Lecture: Philippine Financial System

Flashcards covering structure, institutions, and functions of the Philippine financial system.

What are the three main sectors of the Philippine Financial System?

BSP (Bangko Sentral ng Pilipinas), Financial Institutions, and Financial Markets.

What does BSP stand for and what are its main roles?

Bangko Sentral ng Pilipinas; central monetary authority that regulates banks and most non-bank financial institutions; maintains price stability, supervises monetary policy, and manages currency.

What are Banking Institutions and what do they do?

They accept deposits and provide loans; examples include universal/commercial banks, thrift banks, rural banks, and cooperative banks.

What are Non-Bank Financial Institutions (NBFIs) and what do they do?

Do not accept traditional deposits but provide financial services like investments, insurance, lending; examples include insurance companies, pawnshops, investment houses.

What are Financial Markets and examples?

Platforms for buying and selling financial instruments; examples: Philippine Stock Exchange (PSE) and Philippine Dealing System (PDS).

In simple terms, what is a key difference in primary function between Banks and NBFIs?

Banks: accept deposits and provide loans; NBFIs: provide financial services such as investments, lending, and insurance.

Are NBFIs deposit-taking institutions?

Generally no; most NBFIs do not take traditional deposits.

Who supervises Banks and NBFIs?

Banks are supervised by BSP; NBFIs: some are supervised by BSP, others by other agencies (e.g., Insurance Commission).

Name three universal/commercial banks in the Philippines.

BDO Unibank, Metrobank, BPI.

Name two thrift banks.

China Bank Savings, Sterling Bank of Asia.

Name two rural banks.

One Network Bank, Cantilan Bank.

Name two cooperative banks.

Bangko Kabayan, Cooperative Bank of Cotabato.

Name two insurance companies in the Philippines.

Sun Life Philippines, Philam Life.

Name two pawnshops.

Tambunting, Cebuana Lhuillier.

Name two investment houses.

First Metro Investment Corp., ATR Asset Management.

Name two lending companies.

Home Credit Philippines, Tala.

Name three Government Financial Institutions (NBFIs).

SSS, GSIS, Pag-IBIG Fund.

What are the main functions of Banks?

Mobilization of Savings, Credit Creation, Payment System, Monetary Policy Implementation.

What does Mobilization of Savings mean for banks?

Collect deposits from the public.

What does Credit Creation mean for banks?

Provide loans to individuals and businesses.

What does Payment System mean for banks?

Facilitate financial transactions via checks, ATMs, e-banking.

What does Monetary Policy Implementation mean for banks?

Channels for implementing BSP policies.

What services do Insurance Companies provide under NBFIs?

Risk protection through life and non-life insurance.

What do Investment Houses do under NBFIs?

Facilitate capital raising, underwriting of securities.

What do Pawnshops offer under NBFIs?

Short-term collateralized loans.

What do Lending Companies do under NBFIs?

Provide credit to individuals/entities without deposit functions.

What do Mutual Funds/Asset Managers do under NBFIs?

Pool funds for investment in securities.

What do Government Financial Institutions provide under NBFIs?

Offer social security, housing, and retirement benefits.

What is the function of Financial Markets?

Platforms for buying and selling financial instruments (stocks, bonds, etc.).

What are the examples of markets/platforms mentioned?

Philippine Stock Exchange (PSE) and Philippine Dealing System (PDS).