Bangko Sentral wants P30B capital balance from govt paid under 2013 budget

The Bangko Sentral ng Pilipinas (BSP) said Monday it asked Department of Budget and Management (DBM) to earmark P30 billion under the proposed P2-trillion national budget for 2013 to cover its capital requirement.

 

BSP Deputy Governor Diwa Guinigundo told reporters Monday on the sidelines of a Senate hearing on the proposed national budget that capital support from the national government will allow the central bank, which incurred nearly P34 billion in losses last year, to help better manage the economy.

 

The 1993 BSP charter which replaced the old Central Bank of the Philippines provided for a P50-billion capital infusion from the national government by the time the new Bangko Sentral started operations.

 

But budget problems kept the national government from fulfilling its obligation to capitalize the new central bank, and was able give the Bangko Sentral only P20 billion or which P10 billion was allocated only last year.

 

“We are making representations to the national government to include this in the 2013 national budget,” Guinigundo said. 

 

The Budget Department is not sure it could respond positively to Bangko Sentral’s request. 

 

A Budget and Management official DBM said the capitalization balance for the Bangko Sentral might not be prioritized under the proposed 2013 budget because of expenditure requirements to pump-prime the economy. 

Last year, Bangko Sentral incurred losses last year as it supported the peso against the US dollar to keep the foreign exchange stable.

 

Extreme cases of volatility in the currency market, whether appreciation or depreciation, should be avoided because its negative impact on the economy, according to the Bangko Sentral.

 

Guinigundo said Bangko Sentral is also pushing to amend its profit-sharing scheme with the national government to 50-50 from the 75 percent-50 percent now in place.

 

The proposal is embodied in a proposed bill seeking to amend the Bangko Sentral charter. — VS, GMA News