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Foreign Portfolio Investments Post Net Inflow in February 2010

03.12.2010

February 2010 Transactions
 
Transactions in Bangko Sentral ng Pilipinas (BSP) registered foreign portfolio investments posted a net inflow of US$139 million in February, substantially higher than  the US$199 million net outflow a year ago but slightly lower than last month’s US$170 million net inflow. Net inflows were sustained due to news on higher export earnings, inspite of jitters about the coming elections and recent sovereign debt concerns in some European countries.
 
Registration of inward foreign investments with the BSP is voluntary. It entitles the investor or his representative to buy foreign exchange from authorized agent banks or their subsidiary/affiliate foreign exchange corporations for repatriation of capital and remittance of dividends/profits/earnings that accrue on the registered investment.

On a gross basis, registered foreign portfolio investments amounted to  US$500 million, with about 74 percent going to stocks listed in the  Philippine Stock Exchange, followed by government securities (18 percent) and peso time deposits with maturity of at least 90 days (8 percent). Outflows aggregated US$362 million, and largely pertained to sales proceeds of BSP-registered foreign portfolio investments and earnings thereon that were temporarily deposited with banks (interim peso deposits or IPDs) pending subsequent reinvestment or repatriation/remittance.

Year-to-Date Flows

For the first two months of the year, transactions netted an inflow of US$309 million, a dramatic increase from the US$23 million net inflow for   the comparable period in 2009.  Registered investments of US$1.1 billion grew by 54 percent year on year.  The top five (5) investor countries consisting of the United Kingdom, the United States, Malaysia, Luxembourg and Singapore collectively contributed 83 percent of total registered investments.

Outflows, on the other hand, of US$768 million came mostly from withdrawals of IPDs (92 percent of total).

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