BSP admits Maharlika will stall reaching P200B capitalization goal
MANILA, Philippines — The Bangko Sentral ng Pilipinas admitted Wednesday that the passage of the current iteration of the bills creating the Maharlika Investment Fund will delay the implementation of a 2018 law that increased the capitalization of the central bank to P200 billion from P50 billion.
“It will take a longer time for us to reach P200 billion,” BSP Deputy Governor Francisco Dakila Jr. said during the second Senate hearing on the controversial measure to establish the Maharlika fund, a proposed sovereign wealth fund.
Dakila said should the Maharlika fund be approved in its current form — which would require the BSP to remit 100% of its dividends in the first two years of its existence and then 50% thereafter — it would take around 14 years to reach the central bank’s capitalization goal.
In contrast, Dakila said it would take around half the time for the BSP to reach P200 billion in capitalization if the Maharlika fund does not pass Congress.
But he said the BSP will be able to tolerate the projected delay as he claimed that its balance sheet has improved.
But Sen. Sherwin Gatchalian noted that there has been little improvement in the BSP’s capitalization.
“The capitalization’s still P60 billion,” Gatchalian said, noting Dakila’s own admission earlier in the hearing about the BSP’s current capitalization. “The target’s still P200 billion. So where’s the improvement there?”
He also flagged the apparent turnaround of the BSP regarding the urgency of increasing its capitalization, which it campaigned for as far back as 2016 to keep up with the pace of economic growth.
“There’s a sense of urgency at that time, 2016. Now, you will lose your dividends for two years, during which it wouldn’t go towards your capitalization. Where’s your sense of urgency?” Gatchalian said.
He added, “If we vote to forgo the two years in favor of Maharlika, in effect contradicting our vote during those times.”
In January, Rep. Joey Salceda (Albay, 2nd District) floated a “re-engineered” version of the Maharlika fund which he said President Ferdinand Marcos Jr. presented during his trip to Davos, Switzerland for the World Economic Forum.
Under this version, dividends from the BSP would no longer be used to fund Maharlika, which he said would secure seed money from the securitization of around P44.33 billion in annual dividends from government corporations.
Salceda previously told Philstar.com that these proposed amendments will be introduced once the Maharlika fund bill is filed in the Senate, but the bills filed by Sen. Mark Villar and Raffy Tulfo for the creation of this sovereign wealth fund do not include these.
The creation of the Maharlika fund is among 10 priority bills that Malacañang and legislative leaders identified Monday during their meeting in Malacañang where they agreed to approve before Congress adjourns sine die on June 2.
While this may grease the legislative mill and hasten its passage in the Senate, it is not a guarantee that it will be swiftly approved where it faces stiff opposition from the two-member minority bloc.
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