By Melissa Luz T. Lopez, Senior Reporter
THE BANGKO SENTRAL ng Pilipinas (BSP) saw its bottom line surge during the first semester, boosted by sizeable gains from currency trading at a time of a weaker peso.
The central bank posted a P29.45 billion net income as of end-June, nearly five times the P6.55 billion it made during the comparable period in 2017.
Latest available data showed that revenue collections rose by 13.6% to hit P37.08 billion, coming from P32.65 billion which the BSP raked in a year ago.
Broken down, interest income reached P35.88 billion, nearly a third higher than the amount shored up in January-June 2017.
This more than offset a plunge in miscellaneous income from fees and penalties, which slid to P1.19 billion this year from P5.16 billion previously.
On the other hand, the BSP was able to streamline its operations and cut costs to P29.12 billion, 17.7% lower than the P35.4 billion in expenses incurred a year ago.
Income drawn from its core operations stood at P7.95 billion, a turnaround from the P2.75-billion loss posted as of June 2017.
However, gains from foreign exchange trading gave a substantial boost to the BSP’s bottom line. The central bank generated P21.51 billion from trading gains during the first six months, more than double the P9.31 billion realized a year prior.
The BSP conducts “tactical intervention” during the daily peso-dollar trading, in line with its mandate of price and financial stability. The central bank often taps reserve money to buy or sell more dollars in order to temper any sharp swings that may cause a sudden appreciation or depreciation of the peso.
The peso averaged P53.0476 versus the greenback in June, versus the P49.8501 exchange rate last year. The local unit has been trading above P53 during the month.
A weaker peso actually spelled gains for the BSP, given that a big chunk of its assets and investments are expressed in dollars.
Adjustments to the BSP’s open market operations took effect in June 2016, where the central bank introduced the weekly term deposit auctions and pay interest rates to banks for parking their excess funds under one-week, two-week and month-long deposits.
The BSP is on track to remain in the black for the third straight year, and could even post a banner year this 2018. The BSP has recovered from six straight years of a net loss after it posted a P17.81 billion profit in 2016, followed by a P23.51 billion net income in 2017.
Earlier this month, the House of Representatives approved a measure that would infuse P150 billion in additional capital for the BSP, alongside other structural changes to the central bank charter.
House Bill 7742 also seeks to broaden the BSP’s mandate to include regulating payment systems. The central bank will likewise be allowed to set up its own reserves against foreign exchange transactions.
The measure is awaiting second reading approval in the Senate.