By Lee Chipongian, Genalyn Kabiling, and Charissa Luci-Atienza
The Bangko Sentral ng Pilipinas (BSP) has announced that the Monetary Board, after a late night meeting on Saturday, has named Deputy Governor Ma. Almasara Cyd Tuaño-Amador as officer-in-charge (OIC) of the BSP after the passing of Governor Nestor A. Espenilla Jr.
Bangko Sentral ng Pilipinas (BSP) Governor and Chairman of the Monetary Board Nestor “Nesting” Aldave Espenilla Jr. (MANILA BULLETIN)
“In a special meeting held on the same day, the Monetary Board designated (deputy governor) Tuaño-Amador as BSP OIC effective immediately until such time that President Rodrigo Duterte shall have designated an OIC or appointed a successor,” a statement from the BSP Corporate Affairs Office said.
Espenilla, 60, has “peacefully passed away on February 23 surrounded by members of his family. (He) had been undergoing treatment for cancer for more than a year,” said the BSP.
The details of the wake and formal viewing will be announced later, the BSP added.
BSP Deputy Governor Diwa C. Guinigundo said Espenilla was an innovative manager. “He was not satisfied with what was available; he wanted to evolve with a monetary framework that could make certain central banking more relevant and responsive to the challenges of the times,” he said.
BSP Deputy Governor Chuchi G. Fonacier, who succeeded Espenilla as head of the BSP’s Supervision and Examination Sector (SES), is reassuring the public that the BSP mandate will continue to be delivered. “Gov. Espenilla championed financial inclusion and allowed technological innovation to flourish in the financial services industry,” she said.
Three of the six Monetary Board members expressed their support for Tuaño-Amador as OIC, including former deputy governor Juan de Zuñiga Jr., now Monetary Board member.
“Even in this sad moment, I can assure that there is institutional stability in the BSP … and there is continuity in our management and operations (until President Duterte) appoints an OIC or (Espenilla’s) successor,” said de Zuñiga.
Monetary Board members Felipe M. Medalla and Bruce J. Tolentino both said continuity is important for the central bank amidst what would be a highly speculative market in the next days or weeks.
“We will remain focused on achieving the goals set by Gov. Espenilla and the Monetary Board. OIC Cyd Amador knows both the basic principles and implementing strategies,” said Medalla. He said the “cumulative 175 basis points hike in the policy rate and our more than ample international reserves put us in a very strong position to manage whatever happens to markets in the coming days.”
Tolentino, in the meantime, said “the entire BSP structure are fully behind (the OIC) in continuing the agenda and programs of the late Gov. Espenilla.”
Industry observers said the designation of Tuaño-Amador is a neutral one since deputy governors Fonacier and Diwa C. Guinigundo are strong contenders to succeed Espenilla as the BSP’s fifth governor under the New Central Bank Act of 1993, which was recently amended.
Both Fonacier and Tuaño-Amador were appointed deputy governors in July 2017, the same time Espenilla took his post as the BSP chief. Guinigundo has been deputy governor and head of the Monetary and Stability Sector since 2005.
Espenilla, a veteran of nearly four decades with the Bangko Sentral ng Pilipinas (BSP), took over as governor in July 2017 but was diagnosed with tongue cancer four months later and was on leave intermittently during 2018.
Espenilla, who was appointed by President Duterte in May ,2017 and sworn-in as the BSP's fourth governor in July of the same year, was one of key officials that put together the updated and revised New Central Bank Act which was recently signed into law as Republic Act No. 11211 (“An Act Amending Republic Act No. 7653, Otherwise Known as the ‘New Central Bank Act’, and for Other Purposes”). The BSP has been working on and pushing for its charter amendments for decades.
“During his tenure, the amendments to the BSP charter were finally passed, strengthening the capability of the central bank to deliver its mandate to promote price and financial stability and to foster a safe, efficient and inclusive payment system,” said the BSP.
Espenilla has served the BSP for 38 years, or from 1981 until his death. He was appointed deputy governor of the BSP’s supervision and examination sector (SES) in 2005. As SES head, he was in charge of banking supervision, capital market development, credit policy, and financial inclusion.
Espenilla has been on an intermittent medical leave since September last year, up until in January when he went to the US to consult with cancer specialists. He announced his tongue cancer diagnosis on February 25, 2018, one year to his passing. At the time, he said the cancer was first detected as early as November 2017, a mere four months after his appointment as BSP governor.
