Why Philippine central bank is tightening rules on trust industry
New reporting rules set: BSP aims to ramp up trust industry oversight
Manila: The Bangko Sentral ng Pilipinas (BSP) seeks to strengthen its supervision of the country’s trust industry by requiring additional data reporting through a “Supplemental Data Requirement” (SDR).
A draft circular outlining the proposed rule is currently open for public comment.
Stakeholders are given until June 2 to submit feedback.
What’s being proposed?
The BSP wants trust entities — such as banks’ trust departments and independent trust companies — to submit more detailed information that goes beyond what they already report under the existing Financial Reporting Package for Trust Institutions (FRPTI).
The stated goal:
Further improve how the BSP monitors these entities
Ensure that they meet fiduciary standards,
Manage risks properly, and
Maintain adequate liquidity.
Under the Philippine law, funds held by trust entities are not covered by the Philippine Deposit Insurance Corp. (PDIC).
What is the Supplemental Data Requirement (SDR)?
The SDR is a new set of reporting requirements designed to:
Enhance regulatory oversight
Improve risk monitoring
Ensure better transparency in the trust industry
Key data points to be reported under the SDR:
Under the proposed new requirements, trust entities will be mandated to provide the following:
Number of trust accounts opened and closed per quarter
Distribution channels used to sell trust products
Client risk profiles (to better assess exposure levels)
It also requires detailed data on:
Unit Investment Trust Funds (UITFs)
Trust and agency accounts not currently covered under FRPTI.
Filing dates
The data will be submitted through BSP’s PRIME system (Prime Reporting Innovation and Monitoring Engine) and must be filed within 30 banking days after each reference quarter ends.
Timeline
A pilot run is scheduled for the June 30, 2025 reference quarter
Full quarterly submission of SDRs will be required thereafter
These will remain in place until the enhanced FRPTI is officially adopted.
The BSP is expected to issue additional technical guidelines – such as submission formats, in a separate note.
Explained: What are “trust” entities?
Under Philippine law, trust entities are financial institutions that manage assets on behalf of individuals or organisations.
In the Philippines, many started as departments within banks but have since evolved into independent or insurance-affiliated firms.
Their services include:
Wealth management,
Estate planning, and
Investment fund management.
While trust funds are not insured like bank deposits, they are still regulated by the BSP to ensure responsible asset management.
Boosting transparency
With the SDR move, BSP aims to boost transparency and oversight in the trust industry.
The new SDR will provide granular and client-specific data.
Submission will be quarterly via the PRIME system.
A pilot phase begins mid-2025, with full rollout to follow.
Public feedback on the draft circular is due June 2, 2025.
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