Foreign Portfolio Flows Improve in February

Manila—(PHStocks)—Bangko Sentral ng Pilipinas (BSP)—Registered investments for February 2014 reached $1.5 billion, reflecting a 16.7 percent growth from the $1.3 billion posted last month. Year-on-year, however, registered investments were lower by 29.6 percent, reflecting investor’s initial reaction to the tapering of the quantitative easing (QE) program in the United States (US) starting January this year.

Investments during the month consisted mainly of PSE-listed securities (88.3 percent) and Peso GS (11.7 percent). For PSE-listed securities, the main beneficiaries were: holding firms, banks, property companies, food, beverage and tobacco firms, and retail companies.

Outflows for the month dropped by 40.7 percent to $1.9 billion from $3.1 billion last month as investors positively reacted to reports of favorable 2013 corporate earnings. While transactions resulted in overall net outflows of $361 million, this was significantly lower than the $1.8 billion recorded the previous month when the tapering of the US QE program began. Year-on-year, however, this was a reversal from the $212 million net inflows. Transactions in PSE-listed securities yielded net inflows of $148 million, while Peso GS transactions resulted in net outflows of $509 million.

The US, the United Kingdom, Singapore, Luxembourg, and Malaysia were the top five (5) investor countries for the month with combined share to total of  77.7 percent, while the United States continued to be the main destination of outflows receiving 92.2 percent of total.

Registration of inward foreign investments with the Bangko Sentral ng Pilipinas (BSP) is voluntary.  It 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.