The Bangko Sentral ng Pilipinas (BSP), which is maintaining about P200 billion worth of currency buffer stock, produced an adequate supply of banknotes and coins in 2023 as per its programmed inventory.
The BSP continues to provide insurance against uncertainties and shocks when it comes to currency supply. This is assured by maintaining a currency buffer stock equivalent to three months’ worth of banknotes and one month’s worth of coins.
“As of end-2023, the total banknote inventory of the BSP was equivalent to 2.9 months of the economy’s banknote requirements, slightly below the required currency buffer stock level of three months. Meanwhile, total coin inventory remained sufficient to service the currency requirements of the economy during the same period,” said the BSP.
Based on a report, the BSP’s currency production deliveries reached P781.6 billion worth of banknotes or about 1.9 billion pieces last year, and another P10.3 billion worth of coins or 1.8 billion pieces.
The currency production increased by 0.9 percent year-on-year for banknotes and 46.4 percent for coins. “The production deliveries complemented the (BSP’s) existing inventory of physical currency to service the demand of the economy,” said the BSP.
Last year, the BSP shipped P421.3 billion worth of banknotes and coins to its regional offices and branches (ROBs), about 2.1 percent lower than the value of currencies shipped to the ROBs in 2022.
The frequency of currency shipments also dropped by 5.8 percent, with a total of 665 completed shipments via land, air, and sea in 2023, it added.
The report also noted that “cancellation of flights due to technical malfunctions, scheduled preventive maintenance of aircraft, and weather-related conditions led to lower frequency and value of currency shipments.”
From April 2022 to December 2023, the BSP said it has completed the programmed delivery of 500 million pieces of P1,000 polymer banknotes, which were subsequently issued for circulation.
The BSP’s overall banknote issuances to its ROBs amounted to P814.6 billion or 1.9 billion pieces in 2023.
The central bank said that from this total, 48.9 percent in value and 50.6 percent in volume were issued to service withdrawals of authorized agent banks in Metro Manila.
Meanwhile, the aggregate coin issuances to ROBs went up by 43.4 percent in value and 27.6 percent in volume.
In terms of banknote and coin deposits in ROBs, both value and volume recorded increases of 11.7 percent and 7.1 percent, respectively, noted the BSP. “The expansion was driven by banks’ deposits of unfit and fit banknotes,” it said.
Banks’ deposits of fit coins increased by 76.9 percent in value and 34 percent in volume in 2023.
“On the other hand, total banknote and coin retirement in ROBs rose by 4.4 percent in volume and 4.7 percent in value in 2023. This naturally followed the increase in banks’ unfit banknote deposits, which were eventually retired,” said the BSP.
The BSP services the country’s currency requirements by doing the following: strategic scheduling and adoption of more efficient modes of currency shipments; a buffer stock to meet currency demand or potential delay in currency delivery to the regions; servicing the withdrawals of banks with new and fit banknotes and coins, in accordance with their denominational requests; and reviewing and updating of currency operational procedures, processes, and practices, aimed at improving operational efficiency and internal controls.
At the moment, the BSP prints banknotes and mint coins at its six-hectare East Avenue, Quezon City Security Plant Complex (SPC), built since the 1970s.
To modernize banknotes printing, the BSP will develop a P25-billion 31.2-hectare new Currency Production Facility (CPF) in New Clark City in Capas, Tarlac. It has completed the design phase in 2023 and is set to bid out the contract for the general contractor.