The following is a write-up from the president of the Bank of the Philippine Islands about the current global financial crisis and how it will affect the Philippines.
Fellow Unibankers,
Attached please find a piece that I was supposed to write for an outside publication - unfortunately, I cannot submit it as the ending is perpetually changing.
What I thought to be a gathering storm to hit in the first quarter of 2009 has hit our beaches yesterday - the Philippine Stock Exchange had its highest (12. 27 %) drop in history a single day, and the Peso Dollar exchange rate is creeping back from around P 41: $ 1 to almost P 50 : $1. Like other markets in the region, the PSEI has dropped 50% ytd, and people are getting nervous.
It has now become a Fundamentals versus Emotion issue - Philippine economic fundamentals relative to the world and even Asia are good, and the banking system is stable, but Bloomberg 24×7 Television, local media reports, and cocktail party talk make people fear the worst, and then expect the worst.
