The Banker, an international monthly banking, finance, and business magazine owned by the Financial Times, has named Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno “Global Central Banker of the Year 2022.”
In a statement issued on Wednesday, the BSP stated that the recognition of Diokno among central bankers from around the world is a first for the Philippines. In addition to the global title, Diokno was named “Asia-Pacific Central Banker of the Year 2022.”
Diokno’s actions were best exemplified by his rapid-fire rate cuts in 2020 in an attempt to spur credit activity in the Philippines’ spending-dependent economy, and as fiscal response to the pandemic was deemed insufficient. Since an aggressive easing episode that ended in November 2020, the BSP has kept its key rate unchanged at 2%.
Apart from lowering borrowing costs to historic lows, the BSP under Diokno also reduced banks’ reserve requirements, increased the single borrowers’ limit, and granted the national government credit lines to help fund its pandemic response.
Those efforts finally paid off when bank lending reversed an eight-month decline in August 2021, giving banks more leeway to lend to consumers and businesses.
“I am truly honored to be named The Banker’s Global Central Banker of the Year. This award recognizes the effort we at the BSP have put forth over this past year — amid extraordinary challenges,” Diokno stressed in the statement.
According to the publication, Diokno assisted the Philippines recover from the Covid-19 outbreak while also pushing his banking system modernization plan forward. With global inflation having an impact, Diokno has taken the stance of keeping interest rates at 2% for as long as possible in order to maintain stability, it stated.
“Believing that the current environment is transitory, he decided to hold on to an accommodative monetary policy to support the economy,” The Banker noted.
According to the report, Diokno has proposed a cash-lite economy to encourage the migration to digital payments, bringing the Philippines in line with its neighbors.
“Tied to this, he is supporting local payment providers through the use of the national ‘QR PH’ standard for QR code payments, which are increasing and on track to reach the target of 50 percent of all payments by 2023,” according to the magazine.
“Through his (Diokno) thoughtful foresight, the banking sector was able to successfully navigate and surpass the adverse impact of the crisis allowing the country to achieve positive growth in 2021 despite the continuing threat of the COVID-19 health crisis,” the Bankers Association of the Philippines said in their message to Diokno.