Sun Life exec likes PHL's chances of credit rating upgrade this year

January 30, 2013 5:24pm


The Philippines has a good chance of receiving a credit rating upgrade this year, thanks to a stable political environment, a lower fiscal deficit and low interest rates, an executive of global financial services firm Sun Life Financial said on Wednesday.

"There's a lot of confidence in the country, even in the political side. Business, consumer and even foreign confidence are also high," said Michael Manuel, managing director of Sun Life's Asia Investments section.

"We expect the credit rating upgrade this year as the Philippines was rated only one notch lower than investment grade by the three credit rating agencies—Fitch, Moody's and Standard and Poor's," he said.

Bangko Sentral ng Pilipinas has maintained key policy interest rates at 3.50 percent for overnight borrowing and 5.50 percent for the overnight lending in expectation of low inflation.

"Today's [low-interest rate] environment is conducive for stronger economic growth. We expect interest rates to remain low going forward," said Manuel.

Sun Life Asset Management president Valerie Pama said she also expects a bullish market after the BSP cut interest rates on special deposit accounts to three percent to rationalize the SDA facility consistent with international central banking practices.

"We expect more liquidity into the market and more investments to come," she said. — BM, GMA News