Documente Academic
Documente Profesional
Documente Cultură
i.."..
.. .
;:
-~:
'16 JUL 21
P3 :42
SENATE
S.No.
859
'.
,.
~y.
it
'-1-~f---
AN ACT
PROVIDING FOR A COMPREHENSIVE REVISION OF THE CHARTER OF THE
BANGKO SENTRAL NG PIL~PINAS (BSP) BY AMENDING REPUBLIC ACT NO. 7653,
OTHERWISE KNOWN AS "THE NEW CENfRAL BANK ACT"
Explanatory Note
No less than the 1987 Constitution mandates the establishment of a central monetary
authority that shall provide policy direction in the areas of money, banking, and credit, and exercise
supervision over the operations :of banks, finance companies and other institutions performing
similar functions.
With these in mind, Congress enacted a new Central Bank law or Republic Act No. 7653 in
1993 to replace the old one, which was in effect as early as 1948. While the old Central Bank law Republic Act No. 265- was amended four times during its lifetime, the new law or R.A. No. 7653
has never been changed in its 23 years of effectivity.
It is therefore imperative that R.A. No. 7653 - the law that created the present Bangk:o
Sentral ng Pilipinas (BSP) - be revisited and amended accordingly to respond to the changing
times. The prevailing situation 23 years ago are not the same as today and there is a need to redefine
or clarify some concepts in the BSP charter in order to render it more effective.
This bill aims to amend the BSP charter to strengthen the institution and plug the supposed
gaps and loopholes which the authors of the present law failed to anticipate 23 years ago.
One of the most important amendments of this proposed measure is to incorporate the
promotion of full employment a~ one of two primary objectives of the BSP in its formulation of
monetary policy, along with maintaining price stability.
It is the contention of the author that the inclusion of advancing full employment as one of
the primary objectives of the BSP will have significant and positive effects on the country's
economic and fmancial development. It will also affirm the State's mandate to make labor a
primary social economic force.
Establishing a mechanism for the full payment of the national government's unpaid
subscription to the BSP as mandated by R.A. No. 7653.
Expanding the BSP's supervisory powers to include credit card companies, e-money issuers,
remittance agents and institutions performing similar functions.
.
Deleting the provision which requires the confirmation of the BSP Governor by the
Conunission on Appointments.
Proposing that no member of the Monetary Board, including the BSP governor and vice
governors, shall be elected as director, or employed as officer or employee, or hired as
consultant, adviser, lawyer, or in any other capacity in institutions regulated by the BSP
three (3) years after their term.
Allowing the Monetary Board to conduct a meeting through vide<> conferencing or
teleconferencing, as required by circumstances.
Increasing the number of deputy governors from three (3) to five (5).
Semi-ammal appearance before key committees in both houses of Congress.
Other key features of the bill include amendments to provisions governing Reports of
Examination (ROEs); appointment of conservators; proceedings in receivership and liquidation;
prompt corrective actions; bridge banking; credit facilities for Islamic banks; and the BSP's
exemption from taxes and Customs duties.
These amendments are seen to improve the BSP in its mandate to provide policy direction in the
areas of money, banking, and credit. They will also aid the BSP in the exercise of its regulatory and
supervisory powers over the operations of banks, finance companies and other institutions
performing similar functions.
In view ofthe foregoing, the passage of this bill is earnestly sought.
/~jcv
16 JUL 21
P3 =42
SENATE
S.No.
