have sufficient foreign currency‐denominated

assets to service withdrawals of deposits and meet

payments denominated in foreign currency. Under

the new rules, banks shall be allowed to offset any

deficiency in the asset cover incurred on one or

more days of the week with the excess cover that

they may hold on other days of the same week and


the immediately succeeding week. This provides

the banks greater leeway in managing their foreign

currency exposures in accordance with their risk

tolerance and internal policies.

The MB has likewise approved the alignment of the

licensing process for applications for E/FCDU

authority with the risk‐based licensing framework

being implemented by the BSP pursuant to Circular

No. 1031, which was issued in February 2019. The

operation of an E/FCDU is considered as a Type A

permissible activity under the framework. The

attendant requirements have been streamlined in

order to promote the ease of doing business.

Sustainable Finance Framework (BSP Circular No.

1085 dated 29 April 2020)

The BSP MB approved the sustainable finance

policy framework that sets out the expectations of

the BSP on the integration of sustainability

principles, including those covering environmental

and social (E&S) risk areas, in the corporate

governance and risk management frameworks as

well as in the strategic objectives and operations of

banks.

The BSP is cognizant that climate change and other

environmental and social risks could pose financial

stability concerns considering their significant and

protracted implications on the bank's operations

and financial interest. In particular, physical and

transition risks arising from climate change could

result in significant societal, economic and financial

risks affecting the banks and their stakeholders.

The BSP likewise recognizes the critical role of the

financial industry in pursuing sustainable and

resilient growth by enabling environmentally and

socially responsible business decisions consistent

with the aspirations set out for the Filipinos under

the Philippine Development Plan.

The BSP expects banks to embed sustainability

principles, including those covering environmental

and social risk areas, in their corporate governance

framework, risk management systems, and

strategic objectives consistent with their size,

risk profile and complexity of operations.

Sustainable Finance refers to any form of financial

product or service which integrates environmental,

social and governance criteria into business

decisions that supports economic growth and

provides lasting benefit for both clients and society

while reducing pressures on the environment.

This also covers green finance which is designed to

facilitate the flow of funds towards green economic

activities and climate change mitigation and

adaptation projects.

The said framework shall apply to all banks.

Branches of foreign banks may adopt the relevant

policies and strategies of their head office that are

consistent with applicable provisions.

The framework enumerated the list of duties

and responsibilities expected from the board of

directors and senior management, consistent with

the expectations to promote the long‐term financial

interest of the bank and ensure that it has

beneficial influence on the economy.

Banks were given a period of three (3) years to

fully comply with the provisions of the sustainable

finance framework. In this regard, banks shall adopt

a transition plan with specific timelines to

implement the board‐approved strategies and

policies related to the framework. Banks shall

provide its board‐approved transition plan upon

request of the BSP.

Amendments to the Risk‐Based Capital Adequacy

Frameworks for Banks/Quasi‐Banks (BSP Circular

No. 1084 dated 28 April 2020)

The MB approved prudential measures to assist the

micro‐, MSME sector carry on with its business

during the COVID‐19 crisis, as well as hasten

recovery and sustainability of MSME operations in

the post‐crisis period.

The MSME sector is a vital component of the

Philippine economy owing to its capacity to

generate employment and contribute to economic

The first set of measures by the BSP are

amendments to the regulatory capital treatment of

exposures to MSMEs, which free up capital and

enable supervised financial institutions to extend

more credit to the MSME sector.

These include the: (a) temporary reduction in the

credit risk weights of loans granted to MSMEs that

are current in status, and (b) assignment of a lower


risk weight for MSME exposures that are covered

by guarantees.

a. Temporary reduction in the credit risk weight

of MSME loans. The credit risk weight of loans

granted to MSMEs that are in current status was

reduced to 50 percent from 75 percent (for

diversified MSME portfolio with at least

500 borrowers over a number of industries) and

100 percent (for non‐diversified MSME portfolio).

The reduced credit risk weight is subject to review

by the BSP by end‐December 2021.

b. Assignment of zero percent risk weight for

MSME loans that are covered by guarantees. The

BSP approved the assignment of a zero‐percent

risk weight not only to loans that are guaranteed

by the Philippine Guarantee Corporation but also

to loans that are guaranteed by the Agricultural

Guarantee Fund Pool and the Agricultural Credit

Policy Council. The revision in the credit risk

weight complements programs of the National

Government that support financing to MSMEs

as well as small farmers and fisherfolk.

To enable stand‐alone thrift banks, rural banks and

cooperative banks to continue to support their

MSME‐ and rural community‐based clients, the

BSP deferred the implementation of the revised

risk‐based capital framework applicable to these

banks under Circular No. 1079 dated 9 March 2020.

The revised capital adequacy framework will

now take effect on 1 January 2023 instead of

1 January 2022. Moreover, the observation period

of the revised framework will be extended from

31 December 2021 to 31 December 2022.

The observation period provides these banks

with enough time to meet the new minimum

capital ratios through reasonable measures

without disrupting their banking activities.

Lastly, the BSP lengthened the period of relief on

the reporting of past due and non‐performing loans

of borrowers affected by COVID‐19 to 31 December

2021 from the original timeline of 8 March 2021,

subject to reporting to the BSP.

72 Source: Media releases from the BSP, PSE. and SEC for the

These policy issuances reinforce earlier

pronouncements of the BSP which recognize

MSME loans as alternative compliance with

the reserve requirement as well as relax the

Know‐Your‐Customer requirements for retail

clients to facilitate their access to formal

financing channels.

Overall, these measures are expected to channel

liquidity directly to the MSME sector while ensuring

the health and safety of the financial system.

Annex B. Capital Market Reforms72

Extension of financial relief to borrowers

The SEC directed lending and financing companies

to comply with the “Bayanihan to Heal As One Act”,

which makes a mandatory nationwide moratorium

on loan payments, deferring the collection of

payments and charging of penalties amid the state

of national emergency due to the COVID‐19

pandemic. The implementing rules and regulations

(IRR) of Section 4 of the Bayanihan Law or Republic

Act No. 11469 covers loans extended to individuals,

households, MSMEs, corporate borrowers and

other counterparties.

Ensure sufficient liquidity in the financial system

To ensure sufficient liquidity in the financial

system, the BSP implemented a number of

liquidity‐enhancing policies intended to reassure

markets and restore business confidence, which

include, among others:

₱300 billion (around US$5.9 billion) GS

purchases from the National Government under

repurchase agreement with a term of 3 months,

extendible by another three months subject to

MB approval; and

Purchases of peso‐denominated GS from banks

in the secondary market

period April to June 2019.


Promotion of continued access to financial services

The SEC approved the issuance of social bonds

to support efforts to contain the COVID‐19

pandemic, manage the resulting socioeconomic

impacts and build resilience to future shocks. Social

bonds are financing instruments whose proceeds

are exclusively used to finance or refinance new or

existing projects that directly aim to address or

mitigate a specific social issue and/or seek to

achieve positive social outcomes. During the

ongoing pandemic, the Commission cited the

potential of the social bond market as a funding

source for promotion of public health, reopening of

businesses and preservation of jobs, and other

COVID‐19‐focused projects. On 17 June 2020, the

SEC approved the country’s first social bond

issuance from the Bank of the Philippine Islands

(BPI), which aims to finance and refinance eligible

MSMEs. BPI’s ₱3.0 billion COVID‐19 Action

Response (CARE) Bonds is in accordance with the

ASEAN Social Bond Standards (SBS).

The BSP also approved a package of measures to

further reduce the financial burden on loans to

MSMEs. These measures include, among others,

reduction of credit risk weights of loans granted to

MSMEs. These likewise complement earlier

monetary actions taken by the BSP to shore up

market confidence and cushion domestic economic

activity, along with various time‐bound relaxation

of various regulations, calculation of penalties on

required reserves, and adjustments in the single

borrower’s limits.73

Manage extreme market volatility

The PSE incorporated a new three‐level circuit

breaker to help manage increased volatility in the

stock market. The previous single level circuit

breaker has been tripped four times since it was

adopted in September 2008, on 27 October 2008

and on 12, 13, and 19 March 2020. The adjustments

are emergency measures necessary to protect

investors and maintain order in the market.

The Level 1 circuit breaker will still be based on

the original circuit breaker policy introduced in

2008, where a 15‐minute market‐wide halt is

73 See Section on Banking Policies for other regulatory relief

implemented when the PSEi drops by 10 percent

from the previous trading session’s level.

The Level 2 circuit breaker is tripped when the

PSEi falls by 15 percent from the previous trading

day’s closing level and involves a 30‐minute

trading halt.

The Level 3 circuit breaker will be triggered,

and trading will be halted for one (1) hour if the

PSEi plunges by 20 percent from the previous

trading session’s closing level.

Encourage the use of e‐payment while

strengthening cybersecurity

The BSP encouraged the use of e‐payments amid

the Luzon‐wide ECQ during the quarter. This was to

minimize face‐to‐face transactions and prevent the

spread of COVID‐19. The BSP Governor urged the

public to use e‐payment services when purchasing

essentials like food and medicines, when

transferring money to accounts of loved ones, and

when paying utility bills, loans and other

obligations. Usage of e‐payments reduces people’s

need for mobility, helps prevent health risks of

physical contact during over‐the‐counter

transactions, partially addresses difficulties of

providing cash supply to ATMs and bank branches,

and supports the general objectives of the ongoing

ECQ.

With more Filipinos turning to digital

transactions amid the COVID‐19 pandemic,

the SEC advised corporations to strengthen their

cybersecurity in their operations and systems and

craft the appropriate policies and measures, in light

of recent reports of hacking incidents. The SEC

noted that the COVID‐19 pandemic has amplified

the advantages of digital technologies, as

companies shifted to low‐touch and online‐only

services in response to the stringent social

distancing and quarantine measures imposed

across the world. In the Philippines, digital

technologies have allowed some companies to

sustain their operations while the country was

placed under ECQ. As digital transactions increased,

however, reports of phishing attempts, data

breaches and other cyber‐attacks likewise emerged.

measures implemented by the BSP during the quarter.


AE Advanced Economies

AFF Agriculture, Fishery, and Forestry

AONCR Areas Outside the National Capital Region

ASEAN Association of Southeast Asian Nations

BEA Bureau of Economic Analysis (US)

BIR Bureau of Internal Revenue

BLE Bureau of Local Employment

BOC Bureau of Customs

BOE Bank of England

BOJ Bank of Japan

BOP Balance of Payments

BPI Bank of the Philippine Islands

BPO Business Process Outsourcing

BP Basis Point

BSFI Bangko Sentral‐Supervised Financial Institutions

BSP Bangko Sentral ng Pilipinas

BTr Bureau of the Treasury

CAR Capital Adequacy Ratio

CARE COVID‐19 Action Response

CCR Credit Card Receivable

CDS Credit Default Swap

CET1 Common Equity Tier 1

COVID‐19 Coronavirus Disease

CPI Consumer Price Index

CREATE Corporate Recovery and Tax Incentives for Enterprises

CTRP Comprehensive Tax Reform Program

DA Department of Agriculture

DBCC Development Budget Coordination Committee

DBM Department of Budget Management

DOLE Department of Labor and Employment

DSB Debt Service Burden

DSR Debt Service Ratio

ECB European Central Bank

ECQ Enhanced Community Quarantine

EDT Total External Debt

E/FCDUs Expanded/Foreign Currency Deposit Units

EM Emerging Market

EMBIG Emerging Market Bond Index

ETF Exchange‐Traded Funds

FCD Foreign Currency Deposit

FDI Foreign Direct Investment

FPI Foreign Portfolio Investment

FRTB Fixed‐Rate Treasury Bond

FX Foreign Exchange

FXTN Fixed‐Income Treasury Note

GCQ General Community Quarantine

GDP Gross Domestic Product

GIR Gross International Reserves

GNPL Gross Non‐Performing Loan

GOCC Government Owned‐ and Controlled‐Corporations

GS Government Securities

IMF International Monetary Fund

IRR Implementing Rules and Regulations

JCRA Japan Credit Rating Agency

JGB Japan Government Bond

J‐REIT Japanese Real Estate Investment Trust

LCY Local Currency

LEM Loans Especially Mentioned

LFPR Labor Force Participation Rate

LFS Labor Force Survey

LGU Local Government Unit

LIBOR London Interbank Offered Rate

MB Monetary Board

MLT Medium‐ to Long‐Term

MORB Manual of Regulations for Banks

MORNBFI Manual of Regulations for Non‐Bank Financial Institutions

MOS Monetary Operations System

MPC Monetary Policy Committee

MSME Micro, Small and Medium Enterprises

MVL Motor Vehicle Loan

NBQBs Non‐Banks with Quasi‐Banking Functions

NCMB National Conciliation and Mediation Board

NCR National Capital Region

NEDA National Economic and Development Authority

NEER Nominal Effective Exchange Rate

NESDC National Economic and Social Development Council

NFA Net Foreign Assets

NG National Government

NIR Net International Reserves

NNPL Net Non‐Performing Loan

NPSA National Payment Systems Act

NWPC National Wages and Productivity Commission

ODC Other Depository Corporation

ODF Overnight Deposit Facility

OF Overseas Filipino

OLF Overnight Lending Facility

PDEx Philippine Dealing and Exchange Corporation

P/E Price Earnings

PEPP Pandemic Emergency Purchase Program

PhilPass Philippine Payments and Settlements System

PMI Purchasing Managers’ Index

POEA Philippine Overseas Employment Administration

PPP Public‐Private Partnership

ppt Percentage Point PSA Philippine Statistics Authority PSE Philippine Stock Exchange PSEi Philippine Stock Exchange Index QB Quasi Bank

q‐o‐q Quarter‐on‐Quarter

QQE Quantitative and Qualitative Monetary Easing

RB Rural Bank

RCEF Rice Competitiveness Enhancement Fund

REER Real Effective Exchange Rate

List of Acronyms, Abbreviations, and Symbols


ROP Republic of the Philippines

RREL Residential Real Estate Loan

RRP Reverse Repurchase

RRR Reserve Requirement Ratio

RTB Retail Treasury Bond

SBL Substandard or Below Loans

SBGPCL Salary‐Based General PurposeConsumption Loans

SBS Social Bond Standards

SDR Special Drawing Rights

SEC Securities and Exchange Commission

SIBOR Singapore Interbank Offered Rate

SRC Securities Regulation Code

ST Short Term

T‐bill Thrift Bank

T‐bond Treasury Bill

TDF Term Deposit Facility

TLP Total Loan Portfolio

TPI Trading Partners Index

TPI‐A Trading Partners Index‐Advanced Countries

TPI‐D Trading Partners Index‐Developing Countries

UK United Kingdom

U/KB Universal and Commercial Bank

y‐o‐y Year‐on‐Year

y‐t‐d Year‐to‐Date

List of Acronyms, Abbreviations, and Symbols


Report on Economic and Financial Developments Second Quarter 2020 Statistical Tables

1 Gross National Income and Gross Domestic Product by Industrial Origin

1a Gross National Income and Gross Domestic Product by Expenditure Shares

2 Selected Labor, Employment and Wage Indicators

3 Cash Operations of the National Government

4 Consumer Price Index in the Philippines

4a Consumer Price Index in the National Capital Region

4b Consumer Price Index in Areas Outside the National Capital Region

5 Monetary Indicators

6 Selected Domestic Interest Rates

7 Number of Financial Institutions

8 Total Resources of the Philippine Financial System

9 Ratios of Non‐Performing Loans and Loan Loss Provisions to Total Loans of the Banking System

10 Stock Market Transactions

11 Balance of Payments

12 International Reserves of the Bangko Sentral ng Pilipinas

13 Exchange Rates of the Peso (Peso per Unit of Foreign Currency)

13a Exchange Rates of the Peso (Unit of Foreign Currency per Peso)

13b Effective Exchange Rate Indices of the Peso

14 Total External Debt

15 Selected Foreign Debt Service Indicators

16 Selected Foreign Interest Rates

17 Balance Sheet of the Bangko Sentral ng Pilipinas

18 Income Statement of the Bangko Sentral ng Pilipinas

1 GROSS NATIONAL INCOME AND GROSS DOMESTIC PRODUCT BY INDUSTRIAL ORIGINfor periods indicated

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Agriculture, Forestry and Fishing 427.6 406.6 388.4 520.5 438.5 406.8 388.6 528.7 440.9 409.8 400.1 533.1 439.7 416.4

Industry 1,220.7 1,355.8 1,194.9 1,431.2 1,305.8 1,456.8 1,274.2 1,545.7 1,370.3 1,493.3 1,342.4 1,638.0 1,324.0 1,151.8

Mining and Quarrying 41.6 51.0 30.4 37.0 43.9 49.8 30.0 39.7 45.4 56.8 28.9 38.1 35.9 42.9

Manufacturing 813.3 833.6 726.4 944.4 865.4 891.6 755.2 976.2 910.6 909.8 762.0 1,017.8 875.8 716.5

Electricity, Steam, Water and Waste Management 116.4 133.7 147.0 126.1 125.3 140.8 155.7 135.3 129.5 152.2 167.0 145.2 135.9 143.3

Construction 249.4 337.6 291.1 323.7 271.2 374.7 333.4 394.6 284.7 374.4 384.5 436.9 276.5 249.1

Services 2,311.7 2,674.9 2,559.3 2,684.3 2,471.2 2,856.8 2,734.5 2,857.6 2,646.5 3,071.6 2,933.4 3,089.2 2,662.3 2,586.6

Wholesale and Retail Trade; Repair of

Motor Vehicles and Motorcycles 633.6 751.5 819.2 853.3 666.9 798.8 863.0 908.7 713.6 867.1 934.8 985.5 727.2 753.2

Transportation and Storage 163.3 185.0 141.0 158.9 177.7 199.2 156.4 164.6 189.7 211.3 168.7 172.4 168.0 86.2

Accommodation and Food Service Activities 90.0 87.0 93.8 100.3 100.5 94.1 100.6 108.1 106.5 98.8 106.6 116.5 89.1 31.6

Information and Communication 110.6 123.4 109.4 140.2 119.6 133.2 114.5 148.5 131.5 140.6 120.8 156.5 138.2 149.9

Financial and Insurance Activities 335.7 368.3 336.1 342.4 365.0 400.1 364.3 368.7 409.0 442.9 411.1 413.2 446.3 473.0

Real Estate and Ownership of Dwellings 266.6 284.6 296.0 281.9 283.2 302.7 312.6 291.2 297.7 317.5 331.9 304.3 290.8 253.6

Professional and Business Services 227.6 305.4 287.5 296.7 239.6 316.6 298.9 304.1 242.4 326.0 306.9 310.8 242.9 266.1

Public Administration and Defense;

