In this regard, please allow me to walk you through BSP’s initiatives to strengthen good governance in the financial industry and our continuing efforts to ensure that good governance principles are woven into the organizational culture and operations of our supervised institutions.
First, most household debt - mortgage and consumer debt combined - carries a fixed interest rate, which slows the adjustment of interest costs to rising rates. Second, although interest rates on some variable-rate loans will rise quickly, the adjustment for a large number of variable-rate loans could be a good deal slower.