859
AN ACT
PROVIDING FOR A COMPREHENSIVE REVISION OF THE CHARTER OF THE
BANGKO SENTRAL NG PILIPINAS (BSP) BY AMENDING REPUBLiC ACT NO. 7653,
OTHERWISE KNOWN AS "THE NEW CENTRAL BANK ACT"
SECTION 1. Section 2 of Republic Act No. 7653 is hereby amended to read as follows:
"SEC. 2. Creation of the Bangko Sentral. -
independent central monetary authority, which shall be a body corporate known as the
Bangko Sentral ng Pilipinas, hereafter referred to as the Bangko Sentral.' The capital of
Ten Billion Pesos (P 10,000,000,000) of which shall be fully paid for by the Government
upon the effectivity of this Act [and the balance to be paid for within two (2) years from
the effectivity of this Act in such manner and form as the Govemrnerit, through the
10
Secretary of Finance and the Secretary of Budget and Management, inay thereafter
11
12
13
14
15
16
17
18
19
20
THAT
21
SEC. 2. Section 3 of Republic Act No. 7653 is hereby amended to read as follows:
22
THE
23
provide policy directions in the areas of money, banking, and credit. It shall have
2.4
supervision over the operations of banks and exercise such regulatory powers as
25
provided in this Act and other pertinent laws over the operations of finance companies
Page 1 of40
10
11
12
13
SEC. 3. Section 6 of Republic Act No. 7653 is hereby amended to read as follows:
14
"SEC. 6. Composition of the Monetary Board. - The powers and functions of the
15
Bangko Sentral shall be exercised by the Bangko Sentral Monetary Board, hereafter referred
16
to as the Monetary Board, composed of seven (7) members appointed by the President of
17
18
19
(a) the Governor of the Bangk:o Sentral who shall be the Chairman of the Monetary
20
Board. (The Governor of the Bangko Sentral shall be head of a department and his
21
22
Whenever the Governor is unable to attend a meeting of the Board, he shall designate a
23
Deputy Governor to act as his alternate AND THE ATTENDANCE OF THE LATTER
24
25
26
27
28
BOARD, the Monetary Board shall designate one of its members as acting Chairman;
29
30
Whenever the designated Cabinet Member is unable to attend a meeting of the Board, he
31
32
33
34
35
(c) five (5) members who shall come from the private sector, all of whom shall serve
36
full-time: Provided, oowever, That of the members first appointed under the provisions of
37
this subsection, three (3) shall have a term of six (6) years, and the other two (2), three (3)
38
years. No member of the Monetary Board may be reappointed more than once."
Page 2 of40
1
2
SEC. 4. Section 9 of Republic Act No. 7653 is hereby amended to read as follows:
"SEC. 9. Disqualifications. -
Republic Act No. 6713, a member of the Monetary Board is disqualified from being a
director, officer, employee, consultant. lawyer, agent or stockholder of any bank, quasi-
Bangko Sentral, in which case such member shall resign from, and divest himself of any
and all interests in such institution before assumption of office as member of the
Monetary Board.
10
The members of the Monetary Board coming from the private sector shall not
hold any other public office or public employment during their tenure.
11
12
13
interest in any private bank in the Philippines, within one (1) year prior to his
14
15
such institution within two (2) years after the expiration of his term except when he
16
17
18
19
20
21
22
23
CAPACITIES
24
25
26
27
28
EXCEPT
29
30
31
INSTITUTION."
32
WHEN
IN
ANY
OTHER
OF
SUCH
INSTITUTIONS
OFFICIALS
IS
Tllt\T
APPOINTED
ARE
OR
SEC. 5. Section 11 of Republic Act No. 7653 is hereby amended to read as follows:
33
"SEC. 11 . Meetings. - The Monetary Board shall meet at least once a week. The
34
Board may be called to a meeting by the Governor of the Bangko Sentral or by two (2)
35
36
37
The presence of four (4) members shall constitute a quoruin: Provided, That in
all cases the Governor or his duly designated alternate shall be among the four (4).
Page 3 of40
1
2
Unless otherwise provided in this Act, all decisions of the Monetary Board shall
require the concurrence of at least four (4) members.
THE MEETING. OF THE MONETARY BOARD, AS REQUIRED BY
CIRCUMSTANCES,
MAY
BE
CONDUCTED
THROUGH
MODERN
10
11
12
THE MEETING.
13
14
15
16
17
18
19
The Bangk:o Sentral shall maintain and preserve a complete 'record of the
20
proceedings and deliberations of the Monetary Board, including the tapes .and transcripts
21
22
23
SEC. 6. Section 12 of Republic Act No. 7653 is hereby amended to read as follows:
24
25
26
MONETARY BOARD, attend the meetings of the Monetary Board with. the right to be
27
28
29
30
31
32
33
SEC. 7. Section 15 of Republic Act No. 7653 is hereby amended to read a.q follows:
"SEC. 15. Exercise ofAuthority. -In the exercise of its authority, the Monetary
Board shall:
34
(a) issue rules and. regulations it considers necessary for the effective discharge
35
of the responsibilities and exercise of the powers vested upon the Monetary Board and
36
the Bangko Sentral. The roles and regulations issued shall be reported to the President
37
and the Congress within fifteen (15) days from the date of their issuance;
Page 4of40
. -
PENALTY
SUPERVISEDIREGUL~TED
AFFECTED.
