BSP-registered foreign portfolio investments yield net outflows in September 2021

Bangko Sentral ng Pilipinas (BSP)-registered foreign portfolio investments (FPIs)^[i] in September 2021 yielded net outflows of US$24 million resulting from the US$1.21 billion gross outflows and US$1.19 billion gross inflows for the month. This is a reversal from the net inflows of US$12 million recorded in August 2021.

The US$1.19 billion registered investments for September 2021 reflected a 47.3 percent (or by US$381 million) increase compared to the US$807 million recorded in August 2021.  Majority of investments (or 74.3 percent) registered were in PSE-listed securities (investments mainly in holding firms, property, telecommunication, food, beverage and tobacco and utilities) while the remaining 25.7 percent went to investments in Peso government securities. The United Kingdom, United States (US), Switzerland, Hong Kong and Singapore were the top five (5) investor countries for the month with combined share to total at 84.4 percent.

The US$1.21 billion gross outflows for the month were higher by 52.4 percent (or by US$417 million) than the US$795 million recorded in August 2021.  The US received 70.8 percent of total outflows.

Year-on-year, registered investments rose by 100.1 percent from the US$594 million recorded in September 2020.  Similarly, gross outflows were higher than the outflows recorded a year ago (US$1.1 billion) by 11.5 percent. It may be noted that the US$24 million net outflows are lower than the US$494 million net outflows recorded for the same period a year ago.

Transactions for BSP-registered FPIs from 1 January to 30 September 2021 yielded net outflows of US$459 million, lower than the US$4.4 billion net outflows noted for the same period last year.

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