Outgoing BSP chief and new Finance Secretary Benjamin Diokno said that he is confident the new governor of Bangko Sentral ng Pilipinas (BSP), Felipe Medalla, will be able to continue the reforms he has implemented under his previous leadership.
These reforms include a rapid shift to digitalization and other measures that had kept the BSP “agile” and “innovative” amid a pandemic-induced crisis and other challenges the country’s financial system faced.
In a speech delivered during the BSP’s 29th anniversary and turnover ceremony, Diokno recounted the time of uncertainties he faced at the height of the COVID-19 pandemic as BSP governor, and how the institution was able to provide a sense of confidence and predictability for the country’s financial services industry during this period.
“We have gone through a crisis like no other, with no emergency response playbook to which we could refer but we kept our eyes on the ball. We remained agile and innovative. We boosted market confidence. We implemented extraordinary liquidity measures,” he said. What the BSP did was incentivize lending and helped facilitate the Filipinos’ access to more financial services.
Diokno added that during those trying times, “the BSP was able to ensure the continuity of much-needed financial services by providing financial relief and remaining sensitive to the needs of our fellow Filipinos. Even amidst the pandemic, it has remained business as usual for banks, money changers, and other BSP-supervised institutions.”
The BSP also worked closely with other agencies and stakeholders in getting financial reforms, such as the Financial Institutions Strategic Transfer Act and the Financial Products and Services Consumer Protection Act passed in Congress to provide relief to pandemic-hit sectors and safeguard consumers from unethical and fraudulent financial schemes.
Diokno also cited the BSP’s hand in the approval of the Gold Law, the Philippine Identification System Act, the Islamic Banking Law, and the amendments to the BSP charter prior to the pandemic. He said the BSP acted prudently in issuing monetary policies and expanded opportunities to boost digital payments and financial inclusion among Filipinos.
“We have kept a patient hand on our monetary policy levers in the face of rising inflation to allow our economic recovery to gain a stronger foothold,” Diokno said.
“Our banking sector remains sound and stable, the result of good corporate governance and appropriate risk management practices, as well as sound banking sector regulations and a robust supervisory framework,” he beamed.
Acknowledging his confidence in the new BSP Governor, Diokno said he is certain that the central bank’s Digital Payments Transformation Roadmap will make significant strides under Medalla’s leadership.
“There are many more improvements in store for us and for the Filipino people. You and I have so much to offer in the service of our country regardless of what hat we wear,” Diokno said.
“I am confident that with the leadership of your new team captain, Governor Medalla, and the Monetary Board, you will continue to deliver game-changing reforms and bring the BSP even closer to the Filipino people,” he added.
A seasoned economist takes over BSP post
A member of the BSP’s Monetary Board since July 2011, Felipe Medalla is a seasoned economist who once served as the Socioeconomic Planning Secretary and Director-General of the National Economic and Development Authority (NEDA) from 1998 to 2001, during the administration of former President Joseph Estrada.
Medalla also holds a Ph.D. in economics and served as Dean of the University of the Philippines School of Economics as well as Vice President for Planning and Finance of UP System. He has also written various papers, including one about the effects of economic policies on poverty as well as the problems in the measurement of Philippine economic growth, among others.
As Medalla takes over the helm of the Bangko Sentral ng Pilipinas (BSP), a number of pundits are saying that he was a good choice. One of them is retired COMELEC Commissioner Rowena Guanzon, who lauded Medalla’s appointment by sharing this in her Twitter post, “Felipe Medalla was my Prof in UP School of Economics. Good choice. I can imagine him in leather sandals in the late 70s.”
Medalla, 72, will start work on July 1 and will serve out the rest of Diokno’s term, which ends in July 2023.