OR
SANCTION
AGAINST
THE
INSTITUTIONS
UNLESS
PUBLISHED
CIRCULATION;
IN
TWO
(2)
NEWSPAPERS. OF . NATIONAL
10
(b) direct the management, operations, and administration of the Bangko Sentra),
11
12
13
and regulations as it may deem necessary or convenient for this. purpose. [The legal
14
units of the Bangko Sentral shall be under the exclusive supervision and control of the
15
Monetary Board;]
16
17
18
19
20
21
22
(c) establish a human resource management system which shall govern the
23
24
system shall aim to establish professionalism and excellence at all levels of the Bangko
25
26
A compensation structure, based on job evaluation studies and wage surveys and
27
28
Bangko Sentral's human resource development program: Provided, That the Monetary
29
Board shalt make its own system conform as c1osely as possible with the principles
30
provided for under Republic Act No. 6758[: Provided, however, That compensation and
31
wage structure of employees whose positions fall under salary grade 19 and below shall
32
be in accordance with the rates prescribed under Republic Act No. 6758].
33
34
other emoluments, and remove personnel of the Bangko Sentral, subject to pertinent
35
civil service laws: Provided, That the Monetary Board shall have exclusive and final
36
authority to promote, transfer, assign, or reassign personnel of the Bangko Sentral and
37
these personnel actions are deemed made in the interest of the service and not
Page 5 of40
disciplinary: Provided, further, That the Monetary Board may delegate stich authority to
(d) adopt an annual budget for and authorize such expenditures by the Bangko
Sentral as are in the interest of the effective administration and operations. of the Bangko
(e) indemnify its members and other officials of the Bangko Sentral, including
expenses reasonably incurred by such persons in connection with any civil or criminal
10
action, suit or proceedings to which he may be, or is, made a party by reason of the
11
12
13
14
only in connection with such matters covered by the settlement as to which the Bangko
15
Sentral is advised by external counsel that the person to be indemnified [did not commit
16
17
The costs and expenses incurred in defending the aforementioned action, suit or
~y
18
19
20
21
22
23
24
SEC. 8. Section 16 of Republic Act No. 7653 is hereby amended to read as follows:
25
26
examiners, and employees of the Bangko Sentral who willfully violate this Act or who
27
28
extraordinary diligence in the performance of [his] THEIR duties shall be held liable
29
for any loss or injury suffered by the Bangko Sentral or other banking institutions as a
30
31
32
33
Bangko Sentral for: (1) the disclosure of any information of a confidential nature, [or
34
any information on the discussions or resolutions of the Monetary Board,] or about the
35
36
with the performance of official functions with the Bangko Sentral, or is with prior
37
authorization of the Monetary Board or the Governor; or (2) the use of such infonnatjon
38
for personal gain or to the detriment of the Government) the Bangko Sentral or third
Page 6 of40
parties: Provided, however, That any data or information required to be submitted to the
President and/or the Congress, or to be published under the provisions of this Act shall
s
6
SEC. 9. Section 17 ofRepublic Act No. 7653 is hereby amended to read as follows:
"SEC. 17. Powers and Duties of the Govenzor. -The Governor shall be the
chief executive officer of the Bangko Sentral. H1s powers and duties shall be to:
OF A MEMBER OF THE MONETARY BOARD, the agenda for the meetings of the
Monetary Board and to submit for the consideration of the Board th~ policies and
10
measures [which he belieVes] DEEMED to be necessary to carry out the purposes and
11
12
13
14
15
16
17
18
19
20
Irf
THE AGENDA;
(b) execute and administer the policies and measures approved by the Monetary
Board UPON THEIR EFFECTIVITY;
21
(c) direct and supervise the operations and internal administrationofthe Bangko
22
23
24
25
26
27
REQUIRE or subject to such rules and regulations as the Monetary Board may
28
29
30
31
32
33
34
35
36
37
38
(d) appoint and fix the remunerations and other emoluments of personnel below
2.
the rank of a department head in accordance with the position and compensation plans
personnel of the Bangko Sentral, subject to the provisions of Section IS(c) of this Act:
Provided, That removal of personnel shall be with the approval of the Monetary Board;
AND
((e) render opinions, decisions, or rulings, which shall be final and executory
10
11
[(f)] (E) exercise such other powers as may be vested in him by the Monetary
12
13
14
Board."
