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Foreign Portfolio Investments Grow in March

04.11.2013

Portfolio investments registered in March amounted to US$2.3 billion, higher by 10.1 percent than the US$2.1 billion figure last month in response to news about robust corporate earnings, the relaxation of rules on foreign ownership under a new SEC draft, and the recent upgrade by Fitch Ratings of the country’s credit rating to investment grade. Year-to-date registered investments reached US$7.3 billion, surpassing the US$4.1 billion level in 2012 by 79.1 percent as investor optimism was buoyed by positive economic developments in the country.

Capital inflows went to PSE-listed securities (US$2.0 billion or 84.2 percent), Peso GS (US$351 million or 15.0 percent) and Peso time deposits (US$18 million or 0.8 percent). For PSE-listed securities, the main beneficiaries were holding firms (US$510 million), property companies (US$454 million), banks (US$333 million), telecommunication firms (US$185 million), and food, beverage and tobacco companies (US$183 million).

Outflows, on the other hand, increased to US$2.7 billion in March from US$1.9 billion in February, resulting in an overall net outflow of US$395 million. This was due mainly to profit taking as well as continuing concerns about the euro zone. In contrast, net inflows were recorded last month (US$212 million) and a year ago (US$184 million). Year-to-date net inflows, however, more than doubled from US$464 million last year to US$1.1 billion in 2013.

Transactions in March for Peso GS and peso time deposits yielded net inflows of US$77 million and US$18 million, respectively, while for PSE-listed securities, Unit Investment Trust Funds (UITFs), and money market instruments, net outflows were noted at US$483 million, US$5 million, and US$2 million, respectively. 

The United Kingdom, the United States, Hong Kong, Singapore, and Luxembourg were the top five (5) investor countries for the month, whose combined shares accounted for 88.5 percent of total inflows.  The United States continued to be the main beneficiary of outflows from investments.
 
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 dividends/profits/earnings that accrue on the registered investment.

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