Funds in the special deposit accounts (SDA) facility of the Bangko Sentral ng Pilipinas (BSP) is declining as it stood at P1.79 trillion as of June 14.
BSP data said that the P1.798-trillion SDA funds recorded from June 10 to 14 was lower than the previous week’s level of P1.817 trillion. It declined by P18.576 million.
SDA is a monetary facility instrument made available to banks for managing excess domestic liquidity in the financial system, the board noted, adding that trust departments of banks acting as trustees and trust entities are also given access to the facility.
The BSP has kept the interest rates on SDAs at 2 percent. It also reduced the SDA rate three times since January by a total of 150 basis points.
The Monetary Board also issued a memorandum limiting bank’s access to SDA facility.
“Consistent with the contractual nature of SDA placements, the BSP reiterates its intent to limit access to the SDA facility to banks and their trust departments, and trust entities, for their own account or acting as trustees,” the board stated in the memorandum.
Under the new rule signed by BSP Governor Amado Tetangco Jr., beginning January 1 next year, access by trust departments/entities to the SDA facility shall be limited to the fund management activities of trust accounts.
It added that only unit investments trust funds shall be allowed access to SDA facility, while other fiduciary business including agency accounts and investments management activities shall no longer have access to the facility.
The Monetary Board further said that trust departments or entities are not allowed to create or utilize any other trust accounts whose purpose is to merely access the SDA facility.
In addition, the board also decided that all other SDA placements of trust department/entities, such as investment management accounts, shall be reduced by at least 30 percent on or before July 31, 2013.