SEC. 10. Section 19 of Republic Act No. 7653 is hereby amended to read as follows:
15
16
where time is insufficient to call a FORMAL meeting of the Monetary Board, the
17
Governor of the Bangko Sentral, with the concurrence of [two (2)] THREE (3) other
18
members of the Monetary Board, may decide [any] AN URGEN~ matter or take [any]
19
20
21
MONETARY BOARD.
The Governor shaJl submit a report to the President and Congress within
2.2
23
25
26
At the soonest possible time, the Governor shall call a meeting of the Monetary
24
27
"SEC. 21. Deputy Governors. - The Governor of the Bangko Sentral, with the
28
approval of the Monetary Board, shall appoint not more than (three (3)] FIVE (5)
29
Deputy
30
31
32
33
34
Governors
who
shall
perform
duties
AND
RESPONSffiiLITIES
35
36
OF
COMMERCIAL
AND
37
UNIVERSAL
BANKS
(INCLUDING
THEIR
Page B of40
UNDERTAKINGS)
AS
CONTROLLED BANKS;
WELL
AS
GOVERNMENT-OWNED
AND
AND EXAMINATION
NOT
AFFILIATED
TO
UNIVERSAL
OR
COMMERCIAL
BANKS);
10
11
ASSOCIATIONS;
12
13
PAWNSHOPS;
DEPUTY
CREDIT
GOVERNOR
FOR
CARD
HUMAN
COMPANIES;
RESOURCES
14
15
16
17
18
19
20
21
22
AND VALUES
23
THE MEDICAL AND DENTAL CLINIC, AND WHO SHALL SUPERVISE THE
24
25
26
27
28
29
E~CEMENT
30
31
32
THEM
33
34
.THE
35
36
GOVERNOR.
THE MANAGEMENT
37
38
39
AND
THE
MONETARY
:DELINEATION
BOARD
OF
UPON
OF
OTHER
FUNCTIONS
RECOMMENDATION
THE
PROVIDENT
AND
OF
THE
FUND,
THE
Page 9 of40
THE
GOVERNOR.
MONETARY
BOARD,
UPON
RECOMMENDATION
THE
OF
{In the absence of the Governor, a Deputy Governor designated by the Governor
shall act as chief executive of the Bangko Sentral and shall exercise the powers and
perform the duties of the Governor. Whenever the Government is unable to attend
10
11
Governor shall be vested with authority to participate and exercise the right to vote in
12
such meetings.]"
13
SEC. 12. Section 23 of Republic Act No. 7653 is hereby amended to read as follows:
14
"SEC. 23. Authority to Obtain Data and Information. -.The Bangko Sentral
15
shall have the authority to (request) REQUIRE from ANY PERSON OR ENTITY,
16
17
controlled corporations, any data which it may require for the proper discharge of its
18
functions and responsibilities. The Bangko Sentral through the Governor or in his
19
absence, a
20
AUTHORIZED IN WRITING shall have the power to issue a subpoena [for the
21
22
DATA REQUIRED AND THE SPECIF1C PURPOSE FOR WHICH SUCH DATA
23
SHALL BE ISSUED. Those who refuse the subpoena without justifiable cause, or who
24
refuse to supply the [bank] BANGKO SENTRAL with data (requested or] required,
25
shall be subject to punishment for contempt in accordance with the provisions of the
26
Rules of Court.
~PECIFYING
THE
27
Data on individu.aiS AND finns, other than banks. gathered by the Department
28
of Economic Research and other departments or units of the Bangko Senttal shall not be
29
made available to any person or entity outside of the Bangko Sentral whether public or
30
private except under order of the court or under such conditions as may be prescribed by
31
the Monetary Board: Provided, however, That the collective data on firms may be
32
released to interested persons or entities: Provided, Finally, That in the case of data on
33
34
SEC. 13. Section 24 of Republic Act No. 7653 is hereby amended to read ~s follows:
35
36
sponsor the training of technical personnel in the fields of [money and banking]
37
Page 10 of40
SAVINGS
INFORMATION
FORMATION,
PAYMENT
TECHNOLOGY,
AND
MONEY
.
