Philippines to Order Banks to Undergo Property Stress Test

The Philippine central bank is firming up steps to avert a property bubble, including requiring banks to undergo a stress test, Deputy Governor Nestor Espenilla said.

“Real estate exposure historically has been the trigger of problems in many banking systems. It’s quite natural for regulators including BSP to be particularly wary of this,” Espenilla, 55, said in an interview in his office in Manila today. “We’re implementing a risk-based type supervision,” he added, without specifying a timeframe for its introduction.