The Bangko Sentral ng Pilipinas (BSP) has updated its rules to expand investment options for overseas Filipinos by exempting certain retirement funds from a non-resident ownership limit on investments in its securities.
The BSP amended regulations to allow Personal Equity and Retirement Account (PERA) Unit Investment Trust Funds (UITFs) to be exempt from the rule that previously capped non-resident ownership at 10 percent of the fund to be eligible to invest in BSP securities.
BSP securities are debt instruments issued by the central bank that non-residents are typically not allowed to own.
UITFs, which are pooled funds managed by banks and trust companies and regulated by the BSP, were previously allowed to invest in these securities only if non-residents owned no more than 10 percent of the fund.
Nine out of 13 PERA-UITFs currently exceed the 10 percent non-resident ownership limit, which has barred them from investing in BSP securities. The change will allow these funds to diversify their investment portfolios.
The BSP said its move is part of its ongoing effort to promote financial health and help Filipinos, both at home and abroad, build secure and sustainable retirement savings.
It also aims to develop the country’s private pension system and strengthen domestic capital markets, it said.
UITFs are similar to mutual funds, which are managed by investment companies and regulated by the Securities and Exchange Commission (SEC), in that they pool funds from individual investors to create diversified portfolios, even for those investing small amounts.
