BSP-registered foreign portfolio investments yield net outflows in March 2022

Bangko Sentral ng Pilipinas (BSP)-registered foreign portfolio investments (FPIs)^[i] in March 2022 yielded net outflows of US$305 million resulting from the US$1.6 billion gross outflows and US$1.3 billion gross inflows for the month.

This a reversal from the net inflows of US$274 million recorded in February 2022.

The US$1.3 billion registered investments for March 2022 reflected an increase of 35.3 percent (or by US$333 million) compared to the US$945 million recorded in February 2022.

Majority of investments (or 86.7 percent) registered were in PSE-listed securities [investments mainly in: (a) holding firms; (b) property; (c) banks; (d) food, beverage and tobacco; and (e) transportation services] while the remaining 13.3 percent went to investments in Peso government securities.

The top five (5) investor countries for the month were the United Kingdom, United States (US), Luxembourg, Singapore and Hong Kong with combined share to total at 78.4 percent.

The US$1.6 billion gross outflows for the month were higher by 136.1 percent (or by US$912 million) than the US$670 million recorded in February 2022.  The US received 80.3 percent of total remittances.

Year-on-year, registered investments in March 2022 increased by 55.0 percent (or by US$453 million) from the US$824 million recorded in March 2021.

Similarly, gross outflows were larger by 15.9 percent (or by US$218 million) than the outflows recorded a year ago (US$1.4 billion). The US$305 million net outflows in March 2022 is smaller compared to the US$541 million net outflows recorded for the same period a year ago.

Year-to-date transactions (1 January to 31 March 2022) for BSP-registered FPIs yielded net outflows of US$16 million, smaller by 96.6 percent (or by US$467 million) than the US$483 million net outflows noted for the same period last year (1 January to 31 March 2021).

Registration of inward foreign investments with the BSP is optional under the rules on foreign exchange transactions. It is required only if the investor or its representative will purchase foreign exchange from authorized agent banks and/or their subsidiary/affiliate foreign exchange corporations for repatriation of capital and remittance of earnings that accrue on the registered investment.

Without such registration, the foreign investor can still repatriate capital and remit earnings on its investment but the foreign exchange will have to be sourced outside the banking system.

^[i] Refer to inward foreign investments in PSE-listed securities (PSE); Peso-denominated government securities (GS); Peso time deposits with banks with minimum tenor of 90 days; other Peso debt instruments; unit investment trust funds; and other portfolio investments such as Exchange Traded Funds and Philippine Depositary Receipts