Duterte picks Espenilla as Tetangco’s successor

Photo of career central banker Nestor Espenilla, Jr. from CNN Philippines

By Ma. Stella F. Arnaldo  @akosistellaBM / Special to the BusinessMirror

NESTOR “Nesting” ESPENILLA JR. is the new Bangko Sentral ng Pilipinas  (BSP) governor, taking over from Amando M. Tetangco Jr., who ends his second term at the post on July 3, 2017, and after 42 years of central banking.

Finance Secretary Carlos G. Dominguez III made the confirmation of President Duterte’s choice via text message to the BusinessMirror, and indicated this would mean the administration’s push toward the further liberalization of the financial sector.

“Yes, Nesting Espenilla is the new BSP governor,”  Dominguez said. He described Duterte’s pick as “a very wise choice, after a thorough evaluation of the future needs of the country and of all the candidates.”  Espenilla heads the Supervision and Examination Sector of the central monetary authority.

The finance chief added, “We were fortunate that Governor Tetangco carefully trained his potential successors.” Tetangco had earlier made known that he preferred to have an “insider” to take his place as BSP chief. Aside from Espenilla, the other front-runner for the post was BSP Deputy Governor Diwa  C. Guinigundo, who oversees the Monetary Stability Sector.

Other candidates included former Trade Secretary and Monetary Board member Peter Favila and East-West Bank President Antonio Moncupa.

In choosing Espenilla, Dominguez said, “We need to continue to strengthen our financial system, as well as to further open up the sector.” Espenilla has always been an advocate of liberalizing the banking sector, with an eye for instance, on the industry offering more financial tools and instruments that would expand its growth, as well as widening the investment choices of depositors.

Espenilla could not be reached for comment as of press time.

For his part, Tetangco, said, “We thank the President for his decision. The choice of an insider in the person of Deputy Governor Espenilla ensures the continuity of policy and thought process in the BSP.  DG Espenilla is well respected in the banking community and highly regarded by other central banks and financial regulators both here and abroad. He is also well supported by the BSP family.  I am confident that with him at the helm, the BSP will continue to be a pillar of support to the economy, that should remain among the top performing economies in the world.”

Espenilla  Jr. has been with the BSP since 1981 and has worked in Economic Research, International Operations, and in the Office of the Governor. He was seconded to the IMF from 1990 to 1992.

He earned a Bachelor of Science degree in Business Economics and a master’s degree in Business Administration from the University of the Philippines, as well as a Masters of Science degree in policy science from the Graduate Institute of Policy Science in Tokyo, Japan.

Based on the central bank’s charter, the BSP governor can serve only two terms of six years each. Tetangco was first appointed in 2005 by then-President Gloria Macapagal-Arroyo and was reappointed by former President Benigno S. Aquino III in 2011.

With about 35 years of central banking experience, Espenilla’s name has been linked to several banking regulation that transformed the local lending industry into one of the most resilient in recent history.

Among his major efforts include the structural reforms in the financial system to promote efficiency, safety, transparency and universal accessibility.

Espenilla also spearheaded that upgrade in the country’s regulatory framework and bank-supervision approach to be consistent with Basel Core Principles for Effective Bank Supervision, as well as the Basel Capital Accord, and fully incorporated standards for the prevention of money-laundering and terrorist financing, promotion of good corporate governance in banks and protection of financial consumers.

Concurrently, Espenilla is the chairman for the Executive Meeting of East Asia Pacific Central Banks Working Group on Banking Supervision, chairman on the Basel Consultative Group Workstream on Financial Inclusion and the BSP’s representative in the Global Policy Forum for Financial Inclusion of the G-20.

With Rea Cu, Bianca Cuaresma