With the theme “Is the Philippine Banking Sector Ready If a Magnitude 7.2 Earthquake Hits Metro Manila?”, the Bangko Sentral ng Pilipinas (BSP) hosted a dialogue with over a hundred participants from the banking sector, financial market players and telecommunications sector on 16 June 2015 at the Executive Business Center, BSP. The event is in line with the BSP’s long-range efforts and initiatives to enhance existing business continuity management (BCM) culture and develop a whole-of-industry approach that upholds disaster resilience of the banking sector.
Dr. Renato U. Solidum, Jr., Director of the Philippine Institute of Volcanology and Seismology (Phivolcs) graced the event as the keynote speaker and presented a comprehensive report on various earthquake-related hazards and risk scenarios for Metro Manila and their implications to the banking sector. The event also featured a panel discussion by representatives from the Bankers Association of the Philippines (BAP), Chamber of Thrift Banks (CTB), PLDT/Smart Communications, Inc., Globe Telecom, Inc. and Business Continuity Office of the BSP which tackled the sector’s state of readiness and explore measures to achieve earthquake resilience.
The BSP has always been at the forefront of ensuring disaster resilience of the banking sector through the issuance of robust regulatory framework on BCM as well as ongoing onsite and offsite supervision of BCM processes of BSP-supervised financial institutions (BSFIs). As early as 2001, the BSP required BSFIs to prepare comprehensive business continuity plans (BCPs) intended to minimize disruption of core banking services and financial losses, resume critical operations within the shortest possible time, uphold consumer protection and avoid systemic impact within the financial services industry.
To further boost disaster resilience of the banking sector, the BSP recently exposed draft guidelines on BCM to the industry which aim to enhance BCM processes of BSP-supervised financial institutions (BSFIs). Said guidelines include strategies and processes to address risks and hazards arising from catastrophic events such as a major earthquake in Metro Manila.
While BSFIs are already prepared on an institutional level to withstand a major earthquake, the BSP embarked on adopting a more holistic approach to disaster recovery that would address interdependencies and linkages across the sector as well as support the over-arching objectives of the government to reduce the impact of such disaster to infrastructure, economy and the affected communities.
Thus, the BSP is already laying the groundwork for the establishment of working groups to develop industry-level earthquake preparedness and crisis management plans which shall include protocols that can be quickly activated given a disaster scenario. The BSP shall continue its efforts towards earthquake resilience for the banking sector and engage its stakeholders in exploring viable solutions that will promote effective response and quick resumption of critical services essential in maintaining public trust and confidence in the financial system.