Compulsory Social Activities 143.4 185.9 158.9 178.2 162.3 213.8 187.2 204.3 181.3 238.2 203.4 247.9 191.4 258.0

Education 165.0 192.1 163.4 151.4 174.0 202.7 181.6 173.3 182.9 227.1 185.3 181.1 184.9 199.3

Human Health and Social Work Activities 73.9 88.3 73.6 73.5 75.4 86.8 72.2 73.8 77.7 86.3 76.3 80.6 81.4 73.0

Other Services 101.9 103.5 80.3 107.5 107.0 108.7 83.2 112.2 114.2 115.9 87.5 120.4 102.1 42.8

Gross Domestic Product 3,960.0 4,437.3 4,142.6 4,636.0 4,215.6 4,720.4 4,397.2 4,932.0 4,457.6 4,974.7 4,675.9 5,260.2 4,426.0 4,154.8

Net Primary Income from the Rest of the World 488.0 468.2 472.4 479.5 499.4 463.9 497.9 485.9 491.3 465.4 475.2 472.2 462.4 362.9

Gross National Income 4,448.0 4,905.6 4,615.1 5,115.6 4,715.0 5,184.3 4,895.2 5,417.9 4,949.0 5,440.1 5,151.1 5,732.4 4,888.5 4,517.8

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Agriculture, Forestry and Fishing 5.1 6.4 3.5 2.5 2.6 . . 1.6 0.5 0.7 3.0 0.8 ‐0.3 1.6

Industry 5.4 7.0 8.4 7.2 7.0 7.5 6.6 8.0 4.9 2.5 5.4 6.0 ‐3.4 ‐22.9

Mining and Quarrying ‐10.3 9.6 3.8 7.0 5.5 ‐2.4 ‐1.6 7.3 3.4 14.2 ‐3.5 ‐4.0 ‐21.0 ‐24.5

Manufacturing 5.0 8.0 11.0 8.6 6.4 7.0 4.0 3.4 5.2 2.0 0.9 4.3 ‐3.8 ‐21.3

Electricity, Steam, Water and Waste Management 2.6 3.9 4.9 6.7 7.7 5.3 5.9 7.3 3.4 8.1 7.3 7.3 4.9 ‐5.8

Construction 11.7 5.6 4.7 3.8 8.7 11.0 14.5 21.9 5.0 ‐0.1 15.3 10.7 ‐2.9 ‐33.5

Services 7.1 7.4 7.8 7.2 6.9 6.8 6.8 6.5 7.1 7.5 7.3 8.1 0.6 ‐15.8


Motor Vehicles and Motorcycles 7.2 5.8 7.0 7.5 5.3 6.3 5.3 6.5 7.0 8.6 8.3 8.5 1.9 ‐13.1

Transportation and Storage 10.1 8.4 3.5 6.6 8.8 7.7 10.9 3.6 6.8 6.1 7.9 4.7 ‐11.4 ‐59.2

Accommodation and Food Service Activities 9.2 13.0 12.1 12.2 11.6 8.2 7.2 7.7 6.0 4.9 6.0 7.8 ‐16.4 ‐68.0



Real Estate and Ownership of Dwellings 3.8 7.4 6.5 4.8 6.2 6.4 5.6 3.3 5.1 4.9 6.2 4.5 ‐2.3 ‐20.1

Professional and Business Services 9.5 10.4 11.2 10.4 5.3 3.7 4.0 2.5 1.1 3.0 2.7 2.2 0.2 ‐18.4



Education 8.8 5.9 10.2 3.8 5.4 5.6 11.1 14.5 5.1 12.0 2.1 4.5 1.1 ‐12.2

Human Health and Social Work Activities 7.9 7.4 5.7 5.4 2.1 ‐1.7 ‐1.9 0.5 3.0 ‐0.6 5.8 9.2 4.7 ‐15.4

Other Services 3.9 ‐0.3 0.5 4.6 5.0 5.0 3.6 4.3 6.7 6.6 5.2 7.3 ‐10.6 ‐63.0

Gross Domestic Product 6.4 7.2 7.5 6.6 6.5 6.4 6.1 6.4 5.7 5.4 6.3 6.7 ‐0.7 ‐16.5

Net Primary Income from the Rest of the World 5.6 7.0 9.0 2.7 2.3 ‐0.9 5.4 1.3 ‐1.6 0.3 ‐4.6 ‐2.8 ‐5.9 ‐22.0

Gross National Income 6.3 7.2 7.7 6.3 6.0 5.7 6.1 5.9 5.0 4.9 5.2 5.8 ‐1.2 ‐17.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Agriculture, Forestry and Fishing 0.6 0.6 0.3 0.3 0.3 . . 0.2 0.1 0.1 0.3 0.1 . 0.1

Industry 1.7 2.2 2.4 2.2 2.2 2.3 1.9 2.5 1.5 0.8 1.6 1.9 ‐1.0 ‐6.9

Mining and Quarrying ‐0.1 0.1 . 0.1 0.1 . . 0.1 . 0.1 . . ‐0.2 ‐0.3

Manufacturing 1.0 1.5 1.9 1.7 1.3 1.3 0.7 0.7 1.1 0.4 0.2 0.8 ‐0.8 ‐3.9

Electricity, Steam, Water and Waste Management 0.1 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.1 0.2 0.3 0.2 0.1 ‐0.2

Construction 0.7 0.4 0.3 0.3 0.6 0.8 1.0 1.5 0.3 . 1.2 0.9 ‐0.2 ‐2.5

Services 4.1 4.4 4.8 4.1 4.0 4.1 4.2 3.7 4.2 4.6 4.5 4.7 0.4 ‐9.7


Motor Vehicles and Motorcycles 1.1 1.0 1.4 1.4 0.8 1.1 1.1 1.2 1.1 1.4 1.6 1.6 0.3 ‐2.3

Transportation and Storage 0.4 0.3 0.1 0.2 0.4 0.3 0.4 0.1 0.3 0.3 0.3 0.2 ‐0.5 ‐2.5

Accommodation and Food Service Activities 0.2 0.2 0.3 0.3 0.3 0.2 0.2 0.2 0.1 0.1 0.1 0.2 ‐0.4 ‐1.4



Real Estate and Ownership of Dwellings 0.3 0.5 0.5 0.3 0.4 0.4 0.4 0.2 0.3 0.3 0.4 0.3 ‐0.2 ‐1.3

Professional and Business Services 0.5 0.7 0.7 0.6 0.3 0.3 0.3 0.2 0.1 0.2 0.2 0.1 . ‐1.2



Education 0.4 0.3 0.4 0.1 0.2 0.2 0.4 0.5 0.2 0.5 0.1 0.2 . ‐0.6

Human Health and Social Work Activities 0.1 0.1 0.1 0.1 . . . . 0.1 . 0.1 0.1 0.1 ‐0.3

Other Services 0.1 . . 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.1 0.2 ‐0.3 ‐1.5


Note: Total may not add up due to rounding.

The PSA released the revised and rebased to 2018 National Accounts of the Philippines (NSP) on 20 April 2020. The salient features of the revision and rebasing are as follows: (1) adoption of the 2008 System of National Accounts (SNA) recommendations and latest classification systems; (2) inclusion of

new industries and expenditure commodities; and (3) updating of the base year to 2018.

. Rounds off to zero

Source of basic data: Philippine Statistics Authority (PSA)

CONTRIBUTION TO GDP GROWTH (in percentage point)

2017 2018 2019 2020

ANNUAL CHANGE (in percent)

2017 2018 2019 2020

LEVELS (in billion pesos; at constant 2018 prices)

2017 2018 2019 2020

1a GROSS NATIONAL INCOME AND GROSS DOMESTIC PRODUCT BY EXPENDITURE SHARESfor periods indicated

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Household Final Consumption Expenditure 2,943.5 3,073.4 2,983.4 3,527.5 3,114.8 3,263.9 3,148.7 3,722.7 3,309.0 3,447.0 3,338.0 3,933.2 3,316.8 2,913.2

Government Final Consumption Expenditure 433.8 583.7 464.8 457.6 494.2 655.5 531.8 518.2 526.0 700.2 578.4 606.3 562.9 854.7

Gross Capital Formation 1,007.1 1,132.6 1,066.6 1,250.0 1,042.6 1,305.2 1,246.2 1,365.0 1,144.6 1,294.8 1,245.0 1,399.3 945.4 602.0

Gross Fixed Capital Formation 948.5 1,133.8 1,086.8 1,242.9 1,040.5 1,335.0 1,244.8 1,363.0 1,121.3 1,296.3 1,317.8 1,441.7 1,072.4 806.8

Construction 516.6 704.8 627.4 709.4 591.6 816.1 710.2 821.9 648.2 826.8 811.5 915.7 620.0 554.7

Durable Equipment 326.5 321.6 346.8 393.2 333.3 398.6 407.7 387.4 351.8 338.5 368.2 362.3 331.0 128.2

Breeding Stocks & Orchard Development 82.8 87.3 84.4 113.8 90.4 94.9 92.1 120.3 92.3 97.7 91.7 122.0 91.2 99.9

Intellectual Property Products 22.7 20.1 28.1 26.6 25.2 25.5 34.8 33.3 29.0 33.2 46.4 41.8 30.3 24.0

Changes in Inventories 58.6 ‐1.2 ‐20.3 5.7 1.1 ‐30.4 1.3 1.1 23.0 ‐2.0 ‐73.2 ‐42.7 ‐127.2 ‐204.9

Valuables 0.0 0.0 0.1 1.4 1.1 0.6 0.1 0.9 0.2 0.5 0.4 0.3 0.2 0.2

Exports of Goods and Services 1,181.4 1,307.5 1,304.9 1,141.7 1,334.8 1,454.3 1,435.1 1,294.4 1,390.4 1,499.5 1,461.6 1,298.7 1,328.6 944.1

Less: Imports of Goods and Services 1,592.6 1,685.0 1,638.3 1,767.5 1,750.4 1,997.9 1,933.5 1,980.5 1,905.6 1,999.2 1,931.3 1,967.3 1,740.6 1,198.7

Statistical Discrepancy ‐13.2 25.2 ‐38.8 26.8 ‐20.5 39.4 ‐31.1 12.2 ‐6.7 32.4 ‐15.8 ‐10.0 12.9 39.5

Gross Domestic Product 3,960.0 4,437.3 4,142.6 4,636.0 4,215.6 4,720.4 4,397.2 4,932.0 4,457.6 4,974.7 4,675.9 5,260.2 4,426.0 4,154.8

Net Primary Income from the Rest of the World 488.0 468.2 472.4 479.5 499.4 463.9 497.9 485.9 491.3 465.4 475.2 472.2 462.4 362.9

Gross National Income 4,448.0 4,905.6 4,615.1 5,115.6 4,715.0 5,184.3 4,895.2 5,417.9 4,949.0 5,440.1 5,151.1 5,732.4 4,888.5 4,517.8

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Household Final Consumption Expenditure 6.0 6.0 5.5 6.3 5.8 6.2 5.5 5.5 6.2 5.6 6.0 5.7 0.2 ‐15.5

Government Final Consumption Expenditure ‐2.1 7.1 7.9 13.8 13.9 12.3 14.4 13.2 6.4 6.8 8.8 17.0 7.0 22.1

Gross Capital Formation 16.9 9.5 10.2 8.3 3.5 15.2 16.8 9.2 9.8 ‐0.8 ‐0.1 2.5 ‐17.4 ‐53.5

Gross Fixed Capital Formation 11.8 8.9 10.0 11.7 9.7 17.7 14.5 9.7 7.8 ‐2.9 5.9 5.8 ‐4.4 ‐37.8

Construction 8.5 7.5 8.2 10.7 14.5 15.8 13.2 15.8 9.6 1.3 14.3 11.4 ‐4.4 ‐32.9

Durable Equipment 17.7 9.8 12.9 14.7 2.1 23.9 17.5 ‐1.5 5.5 ‐15.1 ‐9.7 ‐6.5 ‐5.9 ‐62.1

Breeding Stocks & Orchard Development 6.3 8.6 6.9 5.9 9.2 8.8 9.1 5.8 2.1 3.0 ‐0.5 1.4 ‐1.1 2.2

Intellectual Property Products 30.4 63.5 26.9 24.6 11.2 26.5 23.7 25.5 15.2 30.4 33.5 25.4 4.2 ‐27.7

Changes in Inventories

Valuables ‐71.0 ‐95.7 ‐83.7 1,467.6 2,637.9 2,823.6 125.3 ‐32.8 ‐76.9 ‐14.1 182.9 ‐68.9 ‐24.8 ‐56.9

Exports of Goods and Services 12.3 15.9 23.0 18.5 13.0 11.2 10.0 13.4 4.2 3.1 1.8 0.3 ‐4.4 ‐37.0

Less: Imports of Goods and Services 13.9 13.0 16.0 17.7 9.9 18.6 18.0 12.0 8.9 0.1 ‐0.1 ‐0.7 ‐8.7 ‐40.0


Net Primary Income from the Rest of the World 5.6 7.0 9.0 2.7 2.3 ‐0.9 5.4 1.3 ‐1.6 0.3 ‐4.6 ‐2.8 ‐5.9 ‐22.0

Gross National Income 6.3 7.2 7.7 6.3 6.0 5.7 6.1 5.9 5.0 4.9 5.2 5.8 ‐1.2 ‐17.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Household Final Consumption Expenditure 4.4 4.2 4.0 4.8 4.3 4.3 4.0 4.2 4.6 3.9 4.3 4.3 0.2 ‐10.7

Government Final Consumption Expenditure ‐0.3 0.9 0.9 1.3 1.5 1.6 1.6 1.3 0.8 0.9 1.1 1.8 0.8 3.1

Gross Capital Formation 3.9 2.4 2.6 2.2 0.9 3.9 4.3 2.5 2.4 ‐0.2 . 0.7 ‐4.5 ‐13.9

Gross Fixed Capital Formation 2.7 2.2 2.6 3.0 2.3 4.5 3.8 2.6 1.9 ‐0.8 1.7 1.6 ‐1.1 ‐9.8

Construction 1.1 1.2 1.2 1.6 1.9 2.5 2.0 2.4 1.3 0.2 2.3 1.9 ‐0.6 ‐5.5

Durable Equipment 1.3 0.7 1.0 1.2 0.2 1.7 1.5 ‐0.1 0.4 ‐1.3 ‐0.9 ‐0.5 ‐0.5 ‐4.2

Breeding Stocks & Orchard Development 0.1 0.2 0.1 0.1 0.2 0.2 0.2 0.1 . 0.1 . . . .

Intellectual Property Products 0.1 0.2 0.2 0.1 0.1 0.1 0.2 0.1 0.1 0.2 0.3 0.2 . ‐0.2

Changes in Inventories 1.2 0.1 . ‐0.8 ‐1.5 ‐0.7 0.5 ‐0.1 0.5 0.6 ‐1.7 ‐0.9 ‐3.4 ‐4.1

Valuables . . . . 0.0 . . . . . . . . .

Exports of Goods and Services 3.5 4.3 6.3 4.1 3.9 3.3 3.1 3.3 1.3 1.0 0.6 0.1 ‐1.4 ‐11.2

Less: Imports of Goods and Services 5.2 4.7 5.9 6.1 4.0 7.0 7.1 4.6 3.7 0.0 ‐0.1 ‐0.3 ‐3.7 ‐16.1


Note: Total may not add up due to rounding.

The PSA released the revised and rebased to 2018 National Accounts of the Philippines (NSP) on 20 April 2020. The salient features of the revision and rebasing are as follows: (1) adoption of the 2008 System of National Accounts (SNA) recommendations and latest classification systems; (2) inclusion of

new industries and expenditure commodities; and (3) updating of the base year to 2018.

* means more than 1000 percent


2018

CONTRIBUTION TO GDP GROWTH (in percentage point)

2020

2019 2020

2017 2018 2019 2020

ANNUAL CHANGE (in percent)

2017

LEVELS (in billion pesos; at constant 2018 prices)

2017 2018 2019

2 SELECTED LABOR, EMPLOYMENT AND WAGE INDICATORS

Employment Status 1

Labor Force (in thousands) 42,109 42,714 42,544 43,732 44,075 43,257 42,979 43,528 43,313 44,022 45,385 45,194 45,043 41,018

Employed 39,347 40,271 40,171 41,547 41,755 40,896 40,650 41,325 41,030 41,755 42,953 43,144 42,653 33,764

Employment Created ‐1,342 ‐393 ‐783 ‐138 2,408 625 479 ‐221 ‐726 858 2,303 1,819 1,624 ‐7,991

Agriculture ‐881 125 ‐1,027 ‐1,428 841 ‐723 ‐750 ‐419 ‐2,023 ‐732 716 168 817 ‐316

Industry ‐1 41 434 368 716 606 176 406 616 43 153 236 ‐163 ‐2,337

Services ‐460 ‐559 ‐189 922 850 742 1,052 ‐208 681 1,548 1,435 1,415 969 ‐5,338

Unemployed 2,761 2,443 2,373 2,185 2,320 2,361 2,329 2,203 2,283 2,267 2,432 2,050 2,390 7,254

Underemployed 6,398 6,468 6,541 6,616 7,498 6,935 7,003 5,502 6,326 5,607 5,955 5,616 6,317 6,388

Labor Force Participation Rate (%) 60.7 61.4 60.6 62.1 62.2 60.9 60.1 60.6 60.3 61.3 62.1 61.5 61.7 55.6

Employment Rate (%) 93.4 94.3 94.4 95.0 94.7 94.5 94.6 94.9 94.7 94.9 94.6 95.5 94.7 82.3

Unemployment Rate (%) 6.6 5.7 5.6 5.0 5.3 5.5 5.4 5.1 5.3 5.1 5.4 4.5 5.3 17.7

Underemployment Rate (%) 16.3 16.1 16.3 15.9 18.0 17.0 17.2 13.3 15.4 13.4 13.9 13.0 14.8 18.9

NCR Labor Turnover Rate (%) 1.3 2.1 1.1 1.4 0.5 0.7

Philippine Labor Turnover Rate 2 (%) 1.6 1.7 0.8 0.8

Overseas Employment (Deployed, in thousands) 609 611 472 301

Land‐based 488 493 388 245

Sea‐based 121 118 84 56

Strikes

Number of New Strikes 2 4 3 0 2 2 7 3 6 3 4 5 4 0 a

Number of Workers Involved 352 693 434 0 510 1,533 1,131 4,928 835 498 1,108 1,104 2,554 0 a

Nominal Daily Wage Rates 3 (in pesos)

Non‐Agricultural

NCR 491.0 491.0 491.0 512.0 512.0 512.0 512.0 537.0 537.0 537.0 537.0 537.0 537.0 537.0

Regions Outside NCR 378.5 380.0 380.0 380.0 380.0 400.0 400.0 400.0 400.0 400.0 400.0 400.0 420.0 420.0

