RP banks will survive crisis - fund managers

The Fund Managers Association of the Philippines (FMAP) is optimistic that the Philippine banking system will survive the financial meltdown in the United States given the industry’s minimal exposure to the distressed institutions in the US.

FMAP, which has 44 member institutions and 100 investment professionals, urged the investment community to remain calm.

“We, the Fund Managers Association of the Philippines believe that the impact on the local banking industry would be minimal. We therefore enjoin the whole investment community to exercise sobriety in this time of uncertainty as we continue to remain optimistic of the long-term prospect of the Philippine financial markets,” FMAP said in a position paper yesterday.

The group said that the Philippines cannot be totally immune to the negative impact of the crisis but noted that the effects on the country would be minimal.

“Though volatility may persist, we are confident in the sound macro fundamentals of the Philippine economy and the resiliency of the Philippine financial markets,” FMAP said.

The group echoed the earlier statement of the Bangko Sentral ng Pilipinas (BSP) that Philippine banks’ exposure to the distressed institutions comprised only an insignificant share to the overall Philippine banking capitalization. FMAP is an organization of local equity and fixed income investment management professionals with combined total assets under management of around P2 trillion of discretionary funds.

These funds are in the trust, insurance, state-sponsored pensions, and mutual fund industries. 

RP banks... From C-1

FMAP aims to foster the development of the capital and financial markets by contributing to the enhancement and promotion of the professional standards of the fund management industry.

The US financial meltdown, brought about the billions of losses from the credit crunch in its mortgage market, has led to the collapse of big institutions. Investment banks Merrill Lynch and Lehman Brothers have gone bankrupt while US insurer American International Group also revealed that it was having liquidity problems.