Portal Login | Search
Announcements June 26, 2023

BAP launches Dollar-Peso Cross Currency Swap market

In pursuit of its commitment to market development, the Bankers Association of the Philippines (BAP) launches the dollar-peso cross currency swap (USDPHP CCS) market. This initiative spearheaded by the BAP Open Market Committee enables its members to utilize hedging instruments critical to financial institutions and in response to the needs and requirements of their customers to better manage foreign exchange and interest rate risks.


The BAP Open Market Committee, with the strong support of the Money Market Association of the Philippine and ACI Philippines, ensures that the USDPHP CCS market is guided by the rules and regulations of the Bangko Sentral ng Pilipinas as well as the adoption of the ISDA Master Agreement and Foreign Exchange Global Code.


Market makers in the dollar-peso cross currency swap market include BDO, BPI, Metrobank, PNB, Security Bank, Citibank, DB, HSBC, ING Bank, JP Morgan, and Standard Chartered Bank while China Bank, RCBC, Robinsons Bank, Union Bank, ANZ, Mizuho and MUFG have signed up as regular participants. Voice broker participants in this market include Amstel, GFI, Tradition and Tullet Prebon.


A cross currency swap is a transaction between two authorized parties that involves an exchange of principal amounts and interest payments in one currency for principal and interest payments in another currency at an agreed upon exchange rate and at an agreed schedule. The USDPHP CCS involves a Philippines peso fixed rate and a US dollar floating swap with standard tenors of 1 year, 2 years, 3 years, 4 years, 7 years and 10 years and will use US dollar Secured Overnight Financing Rate or SOFR as the floating rate benchmark for the US dollar leg.


The USDPHP CSS market is supported by Bloomberg, a globally recognized trading platform provider for various financial products. The USDPHP CCS is traded in Bloomberg’s FIQ<GO>.