By Lee C. Chipongian

One of a global first, a senior Bangko Sentral ng Pilipinas (BSP) official said that supervisory processes and systems’ digital transformation will be implemented next year, further enhancing the technology-enabled BSP’s monitoring of banks, and part of its institution-wide reorganization.

“The BSP is set to modernize our internal processes through the adoption of next-generation systems and technology-enabled solutions,” according to BSP Deputy Governor Chuchi G. Fonacier.

This would include “forward-looking supervisory models” using “pioneering technology” in a prudent way.

Fonacier also revealed that BSP’s reorganization continues and her sector in particular, the Financial Supervision Sector (FSS), will “undergo a major restructuring” with the consolidation of the BSP’s Examination and Central Point of Contact Department into a Financial Supervision Department.

Fonacier said the central bank will communicate these changes to banks in the next few months but she reassures the industry that BSP reorganization will maintain the “safety and soundness of the banking system.”

The second round of BSP reorganization was approved last month while BSP Governor Nestor A. Espenilla Jr. was on an extended six-week medical leave. He returned to work on November 16.

In the meantime, Fonacier said that in 2019, they will roll out and complete the supervisory technology or Suptech projects that includes the Financial Institution (FI) portal, the Application Programming Interface (API) system and the automated complaint-handling system.

“The FI portal is an online, secured, web-based facility designed to streamline the BSP’s regulatory compliance process. Once operational, banks may readily submit reports through the facility, instead of via e-mail, receive prompt feedback and exchange correspondences with the BSP on reporting matters,” she said in a recent banking event.

The API system, in the meantime, will change the central bank’s regulatory reports process and will minimize “risks related to human intervention and e-mail transmission of reports” at less costs for the banks.

“The BSP’s automated complaint-handling system or chat bot, on the other hand, will allow financial customers to submit their concerns via SMS, Viber or web portal. Through this system, customer voice is amplified and analytical capacity of the BSP improved,” said Foancier.

The BSP official announced last month that they are coming up with several rules relating to Suptech and Regtech or regulatory technology.

These reforms include the adoption of the Surveillance Loop and Early Intervention Framework which according to a central bank report, involves the development of a banking sector resilience index and a vulnerability index. These are meant to help banks brace for potential vulnerabilities, said the BSP.

Last May, the BSP announced that they have reorganized and added one more sector.

There are now four major sectors despite that BSP only has three deputy governors under the New Central Bank Act (Republic Act 7653). Three of the sectors are headed by deputy governors and one sector – which had been beset by controversies years ago – continue to be handled by an assistant governor.

The new sectors – renamed and subjected to reshuffling of directors – are the Monetary and Economics Sector, the Currency Management Sector, the Resource Management Sector and Fonacier’s soon to be renamed FSS.