Agricultural

NCR

Plantation 454.0 454.0 454.0 475.0 475.0 475.0 475.0 500.0 500.0 500.0 500.0 500.0 500.0 500.0

Non‐Plantation 454.0 454.0 454.0 475.0 475.0 475.0 475.0 500.0 500.0 500.0 500.0 500.0 500.0 500.0

Regions Outside NCR

Plantation 353.5 353.5 353.5 353.5 353.5 370.0 370.0 370.0 391.0 391.0 391.0 391.0 394.0 394.0

Non‐Plantation 348.0 348.0 348.0 348.0 348.0 356.0 368.0 368.0 391.0 391.0 391.0 391.0 394.0 394.0

Real Daily Wage Rates 4 (in pesos), 2006=100

Non‐Agricultural

NCR 357.9 358.1 349.7 360.3 449.9 447.2 437.6 460.9 457.4 455.5 455.1 448.3 449.8 446.8

Regions Outside NCR 262.1 254.4 253.2 251.2 333.6 348.7 341.9 342.5 340.7 340.1 337.3 332.2 346.5 345.7

Agricultural

NCR

Plantation 330.9 331.2 323.4 334.3 417.4 414.9 406.0 429.2 425.9 424.1 423.7 417.4 418.8 416.0

Non‐Plantation 330.9 331.2 323.4 334.3 417.4 414.9 406.0 429.2 425.9 424.1 423.7 417.4 418.8 416.0

Regions Outside NCR

Plantation 244.8 245.5 243.3 240.6 310.9 322.6 316.2 316.8 325.3 322.9 321.6 319.7 312.5 310.7

Non‐Plantation 230.0 228.2 227.0 224.7 290.0 310.4 297.3 300.4 325.3 322.9 321.6 319.7 312.5 310.7

Note: Details may not add up due to rounding.1 Starting April 2016 round, the Labor Force Survey (LFS) adopted the 2013 Master Sample Design, with a sample size of approximately 44,000 households as well as the population projections based on the

2010 Census of Population and Housing (CPH). Meanwhile, previous survey rounds were derived using 2000 CPH population projections. Starting January 2017 round, Computer Aided Personal Interviewing (CAPI)

using Tablet was utilized in the LFS enumeration. 2 Starting Q1 2018, the Labor Turnover Survey covered establishments based within and outside the NCR. Meanwhile, previous survey rounds covered NCR enterprises only.3 Data on nominal and real wage rates are sourced from the the National Wages and Productivity Commission, including basic minimum wage and cost of living allowance (COLA). Starting 2006, annual figures reflect

December data. Figures outside the NCR represent the highest nominal regional rates in a given category and its corresponding value in real terms.4 Starting 10 November 1990, adjustments in the minimum legislated wage rates are being determined by the Regional Tripartite Wages Productivity Board. Starting 2018, real terms is computed using 2012 as base year,

while previous data were computed using 2006 as base year.p Preliminarya As of May 2020

Sources of data: Philippine Overseas Employment Administration (POEA), National Wages and Productivity Commission (NWPC), National Conciliation and Mediation Board (NCMB),

Department of Labor and Employment (DOLE) ‐ Bureau of Local Employment (BLE) and Philippine Statistics Authority (PSA).

Q2Q1 Q2 Q3 Q4Q4 Q1Q1 Q2 Q3 Q4Q1 Q2 Q3

2017 2018 2019 2020

3 CASH OPERATIONS OF THE NATIONAL GOVERNMENTfor periods indicated; in billion pesos

Revenues 532.4 644.0 625.1 671.7 619.8 790.7 701.0 738.7 687.7 859.8 780.4 809.6 763.1 r 690.2

Ratio to GDP (in pecent) 1 14.2 15.5 15.6 14.5 15.1 17.3 15.8 14.4 15.5 17.7 16.5 14.7 17.2 r 16.6

Tax 480.0 589.0 570.0 611.8 558.7 696.1 640.6 670.6 616.0 765.0 709.5 737.3 620.8 595.5

Non‐tax 52.4 55.0 55.1 59.9 61.1 94.7 60.4 68.1 71.7 94.8 70.9 72.2 142.2 r 94.7

Expenditures 615.4 715.5 683.7 809.2 772.0 831.6 886.2 918.7 778.0 812.2 1,036.7 1,170.8 849.2 1,164.5

Ratio to GDP (in pecent) 1 16.4 17.2 17.0 17.4 18.8 18.2 19.9 17.9 17.6 16.7 21.9 21.3 19.1 28.1

Interest Payments 97.9 53.7 97.4 61.6 97.2 68.3 105.8 77.9 107.8 72.3 113.7 67.1 119.9 67.8

Equity 0.0 3.2 . 2.1 2.0 0.6 1.3 0.1 . 0.5 1.1 1.6 0.0 0.6

Net Lending ‐1.7 0.4 ‐4.1 1.2 ‐0.2 1.6 5.5 ‐2.0 3.5 15.3 ‐2.9 1.2 ‐8.9 ‐21.1

Subsidy 19.7 38.6 25.4 47.5 45.3 22.5 57.1 11.8 9.3 17.4 130.4 44.5 36.2 133.4

Allotment to LGUs 122.4 151.3 128.3 128.2 148.7 153.9 140.2 132.8 149.5 146.2 162.6 159.6 187.6 221.6

Tax Expenditures 2 0.2 1.4 0.7 1.2 1.6 2.5 2.7 5.8 0.4 3.3 8.1 3.7 0.7 1.1

Others ‐ NG Disbursements 377.0 466.9 436.1 567.5 477.4 582.2 573.7 692.2 507.5 557.1 623.7 893.1 513.7 761.1

Surplus/Deficit (‐) ‐83.0 ‐71.5 ‐58.6 ‐137.6 ‐152.2 ‐40.8 ‐185.2 ‐180.0 ‐90.2 47.6 ‐256.3 ‐361.2 ‐86.2 r ‐474.3

Ratio to GDP (in pecent) 1 ‐2.2 ‐1.7 ‐1.5 ‐3.0 ‐3.7 ‐0.9 ‐4.2 ‐3.5 ‐2.0 1.0 ‐5.4 ‐6.6 ‐1.9 r ‐11.4

Primary Balance 3 14.9 ‐17.8 38.8 ‐76.0 ‐55.0 27.5 ‐79.4 ‐102.1 17.5 119.9 ‐142.7 ‐294.1 33.7 r ‐406.5

Ratio to GDP (in pecent) 1 0.4 ‐0.4 1.0 ‐1.6 ‐1.3 0.6 ‐1.8 ‐2.0 0.4 2.5 ‐3.0 ‐5.3 0.8 r ‐9.8

Financing 4 117.4 276.4 106.0 259.1 144.1 235.8 209.7 193.6 582.0 150.1 65.5 78.6 800.6 r 747.4

External Borrowings 29.8 ‐1.6 9.3 ‐9.9 82.8 ‐7.0 116.3 ‐0.3 91.8 25.7 55.0 12.4 51.3 248.7

Domestic Borrowings 87.7 278.0 96.6 269.0 61.3 242.9 93.4 193.9 490.3 124.4 10.5 66.2 749.3 r 498.7

Total Change in Cash: Deposit/Withdrawal (‐) 50.5 126.3 ‐24.0 102.7 ‐61.9 36.4 ‐26.6 ‐0.6 355.0 156.5 ‐269.6 ‐466.5 655.0 45.1

Note: Details may not add up due to rounding.

. rounds off to zeror revised1 Updated to reflect the revised GDP, based on the revised and rebased national accounts released by the PSA.2 Excludes documentary stamps3 Primary balance is the government fiscal balance excluding interest payments.4 Based on the revised data on financing, which are sourced from the National Government Cash Operations of the Bureau of the Treasury (BTr) to conform with the Government Finance Statistics Manual (GFSM) 2014 concept where reporting of debt amortization

reflects the actual principal repayments to creditor including those serviced by the Bond Sinking Fund (BSF), while financing includes gross proceeds of liability management transactions such as bond exchange.

Source of Data: Bureau of the Treasury (BTr)

Q2Q1 Q2 Q3 Q1Q2 Q3 Q4 Q1

2017

Q1 Q2 Q3 Q4 Q4

2018 2019 2020

5

4 CONSUMER PRICE INDEX IN THE PHILIPPINES (2012=100)

for periods indicated; quarterly averages

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 110.6 111.0 111.5 112.7 114.8 116.3 118.4 119.4 119.2 119.8 120.4 121.3 122.4 122.5

Food and Non‐Alcoholic Beverages 114.7 114.9 115.7 117.4 120.4 121.7 125.5 126.8 125.9 125.4 126.1 127.2 128.8 129.2

Food 115.3 115.6 116.4 118.2 121.1 122.0 125.9 127.3 126.1 125.6 126.2 127.3 129.0 129.4

Alcoholic Beverages and Tobacco 153.6 155.8 157.5 159.5 178.0 187.7 191.6 194.1 201.1 205.6 212.8 228.1 238.2 242.9

Non‐Food 106.8 107.4 107.6 108.5 109.6 111.0 112.0 112.7 112.9 113.9 114.3 114.7 115.3 115.0

Clothing and Footwear 113.8 114.3 114.8 115.2 116.1 116.8 117.6 118.2 118.9 119.6 120.7 121.4 122.1 122.6

Housing, Water, Electricity, Gas and Other Fuels 105.7 106.4 106.0 107.5 108.6 110.1 111.5 112.1 112.6 113.6 113.3 113.5 114.7 113.9

Electricity, Gas and Other Fuels 95.5 96.9 94.9 98.4 99.6 102.9 105.0 105.1 104.5 106.0 102.6 102.5 103.7 100.7

Furnishings, Household Equipment and

Routine Maintenance of the House 111.9 112.4 113.0 113.5 114.6 115.7 116.9 117.8 118.8 119.4 120.3 121.2 123.1 124.3

Health 111.8 112.2 112.6 112.9 114.3 115.2 117.1 118.0 119.0 119.4 120.7 121.5 122.4 122.8

Transport 97.4 98.2 98.5 100.0 102.2 104.1 106.3 107.2 104.6 107.2 106.1 106.5 105.6 103.8

Operation of Personal Transport Equipment 82.2 80.7 82.2 87.0 92.9 98.5 101.6 99.6 94.4 100.6 97.6 97.8 94.9 81.5

Communication 100.7 100.7 100.8 100.9 100.9 101.0 101.2 101.3 101.3 101.4 101.5 101.6 101.7 101.7

Recreation and Culture 109.7 110.0 111.0 110.9 111.2 111.5 113.3 114.4 114.7 115.0 115.7 116.0 116.4 116.6

Education 117.9 118.5 120.0 120.0 120.0 121.5 115.4 115.5 115.4 116.6 120.5 120.8 120.8 120.8

Restaurants and Miscellaneous Goods and Services 108.6 108.9 109.6 110.1 111.4 112.8 113.9 114.9 115.8 116.5 117.5 118.1 118.8 119.3

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 1.1 0.4 0.5 1.1 1.9 1.3 1.8 0.8 ‐0.2 0.5 0.5 0.7 0.9 0.1

Food and Non‐Alcoholic Beverages 0.9 0.2 0.7 1.5 2.6 1.1 3.1 1.0 ‐0.7 ‐0.4 0.6 0.9 1.3 0.3

Food 0.9 0.3 0.7 1.5 2.5 0.7 3.2 1.1 ‐0.9 ‐0.4 0.5 0.9 1.3 0.3


Non‐Food 1.1 0.6 0.2 0.8 1.0 1.3 0.9 0.6 0.2 0.9 0.4 0.3 0.5 ‐0.3


Housing, Water, Electricity, Gas and Other Fuels 1.4 0.7 ‐0.4 1.4 1.0 1.4 1.3 0.5 0.4 0.9 ‐0.3 0.2 1.1 ‐0.7

Electricity, Gas and Other Fuels 4.0 1.5 ‐2.1 3.7 1.2 3.3 2.0 0.1 ‐0.6 1.4 ‐3.2 ‐0.1 1.2 ‐2.9



Health 0.9 0.4 0.4 0.3 1.2 0.8 1.6 0.8 0.8 0.3 1.1 0.7 0.7 0.3

Transport 2.4 0.8 0.3 1.5 2.2 1.9 2.1 0.8 ‐2.4 2.5 ‐1.0 0.4 ‐0.8 ‐1.7

Operation of Personal Transport Equipment 5.9 ‐1.8 1.9 5.8 6.8 6.0 3.1 ‐2.0 ‐5.2 6.6 ‐3.0 0.2 ‐3.0 ‐14.1

Communication 0.1 0.0 0.1 0.1 0.0 0.1 0.2 0.1 0.0 0.1 0.1 0.1 0.1 0.0

Recreation and Culture 0.2 0.3 0.9 ‐0.1 0.3 0.3 1.6 1.0 0.3 0.3 0.6 0.3 0.3 0.2

Education 0.1 0.5 1.3 0.0 0.0 1.3 ‐5.0 0.1 ‐0.1 1.0 3.3 0.2 0.0 0.0


Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 2.9 2.8 2.7 3.0 3.8 4.8 6.2 5.9 3.8 3.0 1.7 1.6 2.7 2.3


Food 3.0 3.3 3.2 3.4 5.0 5.5 8.2 7.7 4.1 3.0 0.2 0.0 2.3 3.0


Non‐Food 2.8 2.6 2.3 2.7 2.6 3.4 4.1 3.9 3.0 2.6 2.1 1.8 2.1 1.0



Electricity, Gas and Other Fuels 5.2 5.9 3.6 7.2 4.3 6.2 10.6 6.8 4.9 3.0 ‐2.3 ‐2.5 ‐0.8 ‐5.0



Health 3.2 2.9 2.5 1.9 2.2 2.7 4.0 4.5 4.1 3.6 3.1 3.0 2.9 2.8

Transport 5.1 4.6 5.2 5.2 4.9 6.0 7.9 7.2 2.3 3.0 ‐0.2 ‐0.7 1.0 ‐3.2

Operation of Personal Transport Equipment 16.1 6.7 9.5 12.1 13.0 22.1 23.6 14.5 1.6 2.1 ‐3.9 ‐1.8 0.5 ‐19.0

Communication 0.4 0.3 0.3 0.3 0.2 0.3 0.4 0.4 0.4 0.4 0.3 0.3 0.4 0.3


Education 3.1 2.8 2.1 1.9 1.8 2.5 ‐3.8 ‐3.8 ‐3.8 ‐4.0 4.4 4.6 4.7 3.6



Year‐on‐Year Change (in percent)

2020 2017 2018 2019

2019

2017 2018 2019

2017 2018 2020

Quarter‐on‐Quarter Change (in percent)

2020

4a CONSUMER PRICE INDEX IN THE NATIONAL CAPITAL REGION (2012=100)


Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 107.6 108.5 109.0 110.8 112.8 114.2 116.2 116.9 117.1 117.8 118.0 119.0 119.6 119.6


Food 118.8 120.1 121.0 123.7 126.8 126.5 130.6 130.9 131.0 131.0 132.1 134.8 135.6 134.9


Non‐Food 103.0 103.6 104.1 105.6 106.8 108.4 109.6 110.4 110.7 111.6 111.3 111.6 112.0 112.2






Health 112.2 113.2 114.5 114.5 115.3 115.9 119.7 120.1 121.1 121.2 122.2 122.4 123.8 123.8

Transport 95.0 96.0 97.7 99.5 101.3 102.7 107.3 109.1 106.5 107.9 106.4 106.7 106.2 108.0


Communication 100.6 100.7 100.8 100.8 100.9 101.1 101.3 101.4 101.4 101.4 101.6 101.6 101.6 101.7


Education 119.2 119.8 121.1 121.1 121.1 123.3 123.0 123.0 122.8 124.8 129.3 129.7 129.8 129.8


Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 1.3 0.8 0.5 1.7 1.8 1.2 1.8 0.6 0.2 0.6 0.2 0.8 0.5 0.0

Food and Non‐Alcoholic Beverages 1.1 1.0 0.8 2.1 2.5 0.4 3.1 0.4 0.1 0.1 0.8 1.8 0.6 ‐0.4

Food 1.2 1.1 0.7 2.2 2.5 ‐0.2 3.2 0.2 0.1 0.0 0.8 2.0 0.6 ‐0.5


Non‐Food 1.4 0.6 0.5 1.4 1.1 1.5 1.1 0.7 0.3 0.8 ‐0.3 0.3 0.4 0.2


Housing, Water, Electricity, Gas and Other Fuels 1.7 0.7 ‐0.5 2.6 1.5 1.8 0.7 0.4 0.8 0.8 ‐1.3 0.1 0.2 ‐0.5

Electricity, Gas and Other Fuels 8.2 2.3 ‐5.0 8.4 1.3 5.3 1.6 ‐0.4 0.3 1.2 ‐6.7 0.2 ‐1.5 ‐4.0



Health 1.0 0.9 1.1 0.0 0.7 0.5 3.3 0.3 0.8 0.1 0.8 0.2 1.1 0.0

Transport 4.1 1.1 1.8 1.8 1.8 1.4 4.5 1.7 ‐2.4 1.3 ‐1.4 0.3 ‐0.5 1.7


Communication 0.1 0.1 0.1 0.0 0.1 0.2 0.2 0.1 0.0 0.0 0.2 0.0 0.0 0.1


Education 0.0 0.5 1.1 0.0 0.0 1.8 ‐0.2 0.0 ‐0.2 1.6 3.6 0.3 0.1 0.0


Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 3.3 3.7 3.5 4.3 4.8 5.3 6.6 5.5 3.8 3.2 1.5 1.8 2.1 1.5


Food 6.0 6.7 5.8 5.4 6.7 5.3 7.9 5.8 3.3 3.6 1.1 3.0 3.5 3.0


Non‐Food 2.3 2.5 2.7 3.9 3.7 4.6 5.3 4.5 3.7 3.0 1.6 1.1 1.2 0.5


Housing, Water, Electricity, Gas and Other Fuels 1.5 2.2 1.7 4.6 4.3 5.5 6.7 4.4 3.8 2.7 0.8 0.5 ‐0.2 ‐1.5

Electricity, Gas and Other Fuels 5.7 9.0 4.2 14.0 6.7 9.8 17.5 7.9 6.9 2.7 ‐5.7 ‐5.1 ‐6.8 ‐11.5



Health 2.0 2.6 3.4 3.1 2.8 2.4 4.5 4.9 5.0 4.6 2.1 1.9 2.2 2.1

Transport 6.5 6.8 8.8 9.0 6.6 7.0 9.8 9.6 5.1 5.1 ‐0.8 ‐2.2 ‐0.3 0.1

Operation of Personal Transport Equipment 19.5 8.9 13.9 16.1 14.5 22.3 20.9 10.4 0.8 1.5 ‐5.9 ‐3.1 ‐0.5 ‐17.1

