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Copy of THE PHILIPPINE FINANCIAL SYSTEM

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Joanna Paula Ybanez

on 9 March 2016

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Transcript of Copy of THE PHILIPPINE FINANCIAL SYSTEM

THE PHILIPPINE
FINANCIAL SYSTEM

FINANCIAL SYSTEM

transfer of money between investors and borrowers
“Financial System” indicates a group of complex and closely linked institutions, agents, procedures, markets, transactions, claims and liabilities within an economy.
COMPONENTS OF FINANCIAL SYSTEM
Banks (banking sector)
Non-Bank Financial Institutions (non-bank sector)
Banking Sector
interacts directly with customers
indulges in a number of activities relating to Finance with a range of customers
deals with both internal and international customers
interest is to help in business transactions and savings/ investment activities
Non-banking sector
interacts with banks and governments
mainly concerned with the term loan needs of large enterprises
mainly concerned with the Finances of foreign companies
interest is in the stabilization of the currency
Banking sector and Non-banking sector:
WHAT'S THE DIFFERENCE?
What do you mean by the Philippine Financial system?
BANGKO SENTRAL NG PILIPINAS
Universal Banks
"Expanded Commercial Banks"
- underwriting activities
- equity investments in non- allied undertaking, and
- up to 100% equity investments in financial intermediaries
Specialized Government Banks
Development Bank of the Philippines
Thrift Banks
Savings and Mortgage Banks (SMBs)
Rural Banks and Cooperatives
These banks were designed to mobilize rural savings by accepting savings and time deposits.
Commercial Banks
These are institutions that accept deposits and allow lending essentially on short term basis.
Bank Types
Land Bank of the Philippines
Philippine Amanah Bank
Private Development Banks (PDBs)
Stock Savings and Loan Association (SSLAs)
Specialized Government Banks
These are unique government banks which are subject to the supervision and regulation by the BSP.
Development Bank of the Philippines
designed to provide long-term finance for the rehabilitation of agriculture, industry and property damaged after World War II.
Land Bank of the Philippines
It was the bank called upon to finance the acquisition by the government of landed estates for division and resale to small landholders, and the eventual purchase of the landholding by the tenant-lessee.

Philippine Amanah Bank
It was especially designed to serve the banking needs of the Muslims areas in the South.

The Thrift Banks Act 1995 provided for the establishment, operation and supervision of thrift banks to include savings and mortgage banks, private development banks, and stock savings and loan associations.

Savings and Mortgage banks
These are institutions designed to accumulate the savings of depositor. These savings are their invested in various ways to earn income through loans, interest-bearing discount, real estate investments, personal finance and home building and home development activities.
BANKING LAWS
New Central Bank Act
(R.A No. 7653)
which defines the power of the Bangko Sentral ng Pilipinas (BSP) in the administration of the monetary, banking and credit system
General Banking Act
(R.A No. 337)
which regulates the operations of the banks and other financial institutions.
Thrift Banks Act of 1995
regulates the organization and operation of rural banks; Cooperative Code of the Philippines which governs the organizations and operations of non-stock savings and loans associations
The Philippines Deposits Insurance Corporation (PIDC)
The PIDC is the official insurance corporation of the banking system. It requires insured banks to pay an assessment rate so that their deposits are insured up to P100,00 pesos per depositor.
The Securities and Exchange Commision (SEC)
issues certificate of incorporation to financial corporation
votes on and approves amendments
discharge other functions in connection with the licensing of financing companies and investment houses
supervises and regulates their specific areas of operation.

The Cooperative Development Authority (CDA)

The agency promulgates rules and regulations to govern the promotion, organization, registration and supervision of all types of cooperative banks.
NON-BANK FINANCIAL INSTITUTIONS
obtained from the public
obtained from other sources
Component Institution
1. Investment Houses
2. Financing Companies
3. Investment Companies
a. mutual funds
b. close-ended funds
4. Securities Dealers and Brokers
5. Ventures Capital Corporations
6. Pawnshop
7. Lending Investors
8. Government Non-Bank
Financial Institutions
9. Mutual Building
10. Non-stock savings and loans
associations (NSSLAs)
BSP's major operating sector
SUPERVISION AND EXAMINATION SECTOR (SES)
-conducts special examinations of banking institutions and quasi-banks including their subsidiaries and affiliates
BANKING SERVICE SECTOR (BSS)
-tracks foreign exchange transaction, external debt and government securities of the BSP
RESOURCE MANAGEMENT SECTOR (RMS)
-supervise accounting operations, information technology systems, human resources, property management and other services of BSP
The Financial System is a network of various institutions. It is an important component of the economy because it provides funds to consumers, producers and traders.
History of the Philippine Financial System?
Full transcript