SETTLEMENT
AND
CAPITAL
SYSTEMS,
MARKETS
APPROVE. Toward this . end, the Bangko Sentral is hereby authorized to defray the
10
11
rules and regulations to govern the training program of the Bangko Sentral."
SEC.14. Section 25 of Republic Act No. 7653 is hereby amended to read as foll~ws:
12
13
14
15
THIS ACT shall have supervision over, and conduct (periodic] REGULAR or special
16
17
18
19
20
21
22
23
24
means a corporation more than fifty percent (50%) of the voting stock of which is
25
26
means a corporation the voting stock of which, to the extent of fifty percent (50%) or
27
28
29
30
31
32
33
34
35
36
37
38
10
SUPERVISED INSTITUTION.
11
The department heads and the examiners of the supervising and/or examining
12
13
14
examination and to compel the presentation of all books, documents, papers or records
15
necessary in their judgment to ascertain the facts relative to the true condition of any
16
institution as well as the books and records of persons and entities relative to or in
17
18
19
20
21
[No restraining order or i"njunction shall be issued by the court enjoining the Bangko
22
23
Bangko Sentral. unless there is convincing proof that the action of the Bangko SentraJ is
24
plainly arbitrary and made in bad faith and the petitioner or plaintiff files with the clerk
25
26
Bangko Sentral, in an amount to be fixed by the court. The provisions of Rule 58 of the
27
New Rules of Court insofar as they are applicable and not inconsistent with the
28
provisions of this Section shall govern the issuance and dissolution of the restraining
29
'
30
31
in favor of the
SEC. 15. Section 26 of Republic Act No. 7653 is hereby amended to read as fol.lows:
"SEC. 26.
32
stockholder who, together with his related interest, contracts a loan or any form of
33
financial acconunodation from: (1) his bank; or (2) from a bank (a) which is a subsidiary
34
of a bank holding company of which both his bank and the lending bank are subsidiaries
35
or (b) in which a controlling proportion of the shares is owned by the same interest that
36
owns a controlling proportion of the shares of his bank, in excess offive percent (5%) of
37
the capital and surplus of the bank, or in the maximum amount permitted by law,
38
whichever is lower, shall be required by the lending bank to waiye the secrecy of his
Page 12 of 40
deposits of whatever nature in all banks in the Philippines. Any information obtained
from an examination of his deposits shall be held strictly confidential and may be used
10
11
12
13
14
15
16
11
18
19
20
21
SEC. 16. Section 27 of Republic Act No. 7653 is hereby amended to read as follows:
"SEC. 27.
Act Nos. 3019 and 6713, personnel of the Bangko Sentral are hereby prohibited from:
22
23
24
examination by the Bangko Sentral, except non-stock savings and loan associations and
25
provident funds organized exclusively for employees of the Bangko Sentral, and except
26
21
gift,
28
(present] IN KIND
29
(another]
RELATIVE
30
31
FOR
WITHIN
THE
FIRST
DEGREE
OF
32
(c) revealing in any manner, except under orders of the court, the (Congress]
33
34
35
36
Board, infonnation relating to the condition or business of any institution UNDER ITS
37
SUPERVISION. lbis prohibition shall not be held to apply to the giving of information
Page 13 of40
to the Monetary Board or the Governor of the Bangko Sentral, or to any person
Bangko Sentral shall be prohibited unless said borrowings are adequately secured, fully
disclosed to the Monetary Board, and shall be subject to such further rules and
regulations as the Monetary Board may prescribe: Provided, however, That personnel of
the supervising and examining departments are prohibited from borrowing from a bank
SEC. 17. Section 28 of Republic Act No. 7653 is hereby amended to read as follows:
10
"SEC. 28. Examination and Fees. - The supervising and examining department
11
head, personally or by deputy, sha11 examine the books AND OPERATIONS of every
12
13
every twelve (12) months, and at such other times as the Monetary: Board by an
14
15
16
17
18
19
Monetary Board: Providecf, That there shall be an interval of at least twelve (12) months
2.0
21
22
23
24
25
26
27
28
29
EXAMINERS INVOLVED.
