Philippines Cuts RRR for Big Banks to 9.5%

The central bank of the Philippines lowered its cash reserve ratio by 250bps to 9.5 percent on June 8th, 2023.

The bank also reduced the RRR for digital banks to 6%, thrift banks to 2%, and rural and cooperative banks to 1%.

The cut will be effective from June 30 and will apply to the local currency deposits and deposit substitute liabilities of banks and non-bank financial institutions with quasi-banking functions.

The purpose of reducing reserve ratios is to align with the expiration of alternative modes of compliance with reserve requirements by the end of June 2023 and thereby ensure stable domestic liquidity and credit conditions.

The bank noted that the lower reserve requirements do not signify any change in the monetary policy.