By all accounts, the Y2K changeover came to pass without incident. The Philippine financial system emerged from the event relatively free of serious computer malfunctions. No major difficulties were reported for transactions involving both individual and corporate accounts, and the public was able to enjoy continued access to their deposits in the critical hours of the Y2K changeover. The absence of major changeover problems may be attributed in part to the combined efforts of the banking and financial community as well as to the various measures implemented by the Bangko Sentral.
The public has already begun to put their deposits back into the system, and banks continue to enjoy an ample supply of liquid funds. Cash deposits of banks with the BSP have increased by as much as p4 billion on the first banking day of the new year compared to the daily average of less than p1 billion in preceding days. Repeated assurances by the Bangko Sentral and the banking community on Y2K preparedness and compliance levels did much to dispel depositors’ fears in the weeks leading to the event itself.
In addition, the Bangko Sentral worked to complement the banks’ Y2K readiness by providing temporary backup assistance in case of an unusual surge in liquidity demand. Among other things, this included the establishment of a special repurchase facility and an emergency year 2000 loan facility. Use of these loan facilities, however, has been minimal. None of the banks made use of the special repurchase facility, and only three (3) thrift banks and seven (7) rural banks availed themselves of the special Y2K facility as of 30 December 1999.
These various measures helped maintain ample liquidity in the financial system throughout the Y2K event, as indicated by the P13.4 billion in total bids for the weekly treasury bill auction on 20 December. Moreover, banks continue to place large amounts of funds with the BSP through the BSP’s reverse repurchase window. The Y2K measures also prevented large withdrawals by the public. Most major banks have reported that withdrawals remained at normal levels during the event.
The relatively smooth changeover notwithstanding, the Bangko Sentral will remain vigilant in the months to come and will continue to coordinate with the banking sector in monitoring the financial system for any computer-related problems.