FATF gray list exit to boost entry of foreign investments

The country's exit from the Financial Action Task Force (FATF)'s gray list is expected to strengthen foreign investor confidence, enhance correspondent banking relationships and streamline cross-border transactions.

- By KEISHA TA-ASAN

Banking leaders in the Philippines have expressed their optimism about the positive impact of the gray list exit on the country's financial sector and economy.

HSBC Philippines president and CEO Sandeep Uppal welcomed the development, emphasizing that exiting the gray list would facilitate faster and lower-cost cross-border transactions, reduce compliance burdens and enhance financial transparency.

"This is a much welcome development for HSBC Philippines, both for our internal and external stakeholders, as we deal with a lot of cross-border transactions," he told The STAR.

"Banking processes will become faster and smoother, hence customer experience will be better," he said.

Security Bank president and CEO Sanjiv Vohra also told The STAR that the Philippines' removal from the gray list sends a strong signal of financial stability to international investors.

"For businesses, this means renewed trust from foreign investors, who now view the Philippines as a secure and stable destination for capital. We can anticipate increased foreign direct investments, bigger remittance inflows, lower transaction costs and a more competitive market for international partnerships," he said.

The FATF gray list includes jurisdictions that require increased monitoring due to strategic deficiencies in their anti-money laundering and counter-terrorism financing (AML-CFT) measures.

The Philippines had been on the list due to concerns about its financial oversight and regulatory frameworks. Exiting the list signifies that the country has made significant progress in strengthening its AML/CFT regime.

Paul Favila, CEO and country head at Citi Philippines, expressed great satisfaction with the country's removal from the gray list, calling it a highly anticipated development.