Chief Justice Gesmundo: At the Core of a Prosperous Economy Lies the Rule of Law
May 27, 2023
Chief Justice Alexander G. Gesmundo has underscored the importance of banking laws in nation-building, saying that at the core of a prosperous economy lies the rule of law—the foundation of societal order and stability.
Speaking at the launching ceremony of the Banking Laws of the Philippines Annotated yesterday, May 26, 2023, at the Bangko Sentral ng Pilipinas (BSP) Main Office in Manila, Chief Justice Gesmundo emphasized that consistency and predictability in judicial interpretation play a crucial role in building confidence and certainty within the financial system.
He said: “When laws and regulations are consistently applied and interpreted, businesses can anticipate the legal outcomes of their actions, allowing for prudent decision-making and risk assessment. The predictability of legal outcomes enables banks to navigate regulatory frameworks, assess risks accurately, and make informed lending decisions.” The Chief Justice remarked that in turn, this “facilitates the flow of capital, supports investment, and fosters the growth of the banking sector, ultimately driving economic development.”
“Indeed, at the core of a prosperous economy lies the rule of law—the foundation of societal order and stability,” stressed Chief Justice Gesmundo, adding that the rule of law “provides a robust legal framework that governs economic transactions, ensures the enforcement of contracts, and safeguards the rights and interests of all stakeholders” and “sets forth a level playing field, creating an environment where businesses can operate with confidence, investors can allocate capital with certainty, and individuals can engage in economic activities without fear of arbitrary actions or undue influence.”
Chief Justice Gesmundo said that banking laws and regulations have evolved to recognize both the increase in Filipino participation in the banking practice, as well as the growing demands of globalization. He noted that these banking laws “lay down the parameters within which banks and financial institutions may operate, and dictate minimum capital requirements, risk management standards, and governance frameworks which govern their behavior.”
“The importance of our banking laws cannot be overstated. To begin with, our banking laws instill in us the sense of trust and confidence in our financial institutions, assuring both individuals and businesses that their hard-earned resources are protected and nurtured.” The Chief Justice added that these laws “cultivate an environment of transparency and accountability. By promoting prudent banking practices and imposing governance measures, they enable financial institutions to weather economic downturns and mitigate systemic risks, and contribute to the overall stability of our financial system.”
He said that banking laws create an environment that enables financial institutions to provide accessible and affordable financial services to individuals, businesses, and communities which, in turn, “empower rural communities and agricultural households by ensuring equal access to financial services and programs, ultimately improving the welfare of communities and driving the growth and development of our economy.”
Expounding on the contributions of the country’s banking laws to national security, Chief Justice Gesmundo pointed out that banking laws serve as a shield against corrupt forces that seek to undermine the foundations of the economy within the intricate web of financial transactions and institutions. “And, in the ever-evolving landscape of the financial world, banking laws play a vital role in combatting illicit activities, such as money laundering and terrorism,” he added.
Likewise, he underscored that banking laws “ensure that our financial institutions are resilient, trustworthy, and ready to participate in the global stage. In so doing, we attract foreign investments, foster international partnerships, and position the Philippines as a beacon of stability and growth in the global community.”
The Chief Justice also took the opportunity to share with the banking community the Strategic Plan for Judicial Innovations 2022-2027 (SPJI), the Court’s blueprint of action anchored on four guiding principles—Timely and Fair Justice; Transparent and Accountable Justice; Equal and Inclusive Justic; and Technologically Adaptive Management—all geared towards the achievement of three outcomes: Efficiency, Innovation, and Access.
Sharing its thrust of a technology-driven Judiciary, the Chief said under the outcome of Innovation, the Judiciary will shift and run all its adjudicative and administrative processes to an automated platform using the most appropriate and secure technologies, including artificial intelligence, for legal research and court operations.
He disclosed that the Supreme Court has been allowing the conduct of all court proceedings through videoconferencing, and that the Judiciary has likewise launched the Judiciary Electronic Payment Solution (JEPS) as its ePayment platform of legal fees and other collection, for which the Court has partnered with UnionBank of the Philippines, GCash and GrabPay as payment channels. The Chief Justice also shared that the Supreme Court is currently reviewing and revising the Rules of Court and that it is drafting rules with regard to the The Anti-Terrorism Act of 2020, in complement to the Court’s recent decision on the matter.
“All these will be capped by a compilation of all the Rules on Pleadings, Practice and Procedure. Definitely, your new book, Banking Laws of the Philippines Annotated, will be a welcome supplement to this compilation.
The Chief Justice concluded by urging everyone to view the BSP’s Banking Laws of the Philippines Annotated not merely as a collection of laws and regulations, but to regard it as the embodiment of Filipinos’ aspiration for social justice, economic stability, and national progress. “As co-workers in government, let this book prod us to nurture a culture of integrity and transparency, and may this book unite us all Filipinos to lay the foundation for a thriving and progressive Philippines,” he said.
In his response, BSP Governor and Anti-Money Laundering Council (AMLC) Chairperson Felipe M. Medalla stated that the speech of the Chief Justice, which delved into the Judiciary’s 5-year strategic plan, should be a required reading for all BSP personnel.
Also present during the book launch were retired Chief Justice Diosdado M. Peralta and retired Chief Justice Teresita J. Leonardo-de Castro.
Prior to launched, Chief Justice Gesmundo was received by BSP officials led by Governor Medalla and Senior Assistant Governor and General Counsel Elmore O. Capule, and AMLC Executive Director Matthew M. David during an Appreciation Meeting. The BSP officials expressed their gratitude to the Supreme Court for its support in the initiatives of the AMLC, particularly in strengthening the observance of the anti-money laundering statute in the recently launched Code of Professional Responsibility and Accountability. (Courtesy of the Supreme Court Public Information Office)
Chief Justice Alexander G. Gesmundo and Bangko Sentral ng Pilipinas (BSP) Governor and Monetary Board Chairperson Felipe M. Medalla display their copies of the Banking Laws of the Philippines Annotated during its launch at the BSP Main Office in Malate on Friday, May 26, 2023. (Courtesy of the Supreme Court Public Information Office)
Chief Justice Alexander G. Gesmundo receives a token from Bangko Sentral ng Pilipinas (BSP) Governor and Anti-Money Laundering Council (AMLC) Chairperson Felipe M. Medalla during an Appreciation Meeting at the BSP office in Malate, Manila on May 26, 2023. Also in photo are BSP Senior Assistant Governor and General Counsel Elmore O. Capule (left) and AMLC Executive Director Matthew M. David (right). (Photo courtesy of the Bangko Sentral ng Pilipinas)
The Bangko Sentral ng Pilipinas (BSP) officials led by Governor and Anti-Money Laundering Council (AMLC) Chairperson Felipe M. Medalla (second from right) expressed their gratitude to Chief Justice Alexander G. Gesmundo and the entire Supreme Court for their support in AMLC initiatives, particularly in strengthening the observance of the anti-money laundering statute in the recently launched Code of Professional Responsibility and Accountability. (From left) AMLC Executive Director Matthew M. David, BSP Senior Assistant Governor and General Counsel Elmore O. Capule, and BSP Monetary Board Members Eli M. Remolona, Jr. and Anita Linda R. Aquino. (Photo courtesy of Atty. Lea Barron)