Under Republic Act number 7653 as amended by RA No. 11211
in February 2019
the BSP's authority to issue negotiable
securities for open market operations
was restored.
Benefits of the BSP Securities
The issuance of the BSP
Securities provides us an additional
monetary tool for liquidity management
under the Interest Rate Corridor system
that is more flexible and market-friendly.
The BSP Securities will support
the development of domestic bond market.
What are the key features of the BSP
Securities?
Both BSP Bills and BSP Bonds
will be offered with the BSP Bills to be
offered at the onset.  Market preferences
and prevailing liquidity conditions will
be considered in deciding on the tenors
of BSP Securities to offer. Close
coordination with the Bureau of the
Treasury or BTr will also ensure that
the tenors of BSP Securities are
consistent and meet the markets demand.
 Initially the BSP Securities will be
offered to our existing counterparties
in the Term Deposit Facility
specifically universal and commercial
banks, thrift banks and non-banks with
quasi banking functions.  Going forward a
broader participation may be considered
to increase monetary policy efficiency.
The issuance shall be done via auction.
The BSP will pre-announce the auction
schedule to facilitate planning by
market participants. The tenor and volume
of issuance will be based on liquidity
forecasts and market conditions.
How will we issue the BSP Securities?
First, the auction of BSP Securities will
be conducted using the BSP Monetary
Operation System or MOS. Second,  through
the MOS, the BSP's Open Market Operations
Auction Sub-Committee will determine the
allotment of securities.  Third, the
National Registry of Scripless Securities
or NRoSS of the BTr shall serve as
the registry of successfully awarded BSP
Securities. Fourth, the secondary
market trading of BSP Securities will be
done on the trading platform for the
Philippine Dealing and Exchange
Corporation.
The linking of the BSP's MOS
and the BTr's NRoSS is an important step
toward the issuance of negotiable BSP
Securities. The MOS-NRoSS linkage will
facilitate the seamless process of the
auction of BSP Securities, and the
registry and recording of these
securities to enable primary market
issuance and secondary market trading.
The issuance of BSP Securities is
expected to strengthen the transmission
of our monetary policy stance to the
rest of the economy. It is a major step
toward fulfilling our commitment to
promote and maintain price stability for
the benefit of all Filipinos.
