Government agencies and government-owned and controlled corporations are the major holders of government bonds. Other investors include private corporations, banks, retail investors, and asset pooling industries—including pension funds, insurance companies, and asset management companies.

Government agencies and government-owned and controlled corporations—such as the PAG-IBIG Fund, Development Bank of the Philippines, and Bangko Sentral ng Pilipinas (BSP)—invest a portion of their holdings in fixed-income assets. Other major investors include private corporations, banks, and retail investors.

Pension Funds

The Government Service Insurance System (GSIS) and the Social Security System (SSS) are the largest government pension funds. GSIS and SSS are welfare systems for private and corporate employees, respectively. Conservative government investment policies limit investments to government debt securities and shares of leading Philippine companies. Other government pension fund systems, such as the Armed Forces of the Philippines Retirement and Separation Benefit System, invest a part of their portfolios in government bonds and selected commercial paper.

In additional to government funds, there are 33 active pre-need companies offering pension, educational, and interment plans. The Securities and Exchange Commission (SEC) restricts a portion of pre-need investment portfolios to fixed-income securities.

Insurance Companies

There are 32 life insurance firms licensed to operate in the Philippines. Insurance companies like Ayala Life Assurance Incorporated; Philam Insurance Company, Inc.; Sun Life Financial; and The Manufacturers Life Insurance Co. (Phils.), Inc. are major investors in government bonds and commercial paper.

Asset Management Companies

The mutual fund industry in the Philippines is the least developed in Asia. Growth in the industry is restricted by a narrow investor base in which only a few institutional investors participate in the local bond market. There are only three major participants: Philam Asset Management, Sunlife Asset Management, and Bank of the Philippine Islands (BPI) Asset Management and Trust Group. At the end of 2004, total mutual fund assets in the Philippines were valued at PHP29.4 billion.