The Bangko Sentral ng Pilipinas (BSP) has issued an advisory Thursday, Sept. 21, reminding banks of the guidelines on the registration of private sector foreign currency loans and borrowings to ensure the central bank can adequately capture these foreign exchange (FX) transactions.

In a circular signed on Sept. 14 by BSP Senior Assistant Governor Iluminada T. Sicat and released on Thursday, the BSP re-issued the guidelines on how to submit documents relating to FX transactions.

The BSP advisory included an online link to the guidelines on filling out forms for the loan borrowing profile and the application for the registration of private sector FX loans.

Sicat said this “serves as a reference for private sector firms submitting ‘Notice’ to the BSP and application for registration of foreign loans/borrowings.”

She added that the guidelines provide descriptions of the details requested in each field of the annexes in the guidelines.

“Applicants are highly encouraged to carefully review these guidelines to ensure that their submissions are properly filled out in accordance with the requirements of the FX Manual,” said Sicat.

Every Sept. 30 of each year, the BSP receives all private and public sector foreign borrowing plans for review.

These foreign borrowing plans are for the fourth quarter 2023 and for the full-year 2024 period.

The BSP is mandated to review all foreign borrowing plans for external debt management and under the rules of the country’s FX transactions and policies.

To be reviewed are both the public and private sector’s medium- and long-term foreign loans or borrowings from non-residents, including offshore issuances of debt instruments, and their plans to issue onshore debt instruments that require settlement in foreign currency.

The BSP makes it mandatory to submit foreign borrowing plans to monitor the magnitude and timing of foreign financing requirements which would help them in their capital flows projections and its implications on the economy.

From the submissions of both the private and public sector of their planned foreign loans, the BSP could estimate what it called an “indicative funding requirements” every year.

As of end-June this year, the total outstanding external debt grew 9.5 percent year-on-year to $117.918 billion from $107.692 billion same time in 2022.

The public sector external debt dropped to $74.5 billion in the second quarter of 2023 from the previous quarter’s $75.2 billion. Meanwhile, private sector debt also declined to $43.4 billion from $43.6 billion end-March.