The Bangko Sentral ng Pilipinas, or BSP, expects more issuances of corporate bonds this year as it forms measures to open up the financial market to investors with various risk appetites.

BSP Governor Eli Remolona Jr. on Monday said this year is a "risk on" period which signals more opportunities than disadvantages for raising capital.

The outlook was a result of a recent meeting by the Financial Stability Coordination Council where Remolona serves as the chairman.

"Assessing various measures, the FSCC believes that current market behavior is aligned with a "risk on" stance which will nurture more economic activity.

The FSCC also consists of the heads of the Department of Finance, Securities and Exchange Commission, Insurance Commission and Philippine Deposit Insurance Corporation.

Stable growth expected

The statements came after global institutions projected the Philippine economy to remain stable due to strong spending among consumers, relatively manageable inflation, and resilient banking industry.

"The banking system has enough space to support the increased demand for funding," Remolona said.

The BSP reported domestic liquidity grew by 8.2 percent in October last year to P16.247 trillion compared to P14.96 trillion in the same month in 2022.

Bank lending also increased by 7.1 percent year-on-year, the central bank said. 

To encourage a more active corporate bond market, Remolona said the FSCC will be focusing on tools for more accurate price and risk projections. 

"The council's long-term objective is for a much more diverse set of corporate borrowers to issue bonds, and for the risks to be actively priced while the bond remains outstanding," he said.

Remolona said the FSCC will be consulting all stakeholders in the corporate bond  market to ensure the Philippines will be a safe and more competitive investment destination.