Communication 0.3 0.2 0.3 0.3 0.3 0.4 0.5 0.6 0.5 0.3 0.3 0.2 0.2 0.3


Education 3.0 2.5 1.6 1.6 1.6 2.9 1.6 1.6 1.4 1.2 5.1 5.4 5.7 4.0



2018 2019

2019

2017 2018 2019

2020


2020


2020

2017 2018

2017

4b CONSUMER PRICE INDEX IN AREAS OUTSIDE THE NATIONAL CAPITAL REGION (2012=100)


Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 111.4 111.8 112.2 113.3 115.4 117.0 119.1 120.2 119.9 120.3 121.1 121.9 123.3 123.3


Food 114.6 114.7 115.4 117.1 120.0 121.2 125.0 126.6 125.2 124.5 125.0 125.9 127.7 128.3


Non‐Food 108.2 108.7 108.8 109.5 110.7 112.0 112.8 113.5 113.7 114.7 115.3 115.8 116.5 116.0






Health 111.7 111.9 112.2 112.5 114.0 115.1 116.5 117.5 118.5 119.0 120.4 121.2 122.1 122.6

Transport 98.1 98.8 98.7 100.1 102.5 104.5 105.9 106.6 104.0 107.0 106.0 106.5 105.5 102.5


Communication 100.7 100.7 100.8 100.9 100.9 101.0 101.2 101.3 101.3 101.4 101.5 101.6 101.7 101.7


Education 117.5 118.1 119.7 119.7 119.7 120.9 112.9 113.0 113.0 113.9 117.6 117.8 117.8 117.8


Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 0.9 0.4 0.4 1.0 1.9 1.4 1.8 0.9 ‐0.2 0.3 0.7 0.7 1.1 0.0

Food and Non‐Alcoholic Beverages 0.8 0.1 0.6 1.3 2.6 1.3 3.1 1.3 ‐1.0 ‐0.5 0.5 0.7 1.4 0.5

Food 0.8 0.1 0.6 1.5 2.5 1.0 3.1 1.3 ‐1.1 ‐0.6 0.4 0.7 1.4 0.5


Non‐Food 1.0 0.5 0.1 0.6 1.1 1.2 0.7 0.6 0.2 0.9 0.5 0.4 0.6 ‐0.4


Housing, Water, Electricity, Gas and Other Fuels 1.4 0.6 ‐0.4 0.9 0.9 1.3 1.4 0.6 0.3 0.9 0.2 0.2 1.3 ‐0.7

Electricity, Gas and Other Fuels 3.1 1.3 ‐1.4 2.4 1.3 2.8 2.1 0.3 ‐0.8 1.7 ‐2.4 ‐0.3 2.0 ‐2.5



Health 0.9 0.2 0.3 0.3 1.3 1.0 1.2 0.9 0.9 0.4 1.2 0.7 0.7 0.4

Transport 1.9 0.7 ‐0.1 1.4 2.4 2.0 1.3 0.7 ‐2.4 2.9 ‐0.9 0.5 ‐0.9 ‐2.8


Communication 0.0 0.0 0.1 0.1 0.0 0.1 0.2 0.1 0.0 0.1 0.1 0.1 0.1 0.0

Recreation and Culture 0.1 0.2 1.1 ‐0.1 0.3 0.3 1.8 1.0 0.3 0.3 0.7 0.3 0.3 0.2

Education 0.2 0.5 1.4 0.0 0.0 1.0 ‐6.6 0.1 0.0 0.8 3.2 0.2 0.0 0.0


Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

All Items 2.8 2.7 2.5 2.6 3.6 4.7 6.1 6.1 3.9 2.8 1.7 1.4 2.8 2.5

Food and Non‐Alcoholic Beverages 2.3 2.5 2.5 2.8 4.6 5.9 8.4 8.4 4.7 2.9 0.3 ‐0.2 2.1 3.1

Food 2.4 2.7 2.6 3.0 4.7 5.7 8.3 8.1 4.3 2.7 0.0 ‐0.6 2.0 3.1


Non‐Food 3.0 2.5 2.2 2.2 2.3 3.0 3.7 3.7 2.7 2.4 2.2 2.0 2.5 1.1



Electricity, Gas and Other Fuels 5.0 5.2 3.5 5.5 3.6 5.1 8.8 6.5 4.3 3.2 ‐1.3 ‐1.8 0.9 ‐3.2



Health 3.4 2.9 2.3 1.6 2.1 2.9 3.8 4.4 3.9 3.4 3.3 3.1 3.0 3.0

Transport 4.7 3.8 4.1 3.9 4.5 5.8 7.3 6.5 1.5 2.4 0.1 ‐0.1 1.4 ‐4.2

Operation of Personal Transport Equipment 14.9 6.1 8.1 10.9 12.7 21.9 24.6 15.9 1.8 2.4 ‐3.4 ‐1.3 0.9 ‐19.6

Communication 0.4 0.3 0.3 0.2 0.2 0.3 0.4 0.4 0.4 0.4 0.3 0.3 0.4 0.3


Education 3.3 2.9 2.3 2.0 1.9 2.4 ‐5.7 ‐5.6 ‐5.6 ‐5.8 4.2 4.2 4.2 3.4



2020


2020


20202018 2019

2017 2018

2017 2018 2019

2019

2017

5 MONETARY INDICATORS 1

as of periods indicated; in billion pesos

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 r Q2 p

A. Liquidity

1. M4 (2 + 7) 11,288.2 11,658.4 12,052.5 12,486.6 12,795.5 12,961.6 13,133.5 13,610.3 13,565.4 13,786.9 14,025.5 14,950.1 15,200.5 15,623.9

2. M3: Broad Money Liabilities (3 + 6) 9,544.7 9,898.2 10,173.6 10,636.1 10,919.1 11,067.5 11,179.4 11,643.0 11,583.6 11,801.6 12,027.9 12,976.3 13,127.5 13,561.6

% to GDP 61.8 62.6 62.9 64.2 64.6 63.9 62.9 63.7 62.3 62.5 62.8 66.5 67.2 72.0

3. M2 (4 + 5) 9,189.7 9,532.3 9,772.7 10,202.3 10,480.8 10,616.5 10,707.1 11,080.2 10,977.1 11,181.0 11,408.1 12,293.2 12,374.5 12,782.6

% to GDP 59.5 60.3 60.4 61.6 62.0 61.3 60.3 60.7 59.1 59.2 59.6 63.0 63.3 67.9

4. M1: Currency Outside Depository Corporations and

Transferable Deposits (Narrow Money) 3,113.4 3,241.1 3,335.5 3,550.8 3,666.2 3,735.1 3,716.0 3,889.0 3,889.5 3,940.1 4,096.8 4,500.3 4,805.4 4,948.8

% to GDP 20.2 20.5 20.6 21.4 21.7 21.6 20.9 21.3 20.9 20.9 21.4 23.1 24.6 26.3

a. Currency Outside Depository Corporations

(Currency in Circulation) 888.1 901.1 926.1 1,047.6 1,056.7 1,050.5 1,065.9 1,231.8 1,189.0 1,181.7 1,180.6 1,395.8 1,419.9 1,542.2

b. Transferable Deposits (Demand Deposits) 2,225.3 2,340.1 2,409.4 2,503.3 2,609.5 2,684.6 2,650.0 2,657.2 2,700.5 2,758.4 2,916.2 3,104.5 3,385.5 3,406.6

5. Other Deposits Included in Broad Money 6,076.3 6,291.2 6,437.2 6,651.5 6,814.6 6,881.4 6,991.2 7,191.1 7,087.6 7,240.9 7,311.3 7,792.9 7,569.1 7,833.8

a. Savings Deposits 4,083.7 4,187.5 4,268.0 4,409.3 4,477.1 4,580.4 4,691.9 4,672.5 4,570.6 4,576.2 4,667.4 4,969.4 4,991.7 5,239.7

b. Time Deposits 1,992.6 2,103.6 2,169.2 2,242.2 2,337.5 2,301.1 2,299.3 2,518.6 2,517.0 2,664.6 2,643.9 2,823.5 2,577.4 2,594.1

6. Securities Other Than Shares Included in

Broad Money (Deposit Substitutes) 355.0 365.8 400.9 433.8 438.3 451.0 472.3 562.8 606.5 620.6 619.8 683.1 753.0 779.0

7. Transferable and Other Deposits in Foreign

Currency (FCDU Deposits ‐ Residents) 1,743.5 1,760.2 1,878.9 1,850.6 1,876.4 1,894.1 1,954.0 1,967.3 1,981.8 1,985.2 1,997.6 1,973.8 2,073.0 2,062.3

8. Liabilities Excluded from Broad Money

(Other Liabilities) 2,494.9 2,380.7 2,484.6 2,393.5 2,619.0 2,781.7 2,866.6 2,885.6 2,941.7 2,958.7 3,220.4 3,226.0 3,145.0 3,460.3

B. Domestic Claims 9,405.0 9,622.8 10,037.1 10,476.9 10,792.7 11,204.0 11,540.1 12,035.0 11,789.0 12,006.7 12,414.8 13,318.2 13,195.9 13,603.1

1. Net Claims on Central Government 1,664.6 1,614.8 1,638.9 1,635.5 1,778.0 1,816.2 1,825.7 1,911.1 1,782.1 1,750.6 1,923.7 2,363.7 2,166.9 2,681.2

Claims on Central Government 2,206.5 2,314.3 2,311.3 2,400.2 2,485.8 2,555.1 2,591.2 2,690.4 2,940.1 3,038.7 2,990.6 2,953.2 3,448.9 4,018.7

Less: Liabilities to Central Government 541.9 699.5 672.4 764.8 707.7 738.9 765.5 779.3 1,158.0 1,288.1 1,066.9 589.5 1,282.1 1,337.5

2. Claims on Other Sectors 7,740.4 8,008.0 8,398.2 8,841.4 9,014.7 9,387.8 9,714.3 10,123.9 10,006.8 10,256.1 10,491.2 10,954.5 11,029.0 10,921.9

Claims on Other Financial Corporations 792.7 780.2 836.0 925.0 879.4 957.1 1,041.5 1,088.3 1,110.8 1,124.9 1,175.1 1,232.4 1,171.7 1,165.5

Claims on State and Local Government 82.5 85.3 80.5 81.1 81.9 81.6 83.7 87.5 91.9 95.3 97.1 99.1 98.6 97.6

Claims on Public Nonfinancial Corporations 257.4 265.0 303.9 284.6 280.7 272.4 248.4 260.7 261.1 242.8 239.5 259.6 255.2 231.4

Claims on Private Sector 6,607.8 6,877.5 7,177.8 7,550.7 7,772.8 8,076.7 8,340.6 8,687.4 8,543.0 8,793.1 8,979.4 9,363.4 9,503.5 9,427.3

C. Net Foreign Assets 4,378.1 4,416.3 4,500.0 4,403.2 4,621.7 4,539.3 4,460.0 4,460.9 4,718.1 4,738.9 4,831.1 4,857.9 5,149.6 5,481.2

1. Bangko Sentral ng Pilipinas 3,992.3 4,031.5 4,042.2 4,003.6 4,130.1 4,064.2 3,977.3 4,088.9 4,326.2 4,280.0 4,364.0 4,399.1 4,475.8 4,663.1

Claims on Non‐Residents 4,071.3 4,111.9 4,124.7 4,084.7 4,216.7 4,149.6 4,064.1 4,172.4 4,410.6 4,361.3 4,445.6 4,479.4 4,555.9 4,741.6

Less: Liabilities to Non‐Residents 79.0 80.4 82.4 81.1 86.6 85.4 86.8 83.5 84.4 81.3 81.6 80.3 80.1 78.4

2. Other Depository Corporations 385.7 384.8 457.8 399.6 491.7 475.1 482.7 372.1 391.9 458.9 467.1 458.8 673.8 818.1

Claims on Non‐Residents 1,229.5 1,245.9 1,304.2 1,296.0 1,367.4 1,374.3 1,448.9 1,501.7 1,512.7 1,583.5 1,693.6 1,654.6 1,677.7 1,667.2

Less: Liabilities to Non‐Residents 843.7 861.2 846.4 896.3 875.7 899.2 966.2 1,129.7 1,120.8 1,124.6 1,226.6 1,195.8 1,003.9 849.1

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

A. Liquidity

1. M4 (2 + 7) 12.5 13.7 15.2 11.3 13.4 11.2 9.0 9.0 6.0 6.4 6.8 9.8 12.1 13.3

2. M3: Broad Money Liabilities (3 + 6) 11.7 13.4 14.8 11.9 14.4 11.8 9.9 9.5 6.1 6.6 7.6 11.5 13.3 14.9

3. M2 (4 + 5) 11.8 13.3 14.6 11.6 14.0 11.4 9.6 8.6 4.7 5.3 6.5 10.9 12.7 14.3

4. M1: Currency Outside Depository Corporations andTransferable Deposits (Narrow Money) 14.8 16.0 16.7 15.7 17.8 15.2 11.4 9.5 6.1 5.5 10.2 15.7 23.5 25.6

a. Currency Outside Depository Corporations(Currency in Circulation) 15.9 16.0 16.4 13.7 19.0 16.6 15.1 17.6 12.5 12.5 10.8 13.3 19.4 30.5

b. Transferable Deposits (Demand Deposits) 14.3 16.0 16.8 16.5 17.3 14.7 10.0 6.1 3.5 2.8 10.0 16.8 25.4 23.5

5. Other Deposits Included in Broad Money 10.3 12.0 13.6 9.6 12.1 9.4 8.6 8.1 4.0 5.2 4.6 8.4 6.8 8.2a. Savings Deposits 10.3 9.5 9.5 7.5 9.6 9.4 9.9 6.0 2.1 ‐0.1 ‐0.5 6.4 9.2 14.5b. Time Deposits 10.5 17.3 22.7 13.8 17.3 9.4 6.0 12.3 7.7 15.8 15.0 12.1 2.4 ‐2.6

6. Securities Other Than Shares Included in Broad Money (Deposit Substitutes) 9.9 16.0 19.7 18.7 23.5 23.3 17.8 29.7 38.4 37.6 31.2 21.4 24.2 25.5

7. Transferable and Other Deposits in ForeignCurrency (FCDU Deposits ‐ Residents) 17.0 15.3 17.5 8.3 7.6 7.6 4.0 6.3 5.6 4.8 2.2 0.3 4.6 3.9

8. Liabilities Excluded from Broad Money(Other Liabilities) 16.3 0.2 ‐6.0 4.3 5.0 16.8 15.4 20.6 12.3 6.4 12.3 11.8 6.9 17.0

B. Domestic Claims 16.5 15.5 16.6 13.9 14.8 16.4 15.0 14.9 9.2 7.2 7.6 10.7 11.9 13.3

1. Net Claims on Central Government 15.0 14.1 10.0 2.0 6.8 12.5 11.4 16.9 0.2 ‐3.6 5.4 23.7 21.6 53.2Claims on Central Government 6.8 13.3 9.6 14.5 12.7 10.4 12.1 12.1 18.3 18.9 15.4 9.8 17.3 32.2Less: Liabilities to Central Government ‐12.6 11.3 8.7 54.8 30.6 5.6 13.8 1.9 63.6 74.3 39.4 ‐24.4 10.7 3.8

2. Claims on Other Sectors 16.8 15.8 18.0 16.4 16.5 17.2 15.7 14.5 11.0 9.2 8.0 8.2 10.2 6.5Claims on Other Financial Corporations 14.9 8.0 15.5 20.0 10.9 22.7 24.6 17.7 26.3 17.5 12.8 13.2 5.5 3.6Claims on State and Local Government 6.0 5.9 ‐1.6 ‐2.1 ‐0.8 ‐4.3 4.0 7.9 12.3 16.7 16.0 13.3 7.3 2.5Claims on Public Nonfinancial Corporations ‐8.8 ‐7.6 9.6 10.8 9.1 2.8 ‐18.3 ‐8.4 ‐7.0 ‐10.9 ‐3.6 ‐0.4 ‐2.3 ‐4.7Claims on Private Sector 18.4 18.0 18.9 16.4 17.6 17.4 16.2 15.1 9.9 8.9 7.7 7.8 11.2 7.2

C. Net Foreign Assets 6.8 2.8 0.1 2.2 5.6 2.8 ‐0.9 1.3 2.1 4.4 8.3 8.9 9.1 15.7

1. Bangko Sentral ng Pilipinas 5.7 1.5 ‐2.3 1.4 3.5 0.8 ‐1.6 2.1 4.7 5.3 9.7 7.6 3.5 9.0Claims on Non‐Residents 5.7 1.6 ‐2.1 1.5 3.6 0.9 ‐1.5 2.1 4.6 5.1 9.4 7.4 3.3 8.7Less: Liabilities to Non‐Residents 6.7 7.0 5.8 5.1 9.6 6.3 5.3 3.0 ‐2.6 ‐4.8 ‐6.1 ‐3.8 ‐5.1 ‐3.5

2. Other Depository Corporations 19.9 17.6 28.1 10.3 27.5 23.5 5.5 ‐6.9 ‐20.3 ‐3.4 ‐3.2 23.3 71.9 78.3Claims on Non‐Residents 14.8 12.4 15.0 7.0 11.2 10.3 11.1 15.9 10.6 15.2 16.9 10.2 10.9 5.3Less: Liabilities to Non‐Residents 12.6 10.2 8.9 5.5 3.8 4.4 14.1 26.0 28.0 25.1 27.0 5.9 ‐10.4 ‐24.5

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

M3: Broad Money Liabilities 11.7 13.4 14.8 11.9 14.4 11.8 9.9 9.5 6.1 6.6 7.6 11.5 13.3 14.9

1. M2 (2 + 3) 11.4 12.8 14.1 11.2 13.5 11.0 9.2 8.3 4.5 5.1 6.3 10.4 12.1 13.6

2. M1: Currency Outside Depository Corporations andTransferable Deposits (Narrow Money) 4.7 5.1 5.4 5.1 5.8 5.0 3.7 3.2 2.0 1.9 3.4 5.3 7.9 8.5

a. Currency Outside Depository Corporations(Currency in Circulation) 1.4 1.4 1.5 1.3 1.8 1.5 1.4 1.7 1.2 1.2 1.0 1.4 2.0 3.1

b. Transferable Deposits (Demand Deposits) 3.3 3.7 3.9 3.7 4.0 3.5 2.4 1.4 0.8 0.7 2.4 3.8 5.9 5.5

3. Other Deposits Included in Broad Money 6.7 7.7 8.7 6.1 7.7 6.0 5.4 5.1 2.5 3.2 2.9 5.2 4.2 5.0

a. Savings Deposits 4.5 4.2 4.2 3.2 4.1 4.0 4.2 2.5 0.9 . ‐0.2 2.5 3.6 5.6

b. Time Deposits 2.2 3.5 4.5 2.9 3.6 2.0 1.3 2.6 1.6 3.3 3.1 2.6 0.5 ‐0.6

4. Securities Other Than Shares Included in Broad Money (Deposit Substitutes) 0.4 0.6 0.7 0.7 0.9 0.9 0.7 1.2 1.5 1.5 1.3 1.0 1.3 1.3

M3: Broad Money Liabilities 11.7 13.4 14.8 11.9 14.4 11.8 9.9 9.5 6.1 6.6 7.6 11.5 13.3 14.9

1. Domestic Claims 15.6 14.8 16.1 13.4 14.5 16.0 14.8 14.6 9.1 7.3 7.8 11.0 12.1 13.5

a. Net Claims on Central Government 2.5 2.3 1.7 0.3 1.2 2.0 1.8 2.6 . ‐0.6 0.9 3.9 3.3 7.9

Claims on Central Government 1.6 3.1 2.3 3.2 2.9 2.4 2.8 2.7 4.2 4.4 3.6 2.3 4.4 8.3

Less: Liabilities to Central Government ‐0.9 0.8 0.6 2.8 1.7 0.4 0.9 0.1 4.1 5.0 2.7 ‐1.6 1.1 0.4

b. Claims on Other Sectors 13.0 12.5 14.5 13.1 13.4 13.9 12.9 12.1 9.1 7.8 6.9 7.1 8.8 5.6

Claims on Other Financial Corporations 1.2 0.7 1.3 1.6 0.9 1.8 2.0 1.5 2.1 1.5 1.2 1.2 0.5 0.3

Claims on State and Local Government 0.1 0.1 . . . . . 0.1 0.1 0.1 0.1 0.1 0.1 .

