Parliament approves increase of bond program to P55bn
Asset Managers Repatriate P8 Billion
Serame emphasises the importance of supporting pension asset owners
The latest data from the Non-Bank Financial Institutions Regulatory Authority (NBFIRA) indicates that as at December 2023, a total of P8.84 billion has been repatriated back into the country, according to Minister of Finance Peggy Serame.
This aligns with the provisions of the Retirement Funds Act (2022), which mandate asset owners and managers to progressively decrease pensioners’ offshore investment allocations while concurrently increasing their onshore allocations over a 5-year phased plan. The objective is to achieve a 50/50 split by 2027.
Based on available data, onshore investments currently stand at approximately 42%. Minister Serame stated yesterday in parliament that the phased repatriation of pension assets will persist, with an inflow of P0.5 billion anticipated for the year 2024. This process will continue with an annual inflow of P4.17 billion thereafter until the culmination of 2027.
“These projections are based on the assumption that a stable working environment will prevail,” Serame said.
The government aims to secure a significant portion of pension funds, aiming to raise approximately P13 billion this year. Serame emphasised the importance of government support for pension asset owners and managers by offering investment instruments to safeguard future pension obligations to the greatest extent possible.
The P30 billion bond note program which was increased from P15 billion in 2020 has been fully utilised. Serame said the February 2024 monthly auction of Government securities resulted in total debt outstanding on Government securities amounting to P30 billion, comprising P6 billion in outstanding Treasury Bills and P24 billion in Government Bonds, signifying the attainment of the Bond Issuance Programme limit.
Parliament has approved an increase in the ceiling for the Government Bond Issuance Programme, raising the limit from the current P30 billion to P55 billion. Observers highlight that the government aims to reach the new cap by 2027. Serame unveiled an expansionary budget last month, allocating a significant portion of the funding towards infrastructure development.
Comentarios