Eastwest, BSP and CitiGroup Share Insights in Ayala-UPSE Economic Forum

Ayala-UPSE economic forum

From left are: Citigroup - Hong Kong Managing Director of Asia Pacific Economic and Market Analysis Dr. Johanna Dee Chua; BSP Monetary Board Member Dr. Felipe Medalla; and EastWest President and CEO Antonio Moncupa, Jr.


EastWest Bank President and CEO Antonio C. Moncupa, Jr. was a panelist in the economic forum organized by Ayala Corporation and the UP School of Economics. Entitled “Philippines: Will the Financial Stability be at Risk?”, the forum was held at Hotel InterContinental Manila.

The speaker, Dr. Johanna Dee Chua, Managing Director of Asia Pacific Economic and Market Analysis at Citigroup in Hong Kong, said that the Philippine banking system can withstand pressures as Philippine banks are extremely liquid and have stable funding base from core retail deposits. She added that Asian banks, in general, are among the best capitalized in the world and that the Asian Financial Crisis in 1997 has taught banks to be vigilant.

Mr. Moncupa concurred and further validated Dr. Chua’s insights and said that the Philippines is not anywhere near financial instability, being one of the earliest to implement Basel III. He also said that Philippine banks strongly adhere to regulations and are on the more conservative side, owing mainly to the vigilance of the BSP.

The Philippines is in a secular growth path and is now outpacing Asia’s loan growth. It is far from bubble territory because leverage, which causes financial instability, is too low.

Dr. Felipe Medalla, Monetary Board Member of the Bangko Sentral ng Pilipinas, also said that Philippine banks have learned a lot from the Asian Financial Crisis. Unlike US banks whose ownership is very diverse, most Philippine banks are majority-owned by a single family. Thus, owners can always disapprove if their managers are taking too much risk. He also reminded though that the Philippines should never be complacent when economic fundamentals are stable as complacency is the root of instability.

The quarterly AC-UPSE Economic Forum aims to publicly disseminate applied economic research to help identify stimuli for sustained economic growth in the Philippines.