Claims on Public Nonfinancial Corporatio ‐0.3 ‐0.2 0.3 0.3 0.2 0.1 ‐0.5 ‐0.2 ‐0.2 ‐0.3 ‐0.1 . ‐0.1 ‐0.1

Claims on Private Sector 12.0 12.0 12.9 11.2 12.2 12.1 11.4 10.7 7.1 6.5 5.7 5.8 8.3 5.4

2. Net Foreign Assets 3.3 1.4 0.1 1.0 2.6 1.2 ‐0.4 0.5 0.9 1.8 3.3 3.4 3.7 6.3

a. Bangko Sentral ng Pilipinas 2.5 0.7 ‐1.1 0.6 1.4 0.3 ‐0.6 0.8 1.8 1.9 3.5 2.7 1.3 3.2

Claims on Non‐Residents 2.6 0.8 ‐1.0 0.6 1.5 0.4 ‐0.6 0.8 1.8 1.9 3.4 2.6 1.3 3.2

Less: Liabilities to Non‐Residents 0.1 0.1 0.1 . 0.1 0.1 . . . . . . . .

b. Other Depository Corporations 0.7 0.7 1.1 0.4 1.1 0.9 0.2 ‐0.3 ‐0.9 ‐0.1 ‐0.1 0.7 2.4 3.0

Claims on Non‐Residents 1.9 1.6 1.9 0.9 1.4 1.3 1.4 1.9 1.3 1.9 2.2 1.3 1.4 0.7

Less: Liabilities to Non‐Residents 1.1 0.9 0.8 0.5 0.3 0.4 1.2 2.2 2.2 2.0 2.3 0.6 ‐1.0 ‐2.3

3. Transferable and Other Deposits in ForeignCurrency (FCDU Deposits ‐ Residents) 3.0 2.7 3.2 1.5 1.4 1.4 0.7 1.1 1.0 0.8 0.4 0.1 0.8 0.7

4. Liabilities Excluded from Broad Money(Other Liabilities) 4.1 0.1 ‐1.8 1.0 1.3 4.1 3.8 4.6 3.0 1.6 3.2 2.9 1.8 4.3

Note: Details may not add up due to rounding.1 Based on the Standardized Report Forms (SRFs), a unified framework for reporting monetary and financial statistics to the International Monetary Fund (IMF).r revisedp preliminary. Rounds off to zero

Source: Bangko Sentral ng Pilipinas (BSP)

PERCENTAGE POINT CONTRIBUTION TO YEAR‐ON‐YEAR M3 GROWTH (in percent)

2017 2018 2019 2020

2019 2020

ANNUAL GROWTH RATES (in percent)

2017 2018

2017 2018 2019 2020

6 SELECTED DOMESTIC INTEREST RATESfor periods indicated; in percent per annum

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Bank Interest Rates

Interbank Call Loans 2.5354 2.5851 2.5824 2.9203 3.0794 3.2855 4.0293 4.7553 5.1365 5.0769 4.5025 4.0458 3.6567 3.1745

Savings Deposits 1 0.6890 0.6650 0.6980 0.6880 0.7420 0.7840 0.9190 1.1350 1.3480 1.3090 1.2780 0.9890 ‐ ‐

Time Deposits (All Maturities) 1 1.6880 1.7530 1.7890 1.9720 2.5260 2.6300 3.1940 4.0610 4.7470 4.5340 3.5270 3.1280 ‐ ‐

Lending Rates 1

High 6.5050 6.4571 6.4772 6.5299 6.6208 6.9164 7.0562 7.8424 8.3720 8.5076 7.8361 7.3549 ‐ ‐

Low 4.2013 4.1736 4.0875 4.0874 4.1654 4.3067 4.5897 5.2283 5.6607 5.8173 5.4369 5.0724 ‐ ‐

All Maturities 2 5.5410 5.6220 5.6560 5.6920 5.6410 5.8930 6.1860 6.7580 7.1230 7.2950 7.1590 6.7960 ‐ ‐

Bangko Sentral Rates 3

3.5000 3.5000 3.5000 3.5000 3.5000 3.7930 4.2920 5.1880 5.2500 5.1273 4.8062 4.5000 4.0840 4.0630

3.0000 3.0000 3.0000 3.0000 3.0000 3.1770 3.7840 4.6270 4.7500 4.6139 4.3480 4.0000 3.7863 3.4857

2.5000 2.5000 2.5000 2.5000 2.5000 2.6840 3.2680 4.1440 4.2500 4.1529 3.8555 3.5000 3.3182 2.4811

3.3790 3.4270 3.4770 3.4800 3.1070 3.5170 4.0920 4.8880 5.1420 4.7347 4.5432 4.3119 4.0281 3.6127

7‐day 3.0160 3.1759 3.3057 3.3881 3.0341 3.5258 4.0512 4.8597 5.0663 4.7143 4.4909 4.2503 3.9704 2.2805

14‐day ... ... ... ... 3.1386 3.5774 4.1368 4.9276 5.1445 4.7282 4.5274 4.3027 3.9846 2.2512

28‐day 3.3812 3.4639 3.4935 3.4929 3.1758 3.5560 4.1664 4.9766 5.1613 4.7465 4.5422 4.3236 4.0163 ..

Rate on Government Securities

Treasury Bills, All Maturities 2.3640 2.5000 2.4770 2.4040 2.7720 3.7560 4.2340 5.9730 5.9420 5.4740 3.7610 3.3080 3.5070 2.4740

35‐Day … … … … … … … … … … … … .. 2.1050

91‐Day 2.1790 2.2060 2.1280 2.0340 2.6370 3.4080 3.2830 5.1050 5.5840 5.2040 3.4150 3.1180 3.1610 2.5160

182‐Day 2.3800 2.5370 2.5480 2.4970 2.8130 3.8290 4.1900 6.1060 6.0000 5.5520 3.7230 3.2290 3.4500 2.5230

364‐Day 2.7100 2.9090 2.9360 2.8780 3.0880 4.2620 4.8920 6.3570 6.0980 5.6270 4.0400 3.5280 3.7890 2.6640

Government Securities in the Secondary Market 4

3‐Month 2.9696 2.8139 2.0251 2.4316 3.0723 3.9071 4.3094 5.7760 5.7990 4.4600 3.1020 3.2040 3.2900 1.9030

6‐Month 2.4222 2.4615 2.4988 3.3075 3.2063 3.8453 4.6491 6.5140 5.9400 4.7600 3.3940 3.3730 3.4310 2.0030

1‐Year 2.6708 3.2257 2.8674 3.0320 3.0750 4.4742 5.2760 6.7830 6.0970 4.9690 3.7040 3.4150 3.7720 2.1610

2‐Year 3.2500 3.8718 3.7821 3.9864 4.1613 4.7842 6.1990 6.8850 5.8220 4.9490 4.0410 3.7380 4.4690 2.1690

3‐Year 4.0988 3.8916 3.6651 4.2977 4.6098 5.0223 7.0339 6.9760 5.7480 4.9590 4.1920 3.8300 4.5400 2.2620

4‐Year 4.2500 4.0321 4.5768 4.9211 5.0179 5.6768 7.4464 7.0160 5.6790 4.9750 4.3400 3.9400 4.6030 2.3460

5‐Year 4.2577 4.0336 4.6375 4.7437 5.2403 5.7620 7.0395 7.0370 5.6270 4.9970 4.4810 4.0610 4.5960 2.4390

7‐Year 5.0625 4.9171 4.3206 5.3279 6.7375 6.2482 7.1101 7.0610 5.5990 5.0370 4.6700 4.2790 4.6760 2.6320

10‐Year 5.0554 4.6691 4.6085 5.6986 6.0000 6.4217 7.2348 7.0650 5.6050 5.0720 4.8010 4.4610 4.8720 2.7950

20‐Year 5.0302 5.0844 5.1479 5.7038 7.1625 7.3607 8.2969 7.4910 5.8190 5.1770 5.0220 5.1590 5.0610 3.5430

25‐Year .. .. .. .. .. .. .. 7.5280 6.0950 5.1250 4.9900 5.2180 5.0680 3.5890

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Bank Interest Rates

Interbank Call Loans ‐0.3646 ‐0.2149 ‐0.1176 ‐0.0797 ‐0.7206 ‐1.5145 ‐2.1707 ‐1.1447 1.3365 2.0769 2.8025 2.4458 0.9567 0.8745

Savings Deposits 1 ‐2.2110 ‐2.1350 ‐2.0020 ‐2.3120 ‐3.0580 ‐4.0160 ‐5.2810 ‐4.7650 ‐2.4520 ‐1.6910 ‐0.4220 ‐0.6110 ‐ ‐

Time Deposits (All Maturities) 1 ‐1.2120 ‐1.0470 ‐0.9110 ‐1.0280 ‐1.2740 ‐2.1700 ‐3.0060 ‐1.8390 0.9470 1.5340 1.8270 1.5280 ‐ ‐

Lending Rates 1

High 3.6050 3.6571 3.7772 3.5299 2.8208 2.1164 0.8562 1.9424 4.5720 5.5076 6.1361 5.7549 ‐ ‐

Low 1.3013 1.3736 1.3875 1.0874 0.3654 ‐0.4933 ‐1.6103 ‐0.6717 1.8607 2.8173 3.7369 3.4724 ‐ ‐

All Maturities 2 2.6410 2.8220 2.9560 2.6920 1.8410 1.0930 ‐0.0140 0.8580 3.3230 4.2950 5.4590 5.1960 ‐ ‐

Bangko Sentral Rates 3

0.6000 0.7000 0.8000 0.5000 ‐0.3000 ‐1.0070 ‐1.9080 ‐0.7120 1.4500 2.1273 3.1062 2.9000 1.3840 1.7630

0.1000 0.2000 0.3000 0.0000 ‐0.8000 ‐1.6230 ‐2.4160 ‐1.2730 0.9500 1.6139 2.6480 2.4000 1.0863 1.1857

‐0.4000 ‐0.3000 ‐0.2000 ‐0.5000 ‐1.3000 ‐2.1160 ‐2.9320 ‐1.7560 0.4500 1.1529 2.1555 1.9000 0.6182 0.1811

0.4790 0.6270 0.7770 0.4800 ‐0.6930 ‐1.2830 ‐2.1080 ‐1.0120 1.3420 1.7347 2.8432 2.7119 1.3281 1.3127

7‐day 0.1160 0.3759 0.6057 0.3881 ‐0.7659 ‐1.2742 ‐2.1488 ‐1.0403 1.2663 1.7143 2.7909 2.6503 1.2704 ‐0.0195

14‐day ... ... ... ... ‐0.6614 ‐1.2226 ‐2.0632 ‐0.9724 1.3445 1.7282 2.8274 2.7027 1.2846 ‐0.0488

28‐day 0.4812 0.6639 0.7935 0.4929 ‐0.6242 ‐1.2440 ‐2.0336 ‐0.9234 1.3613 1.7465 2.8422 2.7236 1.3163 ..

Rates on Government Securities

Treasury Bills, All Maturities ‐0.5360 ‐0.3000 ‐0.2230 ‐0.5960 ‐1.0280 ‐1.0440 ‐1.9660 0.0730 2.1420 2.4740 2.0610 1.7080 0.8070 0.1740

35‐Day ... ... ... ... ... ... ... ... ... ... ... ... .. ‐0.1950

91‐Day ‐0.7210 ‐0.5940 ‐0.5720 ‐0.9660 ‐1.1630 ‐1.3920 ‐2.9170 ‐0.7950 1.7840 2.2040 1.7150 1.5180 0.4610 0.2160

182‐Day ‐0.5200 ‐0.2630 ‐0.1520 ‐0.5030 ‐0.9870 ‐0.9710 ‐2.0100 0.2060 2.2000 2.5520 2.0230 1.6290 0.7500 0.2230

364‐Day ‐0.1900 0.1090 0.2360 ‐0.1220 ‐0.7120 ‐0.5380 ‐1.3080 0.4570 2.2980 2.6270 2.3400 1.9280 1.0890 0.3640

Government Securities in the Secondary Market 4

3‐Month ‐0.1304 0.3139 ‐0.9749 ‐0.4684 ‐1.2277 ‐1.2929 ‐2.3906 0.6760 2.4990 1.7600 2.2020 0.7040 0.7900 ‐0.5970

6‐Month ‐0.6778 ‐0.0385 ‐0.5012 0.4075 ‐1.0937 ‐1.3547 ‐2.0509 1.4140 2.6400 2.0600 2.4940 0.8730 0.9310 ‐0.4970

1‐Year ‐0.4292 0.7257 ‐0.1326 0.1320 ‐1.2250 ‐0.7258 ‐1.4240 1.6830 2.7970 2.2690 2.8040 0.9150 1.2720 ‐0.3390

2‐Year 0.1500 1.3718 0.7821 1.0864 ‐0.1387 ‐0.4158 ‐0.5010 1.7850 2.5220 2.2490 3.1410 1.2380 1.9690 ‐0.3310

3‐Year 0.9988 1.3916 0.6651 1.3977 0.3098 ‐0.1777 0.3339 1.8760 2.4480 2.2590 3.2920 1.3300 2.0400 ‐0.2380

4‐Year 1.1500 1.5321 1.5768 2.0211 0.7179 0.4768 0.7464 1.9160 2.3790 2.2750 3.4400 1.4400 2.1030 ‐0.1540

5‐Year 1.1577 1.5336 1.6375 1.8437 0.9403 0.5620 0.3395 1.9370 2.3270 2.2970 3.5810 1.5610 2.0960 ‐0.0610

7‐Year 1.9625 2.4171 1.3206 2.4279 2.4375 1.0482 0.4101 1.9610 2.2990 2.3370 3.7700 1.7790 2.1760 0.1320

10‐Year 1.9554 2.1691 1.6085 2.7986 1.7000 1.2217 0.5348 1.9650 2.3050 2.3720 3.9010 1.9610 2.3720 0.2950

20‐Year 1.9302 2.5844 2.1479 2.8038 2.8625 2.1607 1.5969 2.3910 2.5190 2.4770 4.1220 2.6590 2.5610 1.0430

25‐Year .. .. .. .. .. .. .. 2.4280 2.7950 2.4250 4.0900 2.7180 2.5680 1.0890

1 Starting 1 January 2020, universal and commercial banks are required to submit the amended reporting templates on banks' lending and deposit rates or "Interest Rates on Loans and Deposits (IRLD) in accordance with

Circular Nos. 1029 and 1037, series of 2019.2 Refers to the interest rate based on reporting universal and commercial banks' interest incomes on their outstanding peso‐denominated loans.3 Beginning 3 June 2016, the BSP shifted its monetary operations to an interest rate corridor (IRC) system. The Repurchase (RP) and Special Deposit Account (SDA) windows were replaced by the standing OLF and ODF, respectively.

