Philippines Central Bank Implements Stricter FX Reporting Oversight

The Bangko Sentral ng Pilipinas (BSP), the Philippines central bank, has introduced new reporting guidelines for banks' forex transactions, including penalties of up to 1 million pesos (apprx. 17k US Dollars) per violation to safeguard the peso and ensure price stability.

Announced on July 17, the BSP's Monetary Board approved Circular No. 1197, amending FX reporting regulations to enhance data accuracy and accountability among BSP-Supervised Financial Institutions (BSFIs).

The updated guidelines, effective 15 banking days post-publication with a transitory period until December 31, 2024, aim to improve the timeliness and accuracy of banks' FX transaction reports. Key amendments include defining non-compliant reports, revising monetary penalties based on entity classification, and setting maximum penalties of P1 million per transactional violation or P100,000 per day for ongoing violations.

Since 2022, the BSP has proposed higher fines to enhance compliance and protect the local currency. The rules apply to various financial entities, including big banks, digital banks, thrift banks, offshore banking units, and representative offices. Penalties range from 3,000 pesos for primary reports from universal/commercial banks to 300 pesos for representative offices.