The Securities and Exchange Commission (SEC) is ramping up efforts to expand the government securities (GS) repurchase agreement (Repo) market to deepen the country’s capital market.
The SEC said it is looking to expand the range of participants in the Repo market beyond the GS eligible dealers by including nonbank financial institutions.
“The Repo market is envisioned to support the market-making activities of government securities dealers in the country. Expanding this market provides us with another opportunity to improve liquidity, manage short-term funding, and boost overall market activity,” SEC chairman Emilio Aquino said.
Since assuming direct market oversight in 2020, the SEC has worked to stabilize Repo market operations and enforce compliance among market participants.
The SEC supported the call of industry groups in 2024 for the expansion of the documentary stamp tax exemption for all derivative market players.
This resulted in the issuance of Revenue Memorandum Circular (RMC) No. 125-2024, amending RMC No. 95-2017 which governed the tax treatment of GS repo transactions under the Global Master Repurchase Agreement (GMRA) and allowed for the initial introduction of a functioning Repo Market in the Philippines.
The SEC, in collaboration with the Bankers Association of the Philippines and the Asian Development Bank, organized a GMRA-based Repo workshop attended by over 600 participants from Feb. 19 to 21.
The workshop aimed to equip stakeholders with the necessary knowledge and tools to implement the GMRA framework effectively.
The SEC is also currently working on identifying the most appropriate Self-Regulatory Organization for the Philippine Repo market to ensure its long-term viability.
Meanwhile, the SEC said it recently opened a new office in Ilagan City, supporting the strong economic growth and the rise of new businesses in the Cagayan Valley region.
The new SEC office is located at the ground floor of The Capital Arena, Barangay Alibagu, Ilagan City, Isabela.
The Cagayan Valley region is one of three remaining regions without an SEC extension office, aside from Region IV-B (MIMAROPA) and the Bangsamoro Autonomous Region in Muslim Mindanao.
The region had a total of 6,154 SEC-registered corporations and partnerships as of December 2024, with the Isabela province accounting for almost half of the registered entities at 2,955. The province of Isabela is also home to two special economic zones.