The Reverse Repurchase (RRP) Facility was modified to a purely overnight RRP. In addition, the TDF will serve as the main tool for absorbing liquidity. The OLF and ODF will serve as the upper bound and lower bound, respectively,

of the IRC system. The weighted average interest rates (WAIR) of BSP rates are based on outstanding balance as of month‐end. 4 End‐of‐period; beginning 29 October 2018, data refer to the Philippine Peso Bloomberg Valuation Service (PHP BVAL) Reference Rates, while those for earlier periods refer to the Philippine Dealing System

Treasury Reference Rates 2 (PDST‐R2).5 Nominal interest rate less inflation rate with base year 2012

‐ Not Available

.. No Transaction/No Quotation/No Issue

… Blank

Source: Bangko Sentral ng Pilipinas

Term Deposit Facility (TDF)

2017

Term Deposit Facility (TDF)

Overnight Lending Facility (OLF)

Overnight RRP Facility

Overnight Deposit Facility (ODF)

2018 2019 2020

Overnight Lending Facility (OLF)

Overnight RRP Facility

Overnight Deposit Facility (ODF)

NOMINAL INTEREST RATES

REAL INTEREST RATES 5

2017 2018 2019 2020

7 NUMBER OF FINANCIAL INSTITUTIONS 1

as of period indicated

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4 Q1 r Q2 p

TOTAL 28,539 28,550 28,716 28,899 29,044 20,924 24,237 24,998 25,845 26,283 26,743 27,220 27,616 27,844

Head Offices 6,251 6,220 6,214 6,176 6,173 1,451 1,736 1,827 1,864 1,862 1,877 1,873 1,883 1,884

Branches/Agencies 22,288 22,330 22,502 22,723 22,871 19,473 22,501 23,171 23,981 24,421 24,866 25,347 25,733 25,960

A. BANKS 11,278 11,392 11,572 11,793 11,936 12,066 12,148 12,364 12,427 12,543 12,688 12,870 12,905 12,912

Head Offices 599 593 592 587 585 581 574 571 569 554 552 547 542 541


1. Universal and Commercial Banks 6,286 6,331 6,403 6,483 6,527 6,569 6,610 6,642 6,660 6,676 6,865 6,915 6,991 6,993

Head Offices 42 42 43 43 43 43 44 45 46 46 46 46 46 46


2. Thrift Banks 2,211 2,246 2,330 2,417 2,453 2,525 2,562 2,657 2,666 2,720 2,616 2,683 2,656 2,654

Head Offices 59 58 57 55 55 55 54 54 53 51 51 50 49 48


a. Savings and Mortgage Banks 1,618 1,649 1,728 1,817 1,849 1,920 1,944 2,029 1,921 1,988 1,879 1,948 1,893 ‐

Head Offices 25 25 24 24 24 24 24 24 23 23 22 22 21 ‐

Branches/Agencies 1,593 1,624 1,704 1,793 1,825 1,896 1,920 2,005 1,898 1,965 1,857 1,926 1,872 ‐

b. Private Development Banks 405 409 414 418 420 421 426 435 435 422 426 429 457

Head Offices 18 17 17 17 17 17 17 17 17 15 16 16 16

Branches/Agencies 387 392 397 401 403 404 409 418 418 407 410 413 441

c. Stock Savings and Loan Associations 184 184 184 178 179 179 187 188 305 305 306 306 306

Head Offices 15 15 15 13 13 13 12 12 12 12 12 12 12


d. Microfinance Banks 4 4 4 4 5 5 5 5 5 5 5 0 0

Head Offices 1 1 1 1 1 1 1 1 1 1 1 0 0


3. Rural Banks 2,781 2,815 2,839 2,893 2,956 2,972 2,976 3,065 3,101 3,147 3,207 3,272 3,258 3,265

Head Offices 498 493 492 489 487 483 476 472 470 457 455 451 447 447


B. NON ‐BANKING FINANCIAL INSTITUTIONS 2 17,258 17,155 17,141 17,103 17,106 8,856 12,087 12,632 13,416 13,738 14,054 14,349 14,710 14,931 a

Head Offices 5,649 5,624 5,619 5,586 5,586 868 1,160 1,254 1,293 1,306 1,324 1,325 1,340 1,342


1. Investment Houses 25 25 25 25 24 24 24 24 24 24 24 14 14 5

Head Offices 15 15 15 15 14 14 14 14 14 14 14 13 13 4

Branches/Agencies 10 10 10 10 10 10 10 10 10 10 10 1 1 1

2. Finance Companies 152 153 161 162 163 163 163 163 171 174 180 180 179 130

Head Offices 23 23 23 23 23 23 23 23 23 23 24 24 23 4


3. ABB Forex Corporations 5 5 5 5 5 5 5 5 4 4 4 2 2 ‐

Head Offices 5 5 5 5 5 5 5 5 4 4 4 2 2 ‐

Branches/Agencies 0 0 0 0 0 0 0 0 0 0 0 0 0 ‐

4. Investment Companies 1 1 1 1 1 1 1 1 1 1 1 1 1 ‐

Head Offices 1 1 1 1 1 1 1 1 1 1 1 1 1 ‐


5. Securities Dealers/Brokers 12 12 13 13 13 13 13 13 13 13 13 13 13 ‐

Head Offices 12 12 13 13 13 13 13 13 13 13 13 13 13 ‐


6. Pawnshops 16,740 16,637 16,613 16,582 16,582 8,331 11,563 12,107 12,879 13,190 13,497 13,801 14,162 14,381

Head Offices 5,401 5,378 5,371 5,346 5,346 627 920 1,013 1,051 1,062 1,076 1,077 1,092 1,092


7. Lending Investors 1 1 1 1 1 1 1 1 1 1 1 1 1 ‐

Head Offices 1 1 1 1 1 1 1 1 1 1 1 1 1 ‐


8. Non‐Stock Savings and Loan Associations 198 197 197 197 198 198 197 196 200 200 200 200 200 200

Head Offices 67 65 65 65 64 64 63 62 63 63 63 63 63 63


9. Government Non‐Banks 3 4 4 4 4 4 4 4 4 4 4 4 4 4 2

Head Offices 4 4 4 4 4 4 4 4 4 4 4 4 4 2


10. Venture Capital Coporations 0 0 0 0 0 0 0 0 0 0 0 0 0 ‐

Head Offices 0 0 0 0 0 0 0 0 0 0 0 0 0 ‐


11. Credit Card Companies 4 4 4 4 4 4 4 5 5 5 5 5 5 ‐

Head Offices 4 4 4 4 4 4 4 5 5 5 5 5 5 ‐


12. Other Non‐Bank with QBF 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Head Offices 1 1 1 1 1 1 1 1 1 1 1 1 1 1


13. Electronic Money Issuer 5 5 5 5 7 8 8 9 10 18 21 24 25 ‐

Head Offices 5 5 5 5 7 8 8 9 10 12 15 18 19 ‐


14. Remittance Agent 1 1 1 1 1 1 1 1 1 1 1 0 0 ‐

Head Offices 1 1 1 1 1 1 1 1 1 1 1 0 0 ‐


15. Credit Granting Entities 9 9 9 9 9 9 9 9 9 9 9 9 9 ‐

Head Offices 9 9 9 9 9 9 9 9 9 9 9 9 9 ‐


16. Trust Corporations 4 2 2 3 3 3 3 3 3 3 3 3 4 4 ‐

Head Offices 2 2 3 3 3 3 3 3 3 3 3 4 4 ‐


17. Private Insurance Companies 5 98 98 98 90 90 90 90 90 90 90 90 90 90 90

Head Offices 98 98 98 90 90 90 90 90 90 90 90 90 90 90


C. OFF‐SHORE BANKING UNITS 3 3 3 3 2 2 2 2 2 2 1 1 1 1

1 Refers to the number of financial establishments which includes the head offices and branches; excludes the Bangko Sentral ng Pilipinas. Starting Q4 2009, data include other banking offices per Circular 505 and 624 dated 22 December 2005 and 13 October 2008, respectively. Other banking offices refer to any office or

place of business in the Philippines other than the head office, branch or extension office, which primarily engages in banking activities other than the acceptance of deposits and/or servicing of withdrawals thru tellers and other authorized personnel. In 2017, per Circular 987 dated 28 December 2017, the term

"Other Banking Units" was replaced by branch/branch‐lite units. A branch shall refer to any permanent office or place of business in the Philippines other than the head office where a bank may perform activities and provide products and services that are within the scope of its authority and relevant licenses.

In this respect, a complete set of books and records shall be maintained in each branch. A branch‐lite unit shall refer to any permanent office or place of business of a bank other than its head office or branch and performs limited banking activities and records its transactions in the books of the head office or

the branch to which it is annexed.2 Includes Private Insurance Companies3 Includes Government Service Insurance System (GSIS) and Social Security System (SSS)4 Trust Corporations started on December 20165 Covers only the head office and their foreign branchesa Includes 86 head offices and 36 branches that are collectively classified as "Others" , which include Investment Houses (without Quasi‐Banking Functions), Finance Companies (without Quasi‐Banking Functions), Investment Companies (without Quasi‐Banking Functions), Securities

Dealers/Brokers, Lending Investors, Venture Capital Corporations, Credit Card Companies, Government Non‐Banks, Electronic Money Issuer‐Others, AAB Forex Corporations, Remittance Agent, Credit Granting Entities and Trust Corporations. p Preliminaryr Revised

‐ Not Available

Source: Bangko Sentral ng Pilipinas, Insurance Commission

2017 2018 2019 2020

8 TOTAL RESOURCES OF THE FINANCIAL SYSTEM 1


Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

TOTAL 17,587.1 17,998.6 18,415.2 19,262.4 19,442.5 19,810.2 20,245.3 21,100.1 21,212.4 21,599.9 22,190.4 22,930.5 r 23,000.4 r 23,296.2 p

Banks 14,118.0 14,577.4 14,959.8 15,524.3 15,676.0 16,052.7 16,463.2 17,258.6 17,387.0 17,589.4 18,029.8 18,711.5 18,781.3 r 19,077.2 p

Universal and Commercial Banks 12,730.2 13,150.5 13,532.6 14,053.8 14,202.8 14,554.5 14,940.0 15,691.5 15,813.9 16,018.9 16,568.1 17,216.1 17,345.8 17,620.1

Thrift Banks 1,149.5 1,182.6 1,176.5 1,213.9 1,214.4 1,236.6 1,254.0 1,293.2 1,297.9 1,287.8 1,176.7 1,203.9 1,144.4 1,165.9

Rural Banks 2 238.3 244.2 250.8 256.5 258.8 261.5 269.2 273.9 275.2 282.6 285.0 291.5 291.2 r 291.2 b

Non‐Banks 3 3,469.1 3,421.2 3,455.4 3,738.1 3,766.5 3,757.6 3,782.1 3,841.5 3,825.4 4,010.5 4,160.6 4,219.0 r 4,219.0 a 4,219.0 a

Notes: Details may not add up to total due to rounding.1 Excludes the Bangko Sentral ng Pilipinas; amount includes allowance for probable losses2 Data on Rural Banks are based on the Financial Reporting Package (FRP).3 Data on Non‐Banks are based on the Consolidated Statement of Condition (CSOC); include investment houses, finance companies, investment companies, securities dealers/brokers, pawnshops, lending investors, non‐stock savings and loan associations,

credit card companies (which are under the BSP's supervision), and private and government insurance companies (i.e., SSS and GSIS).p preliminarya As of end‐December 2019b As of end‐March 2020

Source: BSP

2018 2019 20202017Institutions

9 NON‐PERFORMING LOANS (NPL), TOTAL LOANS AND LOAN LOSS PROVISIONS (LLP) OF THE BANKING SYSTEM1


Total

Universal

Banks and

Commercial

Banks

Thrift

Banks

Rural

BanksTotal

Universal

Banks and

Commercial

Banks

Thrift

Banks

Rural

BanksTotal

Universal

Banks and

Commercial

Banks

Thrift

Banks

Rural

BanksTotal

Universal

Banks and

Commercial

Banks

Thrift

Banks

Rural

Banks

154.180 99.712 40.069 14.399 49.584 24.465 20.104 5.015 7,671.601 6,751.129 792.147 128.324 177.096 138.546 27.883 10.667

158.673 101.006 40.153 17.514 56.890 28.570 20.578 7.741 8,027.796 7,089.734 802.118 135.944 179.698 139.280 27.751 12.668

160.355 105.360 40.320 14.675 73.707 44.052 23.773 5.882 8,396.012 7,435.519 825.100 135.393 183.073 143.486 28.179 11.408

152.986 97.531 40.449 15.006 68.040 36.919 24.795 6.326 8,865.600 7,867.078 860.303 138.219 184.251 145.835 26.929 11.487

165.823 104.400 44.633 16.790 78.348 40.841 30.151 7.355 8,997.103 7,996.321 865.484 135.299 198.475 159.597 26.654 12.225

174.784 110.606 46.664 17.514 83.857 45.425 30.691 7.741 9,352.989 8,331.360 885.685 135.944 199.509 158.846 27.995 12.668

176.611 112.762 47.095 16.754 86.715 48.373 31.466 6.876 9,706.820 8,658.774 907.083 140.962 195.766 155.904 27.114 12.747

177.845 113.518 48.261 16.066 87.860 48.459 33.086 6.315 10,077.929 9,017.780 916.874 143.275 187.124 148.339 26.256 12.530

205.858 134.564 54.458 16.836 106.745 60.169 39.912 6.663 9,989.163 8,918.522 925.944 144.697 196.974 158.379 25.801 12.794

215.907 143.793 55.187 16.927 116.419 68.377 41.034 7.008 10,288.556 9,204.615 935.267 148.674 201.421 162.826 25.852 12.744

227.604 158.671 51.723 17.210 118.178 73.308 37.397 7.473 10,564.232 9,552.943 860.726 150.563 209.069 171.386 25.049 12.634

224.105 156.527 51.670 15.908 115.848 71.552 37.347 6.949 10,966.112 9,953.964 860.307 151.840 207.507 170.518 24.831 12.158

249.184 r 187.980 44.197 17.007 r132.256 93.616 31.075 7.566 r

11,092.659 10,137.354 803.596 151.709 r 227.630 192.078 23.020 12.532 r

274.330 p 212.283 45.040 17.007 a141.003 104.918 28.519 7.566 a

10,824.623 9,883.909 789.005 151.709 a 301.410 261.662 27.216 12.532 a

Note: Details may not add up to total due to rounding.1 Data include banks under liquidation, foreign office transactions and interbank loans2 Starting January 2013, NPL data are based on BSP Circular No. 772. Gross NPL represents the actual level of NPL without any adjustment for loans treated as "loss" and fully provisioned.

As a complementary measure to computing gross NPL, banks shall likewise compute their net NPLs, which shall refer to gross NPLs less specific allowance for credit losses on the total loan portfolio.

Under BSP Circular No. 772, there are no available data for gross NPLs and net NPLs earlier than 2012.p preliminaryr reviseda As of end‐March 2020


LOAN LOSS PROVISIONS (LLP)GROSS NON‐PERFORMING LOANS 2 NET NON‐PERFORMING LOANS 2 TOTAL LOANS

Dec

2018

Mar

2017

Mar

Sep

Jun

2019

Mar

Jun

Sep

Jun

Dec

Sep

Dec

2020

Mar

Jun

9 RATIOS OF NON‐PERFORMING LOANS (NPL) AND LOAN LOSS PROVISIONS (LLP) TO TOTAL LOANS OF THE BANKING SYTEM1

as of periods indicated; in percent

Total

Universal

Banks and

Commercial

Banks

Thrift

Banks

Rural

BanksTotal

Universal

Banks and

Commercial

Banks

Thrift

Banks

Rural

BanksTotal

Universal

Banks and

Commercial

Banks

Thrift

Banks

Rural

Banks

2.010 1.477 5.058 11.221 0.646 0.362 2.538 3.908 2.308 2.052 3.520 8.313

1.977 1.425 5.006 12.883 0.709 0.403 2.566 5.695 2.238 1.965 3.460 9.318

1.910 1.417 4.887 10.839 0.878 0.592 2.881 4.344 2.180 1.930 3.415 8.426

1.726 1.240 4.702 10.857 0.767 0.469 2.882 4.577 2.078 1.854 3.130 8.310

1.843 1.306 5.157 12.409 0.871 0.511 3.484 5.436 2.206 1.996 3.080 9.035

1.869 1.328 5.269 12.883 0.897 0.545 3.465 5.694 2.133 1.907 3.161 9.319

1.819 1.302 5.192 11.885 0.893 0.559 3.469 4.878 2.017 1.801 2.989 9.043

1.765 1.259 5.264 11.213 0.872 0.537 3.609 4.408 1.857 1.645 2.864 8.745

2.061 1.509 5.881 11.636 1.069 0.675 4.310 4.605 1.972 1.776 2.786 8.842

2.099 1.562 5.901 11.385 1.132 0.743 4.387 4.713 1.958 1.769 2.764 8.572

2.154 1.661 6.009 11.430 1.119 0.767 4.345 4.963 1.979 1.794 2.910 8.391

2.044 1.573 6.006 10.477 1.056 0.719 4.341 4.577 1.892 1.713 2.886 8.007

2.246 r 1.854 5.500 11.210 r 1.192 r 0.923 3.867 4.987 r 2.052 r 1.895 2.865 8.261 r

2.534 p 2.148 5.708 11.210 a 1.303 p 1.062 3.615 4.987 a 2.784 p 2.647 3.449 8.261 a

Note: Details may not add up to total due to rounding.1 Data include banks under liquidation, foreign office transactions and interbank loans2 Starting September 2002, for supervisory purposes, computation of NPL was based on BSP Circular No.351 which defines total loans as gross of allowance for probable losses and interbank loans less loans

classified as loss. This has been discontinued in 2013. For comparability purposes, 2012 was revised based on the new definition (BSP Circular No. 772).2 Starting January 2013, NPL data are based on BSP Circular No. 772. Gross NPL represents the actual level of NPL without any adjustment for loans treated as "loss" and fully provisioned.

As a complementary measure to computing gross NPL, banks shall likewise compute their net NPLs, which shall refer to gross NPLs less specific allowance for credit losses on the total loan portfolio.

Under BSP Circular No. 772, there are no available data for gross NPLs and net NPLs earlier than 2012.p preliminaryr reviseda As of end‐March 2020


Dec

Mar

Sep

Dec

Jun

Mar

2020

Mar

Jun

Sep

Sep

GROSS NPL/TOTAL LOANS 2 NET NPL/TOTAL LOANS 2 LLP/TOTAL LOANS

Jun

Jun

2017

Mar

2018

Dec

2019

10 STOCK MARKET TRANSACTIONSvolume in million shares; value in million pesos

for periods indicated

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

VOLUME 140,555.10 109,228.07 106,922.13 83,842.20 176,368.76 77,403.69 73,147.70 76,927.02 118,437.27 68,292.75 94,723.73 50,850.46 65,360.84 58,308.42

Financials 1,494.89 1,855.35 1,153.34 983.32 1,691.30 918.73 866.73 878.91 988.08 849.69 948.76 707.92 894.66 1,110.29

Industrial 9,603.84 8,540.72 16,458.74 6,357.53 6,709.75 7,032.50 5,558.32 9,259.84 8,503.59 11,244.40 6,961.13 6,795.33 8,505.36 8,932.34

Holding Firms 29,925.79 12,966.29 6,082.04 5,942.57 9,900.75 8,262.96 12,040.93 7,305.76 15,166.19 8,336.65 8,209.33 8,993.59 6,511.73 6,837.23

Property 22,112.95 26,846.85 23,254.68 13,481.64 29,646.66 16,290.35 13,057.13 9,918.88 10,488.32 10,661.23 11,569.70 8,124.49 8,775.65 7,017.17

Services 29,620.77 21,897.34 13,572.51 14,093.07 26,533.78 9,909.69 15,136.08 12,894.89 22,320.22 10,736.35 12,499.88 5,679.05 9,838.84 10,370.52

Mining and Oil 47,548.56 36,877.26 46,142.53 42,548.86 101,365.44 34,755.01 26,028.00 36,146.06 59,639.12 25,970.92 53,799.51 20,170.32 30,638.17 21,218.37

SME (in thousand shares) 247,653.15 243,479.20 257,034.11 433,789.64 518,403.30 232,923.99 459,872.31 521,981.35 1,331,137.77 493,010.10 734,728.79 379,173.63 192,707.49 2,821,206.14

ETF (in thousand shares) 656.00 775.47 1,251.54 1,405.90 2,669.01 1,518.76 648.07 705.98 615.90 504.87 689.96 591.63 3,731.60 1,305.85

VALUE 436,165.38 557,721.60 509,396.60 455,080.53 520,924.61 394,543.07 361,275.84 460,078.84 488,944.71 443,994.24 442,192.02 397,447.97 400,594.39 390,596.08

Financials 62,313.96 97,068.69 68,693.92 65,769.55 85,980.22 61,896.89 60,084.23 63,110.03 71,699.61 69,698.97 67,156.74 61,878.65 58,705.13 63,509.14

Industrial 95,489.04 124,385.03 160,294.25 106,937.03 82,559.19 77,427.38 61,868.59 133,338.65 83,951.13 88,542.93 84,172.39 60,437.96 74,440.53 74,463.46

Holding Firms 107,783.53 117,476.74 92,603.00 110,077.77 124,682.97 95,230.78 92,800.99 87,756.71 127,680.38 97,898.87 103,251.91 134,980.92 98,857.38 92,863.59

Property 73,842.80 91,340.89 79,276.90 73,557.35 95,940.50 80,284.39 72,660.22 70,210.07 95,409.31 101,224.12 98,445.18 68,185.02 102,444.66 64,214.23

Services 76,891.34 109,908.80 86,867.92 76,297.12 109,823.19 68,917.92 61,026.58 93,142.16 101,331.64 77,768.03 70,051.23 63,291.93 61,278.24 82,590.90

Mining and Oil 17,704.20 15,512.58 19,889.11 18,925.90 18,827.94 9,660.99 10,797.85 11,561.69 6,453.15 8,090.87 14,772.38 7,280.99 4,105.81 4,169.97

SME (in thousand pesos) 2,061,917.61 1,931,746.40 1,621,229.93 3,338,478.72 2,760,867.64 949,655.45 1,964,591.75 883,959.02 2,347,074.10 710,905.94 4,259,331.31 1,323,137.39 420,402.32 8,669,032.86

ETF (in thousand pesos) 78,598.62 97,128.21 150,269.19 177,322.51 349,733.29 175,059.50 72,778.74 75,578.02 72,405.52 59,547.11 82,847.94 69,350.11 342,221.15 115,749.36

Composite Index (end‐of‐period) 7,311.72 7,843.16 8,171.43 8,558.42 7,979.83 7,193.68 7,276.82 7,466.02 7,920.93 7,999.71 7,779.07 7,815.26 5,321.23 6,207.72

Note: Details may not add up due to rounding.

