Double-digit rise in trust investments seen this year

MANILA, Philippines - The growth of trust investments in the country is expected to slow down this year after posting a record growth last year due to the liquid financial system brought about by the accommodative policy stance adopted by the Bangko Sentral ng Pilipinas (BSP) to cushion the impact of the global economic crisis.

Despite the slowdown, Trust Officers Association of the Philippines (TOAP) president Marvin Fausto said in an interview with reporters that the trust and investment management industry is expected to post a double-digit growth in investments this year.

He pointed out that trust investments in the Philippines surged closed to 37 percent last year due to the liquid market brought about by the BSP’s accommodative policy stance that helped release more funds into the financial system.

Trust investments reached P1.78 trillion in 2009 or P480 billion more than the P1.3 trillion registered investments in 2008.

“The increase was due to higher liquidity in the economy,” he added.

Fausto, who is also senior vice president of Banco de Oro universal bank, said improved domestic liquidity and attractiveness of trust products such as personal trust accounts, investment management accounts, retirement funds, pension funds, and unit investment trust funds (UITFs) would result in an upbeat growth in trust investments this year.

“We are coming from a high base but we still expect a strong growth of above double digits,” he added.

The country’s strong liquidity continue to help the trust and investment management industry grow at a very fast pace.

Data released by the Bangko Sentral ng Pilipinas (BSP) showed that domestic liquidity or M3 rose to P3.971 trillion as of end-December but eased to P3.811 trillion as of end-January due to the decline in the growth of the net foreign assets of the central bank.