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Thursday, April 18, 2024

BSP okays lower minimum opening account for investment management activities

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THE Bangko Sentral ng Pilipinas (BSP) approved on Wednesday the reduction of the minimum opening account for investment management activities.

In a statement, the BSP said the Monetary Board made the policy amendment in an effort to expand the investment opportunities of the public by reaching markets that may not have been able to open investment management accounts (IMAs) due to the high entry requirement.

Previously, the minimum opening account value for IMAs was set at P1 million. The amendment lowered this to any amount, subject to a floor of P100,000.

“Through our forthcoming issuance, we hope that more savers will transition into investors,” stated Governor Benjamin Diokno. “This is in line with the goal to make financial services more accessible to the public.”

The BSP also reduced the required investment of each IMA in a commingled fund from P1 million to P100,000.

“This is aimed at increasing the participation of retail investors in the securities markets through IMAs. Furthermore, commingled funds can now invest in a wider range of financial assets, which includes exchange-traded equities and fixed income securities and commercial papers registered with the Securities and Exchange Commission and securities issued by banks incorporated in the Philippines,” the BSP said.

Corporate accounts are also now allowed to participate in commingled funds.

The BSP said the new amendments are expected to support the growth of the trust industry while underscoring the importance of consumer protection.

“We aim to strike a balance between liberalization and prudence. There are more changes in trust regulations in the pipeline and we hope that the industry will welcome these changes as well,” Diokno said in a statement.

Trust entities are required to fully disclose to clients the risks, including the risk that assets in a commingled fund may not, at times, be easily divested at favorable market prices.

Read full article on BusinessMirror

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