Source: Philippine Stock Exchange (PSE)

2017 2018 2019 2020

11PHILIPPINES: BALANCE OF PAYMENTS

in million US dollars

Q1 Q2 Q3 Q4 Q1 Q2 Q2 2020 p

Current Account ‐1,710 ‐931 ‐356 ‐389 ‐23 4,382 570.9

(Totals as percent of GNI) ‐1.8 ‐0.9 ‐0.4 ‐0.3 . 4.9

(Totals as percent of GDP) ‐2.0 ‐1.0 ‐0.4 ‐0.4 . 5.3

Export 32,012 33,582 35,297 35,471 30,575 24,061 ‐28.4

Import 33,722 34,513 35,653 35,860 30,598 19,678 ‐43.0

Goods, Services, and Primary Income ‐8,367 ‐7,612 ‐7,346 ‐7,770 ‐6,661 ‐1,732 77.2

Export 25,139 26,687 28,143 27,896 23,700 17,758 ‐33.5

Import 33,506 34,299 35,489 35,666 30,360 19,490 ‐43.2

Goods and Services ‐9,694 ‐8,821 ‐8,605 ‐9,303 ‐7,755 ‐2,768 68.6

(Totals as percent of GNI) ‐10.4 ‐8.6 ‐8.5 ‐7.9 ‐8.0 ‐3.1

(Totals as percent of GDP) ‐11.5 ‐9.5 ‐9.4 ‐8.6 ‐8.9 ‐3.4

Export 21,918 23,352 24,877 24,358 20,559 15,171 ‐35.0

Import 31,612 32,173 33,482 33,662 28,315 17,939 ‐44.2

Goods ‐12,293 ‐12,127 ‐12,340 ‐12,554 ‐10,295 ‐5,429 55.2

(Totals as percent of GNI) ‐13.1 ‐11.8 ‐12.2 ‐10.7 ‐10.7 ‐6.0

(Totals as percent of GDP) ‐14.6 ‐13.0 ‐13.5 ‐11.6 ‐11.8 ‐6.6

Credit: Exports 12,375 13,633 14,123 13,345 11,602 9,094 ‐33.3

Debit: Imports 24,668 25,760 26,462 25,899 21,897 14,523 ‐43.6

Services 2,599 3,306 3,734 3,251 2,540 2,660 ‐19.5

Credit: Exports 9,543 9,719 10,754 11,014 8,958 6,077 ‐37.5

Debit: Imports 6,944 6,413 7,020 7,763 6,418 3,416 ‐46.7

Primary Income 1,327 1,209 1,259 1,533 1,095 1,036 ‐14.3

Credit: Receipts 3,221 3,335 3,266 3,538 3,140 2,587 ‐22.4

Debit: Payments 1,894 2,126 2,007 2,005 2,045 1,551 ‐27.0

Secondary Income 6,657 6,681 6,990 7,381 6,638 6,115 ‐8.5

Credit: Receipts 6,873 6,895 7,154 7,575 6,875 6,303 ‐8.6

Debit: Payments 216 214 164 193 237 188 ‐11.9

Capital Account 25 22 20 19 7 8 ‐61.2

Credit: Receipts 30 25 23 25 17 17 ‐34.3

Debit: Payments 6 4 4 7 10 8 118.8

Financial Account ‐5,258 ‐278 391 ‐2,116 3,785 152 154.8

Net Acquisition of Financial Assets 1,914 3,530 4,038 ‐202 1,572 2,169 ‐38.6

Net Incurrence of Liabilities 7,172 3,807 3,647 1,914 ‐2,214 2,017 ‐47.0

Direct Investment ‐1,046 ‐727 ‐825 ‐1,778 ‐1,061 ‐1,107 ‐52.2

Net Acquisition of Financial Assets 892 1,005 795 618 739 90 ‐91.0

Net Incurrence of Liabilities 1,938 1,731 1,620 2,396 1,800 1,197 ‐30.9

Portfolio Investment ‐3,037 ‐1,884 474 962 750 731 138.8

Net Acquisition of Financial Assets 1,351 475 2,080 74 ‐450 1,995 320.0

Net Incurrence of Liabilities 4,388 2,359 1,606 ‐888 ‐1,200 1,263 ‐46.4

Financial Derivatives ‐40 ‐42 ‐60 ‐31 ‐74 ‐20 52.2

Net Acquisition of Financial Assets ‐235 ‐233 ‐235 ‐171 ‐271 ‐179 23.1

Net Incurrence of Liabilities ‐195 ‐192 ‐175 ‐140 ‐197 ‐159 16.8

Other Investment ‐1,135 2,375 803 ‐1,269 4,171 548 ‐76.9

Net Acquisition of Financial Assets ‐94 2,283 1,399 ‐723 1,554 263 ‐88.5

Net Incurrence of Liabilities 1,040 ‐92 596 546 ‐2,617 ‐284 ‐209.6

Net Unclassified Items 225 1,622 1,506 531 3,733 ‐62 ‐103.8

Overall BOP Position 3,797 991 778 2,277 ‐68 4,177 321.5

(Totals as percent of GNI) 4.1 1.0 0.8 1.9 ‐0.1 4.6

(Totals as percent of GDP) 4.5 1.1 0.9 2.1 ‐0.1 5.1

Debit: Change in Reserve Assets 3,808 980 789 2,266 ‐58 4,165 324.9

Credit: Change in Reserve Liabilities 11 ‐11 10 ‐11 10 ‐12 ‐7.1

Details may not add up to total due to roundingp Preliminaryr Revised to reflect data updates from official data sources and post‐audit adjustments


Technical Notes:

1. Balance of Payments Statistics are based on the IMF's Balance of Payments and International Investment Position Manual, 6th edition.

2. Financial Account, including Reserve Assets, is calculated as sum of net acquisitions of financial assets less net incurrence of liabilities.

3. Balances in the current and capital accounts are derived by deducting debit entries from credit entries.

4. Balances in the financial account are derived by deducting net incurrence of liabilities from net acquisition of financial assets.

5. Negative values of Net Acquisition of Financial Assets indicate withdrawal/disposal of financial assets; negative values of Net Incurrence of Liabilities

indicate repayment of liabilities.

6. Overall BOP position is calculated as the change in the country's net international reserves (NIR), less non‐economic transactions (revaluation and gold

monetization/demonetization). Alternatively, it can be derived by adding the current and capital account balances less financial account plus net unclassified items.

7. Net unclassified items is an offsetting account to the overstatement or understatement in either receipts or payments of the recorded BOP

components vis‐à‐vis the overall BOP position.

8. Data on deposit‐taking corporations, except the central bank, consist of transactions of commercial and thrift banks and offshore banking units (OBUs).


Growth

Rates (in %)

2019 r 2020 p

12 INTERNATIONAL RESERVESas of periods indicated; in million US dollars

Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun

Gross International Reserves 80,894 81,321 80,962 81,570 80,511 77,525 74,939 79,193 83,613 84,932 85,582 87,840 88,861 93,470

Gold 7,888 7,835 8,065 8,337 8,375 7,913 7,577 8,153 8,214 8,016 8,016 8,016 8,016 8,016

SDRs 1,149 1,179 1,198 1,211 1,233 1,194 1,186 1,184 1,183 1,186 1,164 1,182 1,168 1,177

Foreign Investments 67,677 68,160 65,371 65,815 64,931 62,356 59,850 66,733 71,409 72,541 72,971 75,304 76,480 80,891

Foreign Exchange 3,735 3,695 5,880 5,783 5,542 5,573 5,842 2,649 2,283 2,665 2,870 2,747 2,619 2,655

Reserve Position in the Fund 446 453 448 424 430 489 483 474 525 524 561 590 578 731

Net International Reserves 1 80,881 81,318 80,948 81,567 80,497 77,521 74,924 79,189 83,598 84,927 85,567 87,836 88,848 93,468

Reserve Adequacy Measures

Import Cover 2 8.5 8.4 8.2 7.8 7.6 7.1 6.6 6.9 7.2 7.3 7.4 7.6 7.9 9.3

Short‐Term External Debt Cover 3

Original Maturity 4 537.1 558.9 569.4 571.4 626.7 640.6 555.7 492.9 497.6 545.1 537.9 510.5 666.6 870.6

Residual Maturity 5 405.1 409.5 406.0 419.3 474.6 448.1 415.9 368.8 357.3 411.4 406.1 401.7 453.5 534.5

Note: Details may not add up to total due to rounding1 Inclusive of gold monetization and revaluation of reserve assets and reserve‐related liabilties which are excluded in the calculation of the balance of payments (BOP). Net International Reserves (NIR) refer to the difference

between Gross International Reserves (GIR) and the total of the Bangko Sentral's short‐term liabilities and the Use of Fund Credits (UFC). UFC refers to the sum of outstanding drawings from the IMF under various policies

and facilities, other than drawings under the reserve tranche.2 Number of months of average imports of goods and payment of services and primary income that can be financed by reserves. Starting 2005, data are based on International Monetary Fund's Balance of Payments and

and International Investment Position Manual, 6th edition (BPM6) concept.3 Starting December 2005, outstanding annual external debt reflects the new reporting framework in line with international standards under the latest External Debt Statistics Guide and BPM6. 4 Based on latest available outstanding short‐term external debt. 5 Refers to adequacy of reserves to cover outstanding external short‐term debt based on original maturity plus principal payments on medium‐and long‐term loans of the public and private sectors falling due in the next 12 months.

Figures reflect data based on outstanding short‐term debt and debt service schedule on outstanding external debt as of 30 June 2020.


2018 2019 20202017

13 EXCHANGE RATES OF THE PESOperiod averages; pesos per unit of foreign currency

2017 Ave 50.4037 0.4495 56.9491 64.9706 38.6418 36.5254 6.4686 11.7326 1.4866 0.0038 1.6574 0.0446 7.4593 13.4412 13.7244

Q1 49.9910 0.4401 53.2686 61.9521 37.8889 35.3106 6.4419 11.2478 1.4234 0.0037 1.6098 0.0434 7.2569 13.3323 13.6123

Q2 49.8577 0.4488 54.8473 63.7537 37.4333 35.8146 6.4038 11.5068 1.4537 0.0037 1.6481 0.0442 7.2646 13.2954 13.5756

Q3 50.8408 0.4580 59.7174 66.5855 40.1118 37.3672 6.5061 11.9324 1.5230 0.0038 1.6805 0.0449 7.6207 13.5575 13.8428

Q4 50.9255 0.4511 59.9631 67.5910 39.1333 37.6091 6.5227 12.2433 1.5461 0.0038 1.6914 0.0460 7.6951 13.5796 13.8669

2018 Ave 52.6614 0.4769 62.1943 70.3179 39.3810 39.0471 6.7197 13.0642 1.6302 0.0037 1.7481 0.0479 7.9713 14.0414 14.3387

Q1 51.4540 0.4753 63.2595 71.6146 40.4724 39.0190 6.5741 13.1161 1.6310 0.0038 1.7570 0.0480 8.0939 13.7207 14.0106

Q2 52.4470 0.4808 62.5318 71.3816 39.6907 39.3140 6.6830 13.2919 1.6446 0.0038 1.7628 0.0486 8.2271 13.9854 14.2803

Q3 53.5494 0.4805 62.2967 69.8379 39.1524 39.1621 6.8260 13.0914 1.6240 0.0037 1.7472 0.0478 7.8721 14.2786 14.5802

Q4 53.1953 0.4709 60.6894 68.4375 38.2084 38.6933 6.7959 12.7575 1.6213 0.0036 1.7255 0.0472 7.6920 14.1811 14.4839

2019 Ave 51.7958 0.4752 57.9894 66.1447 36.0008 37.9748 6.6105 12.5106 1.6686 0.0037 1.6767 0.0445 7.5021 13.8112 14.1026

Q1 52.3571 0.4754 59.4752 68.2126 37.2996 38.6528 6.6732 12.8023 1.6562 0.0037 1.6993 0.0466 7.7609 13.9610 14.2556

Q2 52.0591 0.4738 58.4750 66.8978 36.4156 38.1884 6.6405 12.5591 1.6475 0.0036 1.6738 0.0447 7.6297 13.8823 14.1744

Q3 51.7676 0.4824 57.5713 63.8264 35.4755 37.6554 6.6118 12.4355 1.6863 0.0037 1.6608 0.0434 7.3796 13.8028 14.0949

Q4 50.9993 0.4692 56.4359 65.6419 34.8126 37.4025 6.5164 12.2454 1.6842 0.0036 1.6728 0.0434 7.2381 13.5987 13.8857

2020 Ave 50.6458 0.4680 55.7984 63.8812 33.3039 36.2369 6.5259 11.9322 1.6032 0.0035 1.6889 0.0420 7.2034 13.4928 13.7894

Q1 50.8290 0.4666 56.0530 65.1249 33.5008 36.7322 6.5413 12.1848 1.6280 0.0036 1.6892 0.0427 7.2866 13.5470 13.8393

Q2 50.4626 0.4695 55.5438 62.6375 33.1070 35.7417 6.5104 11.6796 1.5785 0.0034 1.6886 0.0414 7.1201 13.4387 13.7395


Chinese

Yuan

Saudi

Rial

Emirati

Dirham

Australian

Dollar

South

Korean

Won

PeriodUS

Dollar

Japanese

YenEuro

Pound

Sterling

Singapore

Dollar

Hongkong

Dollar

Malaysian

Ringgit

Thailand

Baht

Indonesian

Rupiah

New

Taiwan

Dollar

13a EXCHANGE RATES OF THE PESO period averages; units of foreign currency per peso

2017 Ave 0.0198 2.2252 0.0176 0.0154 0.0259 0.0274 0.1546 0.0853 0.6735 265.9140 0.6036 22.4187 0.1342 0.0744 0.0729

Q1 0.0200 2.2721 0.0188 0.0161 0.0264 0.0283 0.1552 0.0889 0.7025 267.1416 0.6212 23.0270 0.1378 0.0750 0.0735

Q2 0.0201 2.2282 0.0182 0.0157 0.0267 0.0279 0.1562 0.0869 0.6879 268.4602 0.6068 22.6453 0.1377 0.0752 0.0737

Q3 0.0197 2.1836 0.0167 0.0150 0.0249 0.0268 0.1537 0.0838 0.6566 262.3447 0.5951 22.2646 0.1312 0.0738 0.0722

Q4 0.0196 2.2168 0.0167 0.0148 0.0256 0.0266 0.1533 0.0817 0.6468 265.7095 0.5912 21.7380 0.1300 0.0736 0.0721

2018 Ave 0.0190 2.0972 0.0161 0.0142 0.0254 0.0256 0.1488 0.0766 0.6134 269.8477 0.5721 20.8761 0.1255 0.0712 0.0698

Q1 0.0194 2.1040 0.0158 0.0140 0.0247 0.0256 0.1521 0.0762 0.6131 263.6854 0.5692 20.8331 0.1235 0.0729 0.0714

Q2 0.0191 2.0798 0.0160 0.0140 0.0252 0.0254 0.1496 0.0752 0.6081 265.2805 0.5673 20.5740 0.1215 0.0715 0.0700

Q3 0.0187 2.0813 0.0161 0.0143 0.0255 0.0255 0.1465 0.0764 0.6158 273.4316 0.5723 20.9209 0.1270 0.0700 0.0686

Q4 0.0188 2.1237 0.0165 0.0146 0.0262 0.0258 0.1471 0.0784 0.6168 276.9934 0.5795 21.1766 0.1300 0.0705 0.0690

2019 Ave 0.0193 2.0958 0.0172 0.0151 0.0278 0.0263 0.1513 0.0799 0.6013 272.1743 0.5964 22.2961 0.1333 0.0724 0.0709

Q1 0.0191 2.1036 0.0168 0.0147 0.0268 0.0259 0.1499 0.0781 0.6038 269.5659 0.5885 21.4654 0.1289 0.0716 0.0701

Q2 0.0192 2.1108 0.0171 0.0149 0.0275 0.0262 0.1506 0.0796 0.6070 274.1912 0.5975 22.3788 0.1311 0.0720 0.0705

Q3 0.0193 2.0731 0.0174 0.0157 0.0282 0.0266 0.1512 0.0804 0.5930 272.7659 0.6021 23.0442 0.1355 0.0724 0.0709

Q4 0.0196 2.1315 0.0177 0.0152 0.0287 0.0267 0.1535 0.0817 0.5937 276.1289 0.5978 23.0556 0.1382 0.0735 0.0720

2020 Ave 0.0197 2.1366 0.0179 0.0157 0.0300 0.0276 0.1532 0.0838 0.6237 286.3539 0.5921 23.7900 0.1388 0.0741 0.0725

Q1 0.0197 2.1434 0.0178 0.0154 0.0299 0.0272 0.1529 0.0821 0.6143 278.6507 0.5920 23.4217 0.1372 0.0738 0.0723

Q2 0.0198 2.1299 0.0180 0.0160 0.0302 0.0280 0.1536 0.0856 0.6335 294.4950 0.5922 24.1700 0.1404 0.0744 0.0728


PeriodUS

Dollar

Japanese

YenEuro

Pound

Sterling

Australian

Dollar

South

Korean

Won

Chinese

Yuan

Saudi

Rial

Emirati

Dirham

Singapore

Dollar

Hongkong

Dollar

Malaysian

Ringgit

Thailand

Baht

Indonesian

Rupiah

New

Taiwan

Dollar

13b EFFECTIVE EXCHANGE RATE INDICES OF THE PESO1980=100; period averages

Overall

Trading

Partners 1

Advanced

Trading

Partners 2

Developing

Trading

Partners 3

Overall

Trading

Partners 1

Advanced

Trading

Partners 2

Developing

Trading

Partners 3

2017 14.13 11.51 22.54 83.04 79.07 108.35

Q1 14.52 11.86 23.13 86.09 83.07 111.40

Q2 14.36 11.69 22.93 84.85 80.53 110.92

Q3 13.86 11.24 22.19 80.67 76.25 105.72

Q4 13.81 11.30 21.97 80.70 76.61 105.48

2018 13.29 10.83 21.21 80.80 76.96 105.39

Q1 13.28 10.87 21.15 80.42 77.85 103.96

Q2 13.15 10.80 20.90 80.08 76.64 104.17

Q3 13.28 10.74 21.27 80.60 76.02 105.70

Q4 13.48 10.93 21.57 82.16 77.37 107.86

2019 13.77 11.15 22.04 84.45 80.26 110.29

Q1 13.51 11.02 21.55 83.97 81.06 108.71

Q2 13.70 11.11 21.91 84.56 80.20 110.56

Q3 13.83 11.12 22.24 84.11 79.22 110.41

Q4 14.04 11.36 22.49 85.26 80.63 111.66

2020 14.23 11.44 22.87 89.16 84.79 116.41

Q1 14.11 11.43 22.59 88.25 85.23 114.23

Q2 14.35 11.46 23.15 90.06 84.35 118.60

1 Australia, Euro Area, US, Japan, Hong Kong, Taiwan, Thailand, Indonesia, Malaysia, Singapore, South Korea, China,

Saudi Arabia and UAE2 US, Japan, Euro Area and Australia3 Hong Kong, Taiwan, Thailand, Indonesia, Malaysia, Singapore, South Korea, China, Saudi Arabia and UAEr revised


