The Bangko Sentral ng Pilipinas (BSP) said Wednesday it approved new guidelines to enhance the operational resilience of supervised financial institutions (BSFIs).
The “Guidelines on Operational Resilience” aims to strengthen BSFIs’ ability to manage and mitigate the impact of disruptions on their critical operations, given frequent natural disasters and fast-paced advancements in technology.
It said the guidelines also help ensure that financial services remain available despite prolonged business interruptions, such as those experienced during the COVID-19 pandemic.
This is in line with the BSP’s thrust to foster continuous delivery of financial services to support inclusive and sustainable economic growth.
“The new guidelines are crucial given the increasing threats to business operations. They complement our previous efforts to strengthen the financial resilience of supervised institutions. Operational resilience ensures the overall safety and soundness of both individual institutions and the entire financial system,” BSP Governor Eli Remolona Jr. said.
The guidelines require BSFIs to integrate operational resilience with existing governance structures and related risk management processes, such as operational risk management, business continuity management, cyber resilience, third-party risk management, and recovery plans. The guidelines also consider the “Principles for Operational Resilience” issued by the Basel Committee on Banking Supervision.
It said that in establishing an operational resilience framework, BSFIs should identify critical operations, which, if disrupted, would cause material harm to their customers, their business and/or the financial system.
They should also set tolerance levels for disruption or how much disruption they can handle while still delivering critical operations. BSFIs should ensure that they remain within their established limits, the BSP said.
The guidelines will be implemented in phases to ensure smooth transition and implementation. BSFIs should submit to the BSP an accomplished self-assessment questionnaire within one year from the circular’s effectivity. This will guide them in identifying areas for improvement and preparing action plans for their operational resilience frameworks.
