Six banks to be punished for speculating on Philippine peso
The Central Bank of the Philippines is to punish five foreign banks and a local bank for speculating on the embattled peso, local newspapers reported Tuesday, August 22.
The central bank governor, Rafael Buenaventura, confirmed in a radio interview Tuesday that his office had discovered "violations" among several banks' foreign exchange transactions but did not say how many and declined to identify them.
Local newspapers, quoting an official of the central bank, had identified the foreign banks but Buenaventura said: "That's clear speculation on the part of the news reports.
"Normally, we do not disclose that," he said.
"Definitely there are violations. What we are looking into is the gravity of the violations," Buenaventura said in an interview on DZMM Radio.
The banks would be issued a "strongly worded" warning and slapped with a fine of up to 30,000 pesos ($670) per transaction, the official was quoted as saying by the local press.
The banks were alleged to have been instrumental in dragging down the peso in May, June and July when the currency plunged to a 30-month low of 45.15 against the dollar.
The peso had plunged by about 10 percent so far this year. It was trading slightly higher at 44.492 against the dollar early Tuesday from 44.96 a day earlier.
The central bank had prepared a report to the Monetary Board detailing the foreign exchange violations by the six banks, the newspapers said.
"If deliberately done, then we will throw the book at them. But to be fair, we will have to first look into it," Buenaventura said. — (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)