The central bank announced another 1% cut in bank reserves on Thursday, May 24, marking the second adjustment this year as the regulator aims to reduce lending costs in the Philippines.
In a statement, the Monetary Board announced that the reserve requirement ratio (RRR) imposed on universal and commercial banks will be trimmed to 18% effective June 1.
“The move continues the BSP’s gradual and phased reduction in reserve requirement ratios that commenced in March 2018,” the Bangko Sentral ng Pilipinas (BSP) said in a statement on Thursday.
This follows a cut of the similar magnitude announced on Feb. 15 which took effect March 2.
BSP Governor Nestor A. Espenilla, Jr. has committed to reducing the ultra-high reserve standard on big banks as he assumed his post in July last year, saying that it would keep the Philippines competitive relative to its Asian peers. — Melissa Luz T. Lopez