BSP-registered foreign portfolio investments yield net outflows in August

BSP-registered foreign portfolio investmentsa  for August 2020 yielded net outflows of US$127 million resulting from the US$793 million gross outflows and US$667 million gross inflows for the month.  This is smaller than the recorded net outflows of US$453 million in July.

 

The US$667 million registered investments for the month reflected a 7.3 percent decline (or by US$53 million) compared to the US$719 million recorded for July 2020. About 84.3 percent of investments registered were in PSE-listed securities (pertaining mainly to holding firms, property companies, banks, food, beverage and tobacco companies and telecommunication firms) while the remaining 15.7 percent went to investments in Peso government securities. The United Kingdom, Singapore, the United States (US), Hong Kong and Luxembourg were the top five (5) investor countries for the month, with combined share to total at 82.6 percent.

 

Outflows for August (US$793 million) were lower compared to the level recorded for July (US$1.2 billion) by 32.3 percent.  The US received 71.5 percent of total outflows.

 

Registered FPI transactions from 1 January to 31 August 2020 yielded net outflows of US$3.9 billion resulting from the US$11.0 billion gross outflows and US$7.1 billion gross inflows for the said period.  This is larger compared to the US$1.1 billion net outflows noted for the same period last year (1 January to 31 August 2019) by brought about by uncertainties due, among others, to the impact of the COVID-19 pandemic to the global economy and financial system, and other key events earlier in the year such as geopolitical and trade tensions, and corporate governance issues involving the water concessionaires. Meanwhile, year-to-date transactions for all investments (PSE-listed securities, Peso GS, and other investments) resulted in net outflows.

 

Registration of inward foreign investments with the BSP is optional under the liberalized rules on foreign exchange transactions.  The issuance of a BSP registration document entitles the investor or his representative to buy foreign exchange from authorized agent banks and/or their subsidiary/affiliate foreign exchange corporations for repatriation of capital and remittance of earnings that accrue on the registered investment.  Without such registration, the foreign investor can still repatriate capital and remit earnings on his investment but the foreign exchange will have to be sourced outside the banking system.

 

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Refer to inward foreign investments in PSE-listed securities (PSE); Peso-denominated government securities (GS); Peso time deposits with banks with minimum tenor of 90 days; other Peso debt instruments; unit investment trust funds; and other portfolio investments such as Exchange Traded Funds and Philippine Depositary Receipts

 

 

Source: Bangko Sentral ng Pilipinas (BSP)