N O M I N A L R E A L

14 TOTAL EXTERNAL DEBT 1

as of periods indicated; in million US dollars

Grand Total 2,154 11,176 68,091 81,421 a 1,978 8,759 76,717 87,453 a

Public Sector 633 44,494 b 45,127 506 50,474 b 50,980

Banks 633 3,167 3,800 506 3,164 3,669

Bangko Sentral ng Pilipinas 1,294 c 1,294 0 1,306 c 1,306

Others 633 1,873 2,506 506 1,857 2,363

Non‐Banks 41,327 41,327 47,311 47,311

NG and Others 41,327 41,327 47,311 47,311

Private Sector 2,154 10,543 23,597 36,294 1,978 8,253 26,243 36,473

Banks 9,816 6,961 16,778 7,638 6,884 14,521

Foreign Bank Branches 4,453 147 4,600 d 4,329 112 4,441 d

Domestic Banks 5,364 6,814 12,178 3,309 6,772 10,080

Non‐Banks 2,154 727 16,636 e 19,516 1,978 616 19,359 e 21,952

1 Covers debt owed to non‐residents, with classification by borrower based on primary obligor per covering loan/rescheduling agreement/document.

31 Mar 2020 30 Jun 2020

Exclusions:a Residents' holdings of Philippine debt papers issued offshore; 16,271 15,432

Non‐residents' holdings of peso‐denominated debt securities 4,550 2,752

Inclusions:b Cumulative foreign exchange revaluation on US $‐denominated

multi‐currency loans from Asian Development Bank and World Bank ‐13 ‐13c Accumulated SDR allocations from the IMF 1,148 1,156 d "Due to Head Office/Branches Abroad" (DTHOBA) accounts of branches and

offshore banking units of foreign banks operating in the Philippines 3,240 2,819e Loans without BSP approval/registration which cannot be serviced

using foreign exchange from the banking system; 6,390 6,867

Obligations under capital lease agreements 861 830


Short‐TermMedium &

Long‐TermTotal

Short‐TermMedium &

Long‐TermTotal

Trade Non‐Trade Trade Non‐Trade

31 March 2020 30 June 2020

15 SELECTED FOREIGN DEBT SERVICE INDICATORS

for periods indicated; in million US dollars

Q1 Q2 Q3 Q4 Q1 Q2

Debt Service Burden (DSB) 1 1,728 3,072 1,354 2,307 2,783 1,200

Principal 841 2,321 529 1,717 2,029 786

Interest 887 751 825 590 754 413

Export Shipments (XS) 2 12,375 13,633 14,123 13,345 11,602 9,094

Exports of Goods and Receipts

from Services and Income (XGSI) 2, 3 30,301 31,808 33,477 33,586 28,926 22,420

Current Account Receipts (CAR) 2 32,012 33,582 35,297 35,471 30,575 24,061

External Debt 80,431 81,259 82,674 83,618 81,421 87,453

Gross Domestic Product (GDP) 84,477 93,303 91,351 107,985 87,535 82,250

Gross National Income (GNI) 93,636 102,529 100,916 117,514 96,619 89,871

RATIOS (%):

DSB to XS 13.97 22.53 9.59 17.29 23.99 13.19

DSB to XGSI 5.70 9.66 4.04 6.87 9.62 5.35

DSB to CAR 5.40 9.15 3.84 6.50 9.10 4.99

DSB to GNI 1.85 3.00 1.34 1.96 2.88 1.33

External Debt to GDP 4 22.89 22.73 22.59 22.19 21.42 23.69

External Debt to GNI 4 20.71 20.58 20.51 20.18 19.50 21.59

1 Debt service burden represents principal and interest payments after rescheduling. In accordance with the internationally‐accepted concept,

debt service burden consists of (a) principal and interest payments on fixed MLT credits including IMF credits, loans covered by the Paris Club and

Commercial Banks rescheduling, and New Money Facilities; and (b) interest payments on fixed and revolving short‐term liabilities of banks and

non‐banks but excludes (i) prepayments of future years' maturities of foreign loans and (ii) principal payments on fixed and revolving ST liabilities

of banks and non‐banks.2 Based on the accounting principle under the Balance of Payments and International Investment Position Manual, Sixth Edition (BPM6)

3 Includes cash remittances of overseas Filipino workers that were coursed through and reported by commercial banks which are reflected under

Compensation of Employees in the Primary Income account and workers' remittances in the Secondary Income account.4 GNI and GDP figures were annualized by taking the sum over the past 4 quarters of the GNI and GDP, respectively.p Preliminary

r Revised to reflect latest data adjustments


2019 r 2020 p

16 SELECTED FOREIGN INTEREST RATES 1

period averages; in percent

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

US Prime Rate 3.7935 4.0455 4.2500 4.2976 4.5265 4.7976 5.0083 5.2817 5.5000 5.5000 5.3016 4.8297 4.4167 3.2500

US Discount Rate 1.2935 1.5455 1.7500 1.7976 2.0265 2.2917 2.5042 2.7778 3.0000 3.0000 2.8016 2.3297 1.8258 0.2500

US Federal Funds Rate 0.6974 0.9486 1.1551 1.2015 1.4356 1.7289 1.9140 2.2048 2.4002 2.3828 2.1713 1.6332 1.2280 0.0547

LIBOR (90 days) 1.0684 1.2023 1.3150 1.4656 1.9274 2.3384 2.3373 2.6325 2.6855 2.5062 2.1947 1.9299 1.5337 0.6021

SIBOR 1 (90 days) 0.9529 0.9961 1.1101 1.1681 1.2800 1.5115 1.6331 1.7326 1.9218 1.9769 1.9188 1.8011 1.5556 0.7195

1 Interest rates based on the US Dollar except for SIBOR, which is based on the Singapore dollar

Source: Bloomberg, Asian Wall Street Journal, Reuters

2018 2019 2020 2017

17 BALANCE SHEET OF THE BANGKO SENTRAL NG PILIPINASas of end‐periods indicated; in billion pesos

Mar Jun Sep Dec rMar Jun Sep Dec r Mar r Jun p

Assets 4,781.7 4,726.6 4,646.3 4,851.6 5,145.1 5,064.5 5,096.0 5,084.2 5,441.1 6,295.4

International Reserves 4,187.1 4,116.8 4,031.0 4,140.2 4,375.2 4,326.7 4,405.8 4,434.1 4,484.2 4,618.6

Domestic Securities 224.9 224.6 224.2 223.3 224.2 224.9 226.1 226.1 237.7 897.8

Loans and Advances 167.0 170.9 180.2 277.5 329.7 301.5 248.8 200.2 162.6 172.8

Government Securities Purchased Under Repurchase Agreements ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 300.0 300.0

Bank Premises and Other Fixed Assets 23.0 22.8 22.9 23.8 23.9 24.2 24.3 24.4 23.5 23.4

Derivative Instruments in a Gain Position 0.1 0.1 . 0.1 0.0 0.1 0.0 . 0.1 0.0

Other Assets 179.6 191.5 188.0 186.8 192.2 187.1 190.9 199.4 233.1 282.8

Liabilities 4,690.3 4,616.1 4,523.8 4,735.1 5,018.3 4,920.2 4,959.9 4,938.6 5,032.5 6,130.9

Currency Issue 1,250.9 1,232.5 1,247.1 1,490.2 1,382.6 1,383.0 1,386.6 1,679.1 1,697.7 1,807.2

Deposits 2,466.8 2,418.0 2,298.2 2,304.1 2,709.5 2,659.1 2,642.0 2,411.2 2,729.8 3,593.5

Reserve Deposits of Other Depository Corporations (ODCs) 1 1,792.9 1,746.2 1,767.8 1,843.8 1,841.0 1,725.9 1,700.3 1,550.5 1,442.0 1,317.4

Reserve Deposits of Other Financial Corporations (OFCs) 2 2.0 1.3 1.3 1.3 0.7 0.7 0.4 0.4 0.4 0.3

Secured Settlement Accounts ‐ 0.3 1.6 2.7 2.7 4.3 3.5 8.1 22.6 17.4

Overnight Deposit Facility 3 24.6 20.1 6.1 58.6 59.9 26.8 82.3 266.2 312.3 1,096.4

Term Deposit Facility 3 182.5 152.2 109.4 69.2 70.1 42.9 174.7 283.2 80.1 200.1

Treasurer of the Philippines 4 318.8 338.6 257.5 170.2 575.1 709.7 533.9 159.9 722.5 825.5

Other Foreign Currency Deposits 0.8 0.8 1.1 1.1 1.3 1.1 1.1 1.1 1.2 3.7

Foreign Financial Institutions 115.1 122.9 122.8 122.8 120.0 115.6 113.2 107.7 107.7 99.2

Other Deposits 5 30.2 35.6 30.6 34.4 38.7 32.2 32.7 34.1 41.0 33.5

Foreign Loans Payable . . . . . . . 0.0 0.0 0.0

Net Bonds Payable 26.7 26.7 27.6 26.3 26.9 25.6 26.5 25.4 25.9 24.9

Derivative Instruments in a Loss Position . . 0.0 0.0 0.1 0.0 . 0.0 0.0 0.4

Derivatives Liability 0.2 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Allocation of SDRs 63.7 63.0 63.4 61.4 61.3 59.8 59.3 58.9 58.1 57.4

Revaluation of Foreign Currency Accounts 6 562.5 588.3 575.4 535.0 569.7 471.0 511.7 425.9 474.2 414.8

Reverse Repurchase Facility 3 305.1 272.0 299.2 301.0 250.7 305.1 302.1 305.1 305.0 200.0

Other Liabilities 14.3 15.5 12.9 17.2 17.5 16.5 31.7 33.0 14.7 32.7

Net Worth 91.4 110.5 122.5 116.5 126.8 144.3 136.0 145.6 135.6 164.5

Capital 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0

Surplus/Reserves 41.4 60.5 72.5 66.5 76.8 94.3 86.0 95.6 85.6 114.5

Note: Details may not add up to total due to rounding1 ODCs are deposit‐generating institutions other than the BSP such as universal and commercial banks (UB/KBs), specialized government banks (SGBs), thrift banks (TBs), rural banks (RBs) and non‐banks with quasi‐banking functions (NBQBs).2 OFCs are trust units of banks.3 Starting 3 June 2016, the Reverse Repurchase Agreement and Special Deposit Account have been replaced by the Reverse Repurchase Facility and Overnight Deposit Facility, respectively and a Term Deposit Facility was introduced in line with the

implementation of the Interest Rate Corridor (IRC) system. Includes accrued interest payables.4 Includes foreign currency deposits5 Mostly GOCC deposits6 Previously named Revaluation of International Reservesp Based on the preliminary and unaudited BSP Financial Statements (FS) prepared by the Financial Accounting Department (FAD) of the BSP.

r Revised to reflect restated and audited figures for December 2018 and December 2019, respectively, based on the audited 2019 BSP FS and latest end‐month figures for March 2020 based on the unaudited BSP FS as of end‐March 2020.


‐ Not applicable


2018 2019 2020 p

18 INCOME POSITION OF THE BANGKO SENTRAL NG PILIPINASfor periods indicated; in billion pesos

Q1 Q2 Q3 Q4 r FY r Q1 Q2 Jan‐Jun Q3 Q4 r FY

rQ1

pQ2

pJan‐Jun

p

Revenues 14.918 22.160 12.556 18.405 68.039 26.410 38.906 65.316 30.005 26.355 121.676 26.124 20.786 46.910

Interest Income 16.878 19.006 19.914 22.364 78.162 25.675 27.546 53.221 25.070 22.124 100.415 20.799 18.051 38.850

International Reserves 14.182 15.865 16.387 17.729 64.163 20.195 20.761 40.956 19.925 17.814 78.695 17.198 12.369 29.567

Domestic Securities 1.461 1.686 2.023 2.346 7.516 3.051 3.232 6.283 2.712 2.401 11.396 1.962 3.818 5.780

Loans and Advances 0.480 0.524 0.543 1.126 2.673 1.509 2.370 3.879 1.510 0.831 6.220 0.615 0.581 1.196

Others 0.755 0.931 0.961 1.163 3.810 0.920 1.183 2.103 0.923 1.078 4.104 1.024 1.283 2.307

Miscellaneous Income 1 ‐2.013 3.104 ‐7.532 ‐3.846 ‐10.287 0.711 11.221 11.932 4.848 4.176 20.956 5.296 2.713 8.009

Net Income from Branches 0.053 0.050 0.174 ‐0.113 0.164 0.024 0.139 0.163 0.087 0.055 0.305 0.029 0.022 0.051

Expenses 12.143 16.981 15.641 21.508 66.273 18.950 22.483 41.433 20.851 25.050 87.334 18.225 16.405 34.630

Interest Expenses 6.431 6.592 7.881 9.031 29.935 10.330 11.162 21.492 12.224 10.972 44.688 10.957 10.274 21.231

Legal Reserve Deposits of Banks 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

National Government Deposits 1.954 1.879 2.385 3.202 9.420 4.452 6.668 11.120 5.822 3.041 19.983 2.514 2.965 5.479

Reverse Repurchase Facility 2 2.266 2.179 2.564 3.104 10.113 3.176 2.801 5.977 3.241 3.040 12.258 2.843 1.001 3.844

Overnight Deposit Facility 2 0.592 0.231 0.172 0.346 1.341 0.601 0.241 0.842 0.605 1.101 2.548 1.704 5.017 6.721

Term Deposit Facility 2 0.908 1.539 1.876 1.495 5.818 1.153 0.545 1.698 1.698 2.976 6.372 3.077 0.577 3.654

Loans Payable and Other Foreign Currency Deposits 0.696 0.724 0.832 0.847 3.099 0.886 0.850 1.736 0.837 0.774 3.347 0.756 0.686 1.442

Other Liabilities 0.015 0.040 0.052 0.037 0.144 0.062 0.057 0.119 0.021 0.040 0.180 0.063 0.028 0.091

Cost of Minting/Printing of Currency 1.893 2.329 2.818 4.220 11.260 3.544 3.082 6.626 2.611 3.236 12.473 2.442 2.123 4.565

Taxes and Licenses 0.397 2.476 0.446 2.204 5.523 0.774 3.868 4.642 0.753 3.671 9.066 0.320 ‐0.037 0.283

Others 3.422 5.584 4.496 6.053 19.555 4.302 4.371 8.673 5.263 7.171 21.107 4.506 4.045 8.551

Net Income/(Loss) Before Gain/(Loss) on FXR Fluctuations

and Income Tax Expense/(Benefit) 2.775 5.179 ‐3.085 ‐3.103 1.766 7.460 16.423 23.883 9.154 1.305 34.342 7.899 4.381 12.280

Net Gain/(Loss) on Foreign Exchange Rate Fluctuations 3 7.040 14.471 27.292 4.305 53.108 5.670 3.330 9.000 5.365 0.360 14.725 2.021 ‐0.441 1.580

Income Tax Expense/(Benefit) 0.000 0.019 8.425 6.810 15.254 0.000 3.000 3.000 5.753 ‐5.925 2.828 0.005 0.141 0.146

Net Income/(Loss) After Tax 9.815 19.631 15.782 ‐5.608 39.620 13.130 16.753 29.883 8.766 7.590 46.239 9.915 3.799 13.714

Note: Details may not add up to totals due to rounding1 This includes trading gains/losses, fees, penalties and other operating income, among others.2 Starting 3 June 2016, the Reverse Repurchase Agreement and Special Deposit Account have been replaced by the Reverse Repurchase Facility and Overnight Deposit Facility, respectively and a Term Deposit Facility was introduced in line with the

implementation of the Interest Rate Corridor (IRC) system.3 This represents realized gains or losses from fluctuations in foreign exchange rates arising from foreign currency‐denominated transactions of the BSP.p Based on the preliminaryand unaudited BSP Financial Statements (FS).r Revised to reflect restated and audited figures for December 2018 and December 2019, respectively, based on the audited 2019 BSP FS.


2018 2019 2020

Report on Economic and Financial Developments

Documents

Transcript of Report on Economic and Financial Developments