Record low interest rates in the Philippines have raised concerns over potential asset bubbles in Southeast Asia's fastest growing economy, however the country's finance secretary said these risks are under control.
"The good thing about the Philippines is that we've been through the Asian financial crisis – we learned painful lessons – so we've been very vigilant," Finance Secretary Cesar Purisima told CNBC on the sidelines of the World Economic Forum in Manila, referring to the 1997 financial crisis in East Asia saw the country's currency, stock market and economic growth decline sharply.
"The central bank, for example, has been watching the natural potential suspect – the real estate market. The regulators are on top of the ball there," he said.
Earlier this week, the Bangko Sentral ng Pilipinas (BSP) asked banks to assess how interest rate changes affect the real estate sector and banks' balance sheets as part of planned stress tests on the sector.
BSP governor Amando Tetangco said if the impact is significant, banks concerned may be asked to submit plans on how to address the impact on balance sheets.