Foreign Portfolio Investments Post Net Inflows in February 2016

Manila—(PHStocks)—Bangko Sentral ng Pilipinas (BSP)—Foreign portfolio investment transactions for February 2016 yielded overall net inflows of US$58 million, a reversal from the US$130 million net outflows in January, albeit much lower than the US$1.2 billion net inflows posted a year ago.

Registered foreign portfolio investments for the month amounted to US$1.1 billion, reflecting a 30.3 percent growth from the US$820 million recorded in January 2016. The figure, however, is much lower compared to the US$2.6 billion recorded a year ago when investments were fueled by renewed investor interest in Peso GS as well as shares offered by two (2) holdings firms.

Outflows for the month grew by 6.4 percent from the January figure due to profit taking, lingering concerns on the slowdown of the Chinese economy, and oil price uncertainties. Year-on-year, however, outflows declined by 25.6 percent.

About 77.1 percent of investments registered in February were in PSE-listed securities (mainly pertaining to holding firms; food, beverage and tobacco firms; property companies; banks; and telecommunication companies), while the 22.9 percent balance were in Peso GS. Transactions in PSE-listed securities resulted in net outflows of US$57 million, while those for Peso GS yielded net inflows of US$115 million.

The United Kingdom, Singapore, the United States, Luxembourg, and Belgium were the top five investor countries for the month, with combined share to total of 79.5 percent. The United States continued to be the main destination of outflows, receiving 89.6 percent of total.

Registration of inward foreign investments with the Bangko Sentral ng Pilipinas (BSP) is voluntary under the liberalized rules on foreign exchange transactions.  The issuance of a BSP registration document entitles the investor or his representative to buy 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 his investment but the foreign exchange will have to be sourced outside the banking system.

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