During his cancer treatment, Espenilla had speaking limitations and mostly was communicating via electronic or virtual means to the Monetary Board which he chaired, and to the BSP senior officials and staff. Before he left for the US last month, he has said that he was hoping a second opinion will shed more light on his earlier cancer diagnosis. He has said then that he had no plans for an early retirement and prepared to “fight it out” until his cancer became manageable.
Espenilla was known for his monetary policy clout and expertise in banking supervision, driving reforms in the sector that included improving financial transparency and overhauling mismanaged lenders.
He joined the BSP in 1981 as a debt analyst while still at university before moving into the bank supervision area. He was named assistant governor in 2002, then deputy governor three years later.
The central bank credited Espenilla with advancing its reform agenda and leading a move to digitize retail payments to broaden financial inclusively.
Tributes, condolences
Malacañang mourns the passing of BSP Governor Nestor Espenilla Jr., thanking the banking official for his “great service to the nation.”
“We are saddened to learn Saturday night the untimely demise of Bangko Sentral ng Pilipinas (BSP) Governor Nestor Espenilla Jr.,” Presidential Spokesman Salvador Panelo said in a statement.
“As we express our condolences to the family, friends, colleagues and loved ones of Governor Espenilla, we express our gratitude to the man once in charge of disciplining banks for his complete devotion to his work and great service to the nation,” he added.
Panelo remembered Espenilla’s rise to the BSP leadership as well his contributions to the improvement of the country’s banking system.
He said Espenilla, a UP magna cum laude graduate, was best remembered by ordinary Juan de la Cruz for making financial services closer to Filipinos who transact mostly using non-bank channels.
“He pioneered a National Retail Payment System and introduced InstaPay, an electronic fund transfer system, and PESONet, an automated clearing house, which saw the Philippines' gradual shift from cash and check-based payments to electronic means,” he said. “Rest in peace, Governor Nesting,” he added.
Members of the Duterte administration’s economic team likewise expressed sadness over Espenilla’s passing.
Budget chief Benjamin E. Diokno said he is proud to have known the BSP governor, who, like himself, was a product of the UP School of Economics. “He is an esteemed member of the Duterte economic team (and) we will miss his rigorous analysis of domestic and international economic developments.”
NEDA director-general Ernesto M. Pernia said Espenilla was “a big loss to BSP and the country.”
"His legacy in BSP of sound banking policies for the protection of our financial system and the economy shall live on," Senator Richard Gordon said on Twitter.
Great loss
House leaders described yesterday as a “great loss" to the banking industry the late BSP Governor and Chairman of the Monetary Board Nestor Espenilla Jr.
Eastern Samar Rep. Ben Evardone, chairman of the House Committee on Public Information, and Leyte Rep. Henry Ong, chairman of the House Committee on Banks and Financial Intermediaries, extended sympathies to the bereaved family of Espenilla, who died of tongue cancer.
Evardone, former chairman of the House Committee on Banks and Financial Intermediaries, said Espenilla was one of his partners in crafting the new law that amended the Central Bank Act and the Payment Systems Law, among other initiatives and reforms in the financial sector.
"The passing away of BSP governor Espenilla is a great loss to the banking community and our country. He was a sincere public servant and a brilliant economist," he said. Ong said the entire Bangko Sentral family and the banking community have lost "a good, hardworking, and devoted leader."
“As chairman of the House committee on banks and financial intermediaries, I have had the pleasure and blessing of working with him and his BSP colleagues,” he said.
“Governor Espenilla was wise, tireless, and determined in his push for banking reforms and updating legislation,” Ong said.
The Economic Journalists Association of the Philippines said the next BSP governor will have big shoes to fill, especially Espenilla’s unfinished work of expanding financial inclusion in the country. “(He was an) exemplary public servant who heeded the call of duty even when he was grappling with his own health issues. (But) even as we mourn, we urge President Duterte to ease market uncertainties by promptly filling the void with someone just as suitable and committed to the BSP’s mandate of price and financial stability – one who can hit the ground running and ensure policy continuity,” said journalists’ group.
Espenilla is survived by his wife, Maria Teresita Festin Espenilla, daughter, Jacqueline Joyce and son-in-law, Ben Baltazar, sons Nikko Nestor and Leonardo Nestor and grandchild, Zev Eron. (With Reuters)