30
The
bank,
OR
QUASI-BANK
OR
NON-BANK
FINANCIAL
31
INSTITUTION concerned shall afford to the head of the appropriate supervising and
32
examining departments and to his authorized deputies full opportunity to examine its
33
books, cash and available assets and general condition at any time during banking hours
34
when requested to do so by the Bangko Sentral: Provided, however, That none of the
35
reports and other papers relative to such examinations shall be open to inspection by the
36
37
38
which are subject to examination by the Bangko Sentral shall pay to the Bangko Sentral,
within the first thirty (30) days of each year, an annual fee in
percentage as may be prescribed by the Monetary Board of its average total assets
during the preceding year as shown on its end-of~QUARTER (month balance sheets)
STATEMENT OF CONDITION, after deducting cash on hand and amounts due from
an amount equal to a
SEC. 18. Section 29 of Republic Act No. 7653 is hereby amended to read as follows:
10
11
12
department
13
CONSULTATION
14
15
16
17
18
19
20
21
22
23
24
Monetary Board shall deem necessary to ENABLE HIM TO take charge of the assets,
25
liabilities, and the management thereof, reorganize the management, collect all monies
26
and debts due said institution, PLACE OR INVEST ITS FUNDS IN READILY
27
28
29
OBLIGATIONS, and exercise all powers [necessary] to restore AND MAINTAIN its
30
viability. The conservator shall report and be responsible to the Monetary Board, WITH
31
A COPY OF SUCH R EPORT FURNISHED THE PDIC, and shall have the power
32
to ovet111le or revoke the actions of the previous management and board of directors of
33
34
35
INFRINGE
36
CONSTITUTION.
OF
THE
BANGKO
WITH
THE
SENTRAL,
PHILIPPINE
the
Monetary
DEPOSIT
AGAINST
THE
NON-IMPAIRMENT
Board,
IN
lNSURANCE
CLAUSE
OF
ITS
THE
37
38
management The conservatorship shall not exceed one (1) year, WHICH MAY BE
Page 15 of40
PAYMENTS: (in an amount not to exceed two-thirds (2/3) of the salary of the
president of the institutiOn in one (1) year, payable in twelve. (12) equal monthly
payments:] Provided, That, if at any time within the one-year period, the
conservatorship is tenninated on the ground that the institution can operate on its own,
the conservator shall receive the balance of the remuneration which he would have
received up to the end of the year; but if the conservatorship is terminated on other
10
grounds, the conservator shall not be entitled to such remaining balance. The Monetary
11
Board [may appoint a conservator connected with the Bangko Sentral,] SHALL
12
13
14
15
16
MONETARY BOARD SHALL DETERMINE [from the Bangko Sentral) during the
17
18
19
20
21
22
23
24
MONIES
25
26
27
28
29
30
31
32
STIPULATE.
33
AND
DEBTS
DUE
THE
INSTITUTION
UNDER
34
HAVE
THE
AUTHORITY
TO
EXAMINE
THE
BANK
UNDER
35
36
37
38
The Monetary Board shall terminate the conservatorship when jt is satisfied that
the institution can continue to operate on its own and the conservatorship is no longer
necessary. The conservatorship shall likewise be tenninated should the Monetary Board,
on the basis of the report.of the conservator or of its own findings, determine that the
10
11
T~AT
THERE
12
13
14
15
bank:
16
17
18
19
20
liabilities as they become due in the ordinary course of business: Provided, That this
21
shall not include inability to pay caused by extraordinary demands induced by financial
22
un~ble
to pay its
23
24
25
BANKING REGULATIONS; or
26
27
28
INSTITUTION CONCERNED; or
29
(d) has willfully violated a cease and desist order under Section 37 that has
adissipation of
30
31
the assets of the institution; in which cases, the Monetary Board may summarily and
32
without need for prior hearing forbid the institution from doing business in the
33
34
35
36
FINDINGS
37
38
AND
DIRECT
THE
PDIC
TO
PROCEED
WITH
THE
Page 17 of40
ALSO
10
BE
EXERCISED
OVER
OTHER
NON-BANK
FINANCIAL
OF
BE DESIGNATED AS A RECEIVER
11
The receiver shall immediately gather, take charge of, MANAGE AND
12
13
ITS LICENSE, and liabilities of the institution, administer the same for the benefit of
14
its creditors,
15
16
17
18
THE AUTHORITY TO: (1) [but shall not, with the exception of] PAY administrative
19
expenditures, (pay or commit any . act that will involve the transfer or disposition of
20
any asset of the institution: Provided, That the receiver may] (2) deposit or place the
21
22
APPROPRIATE
23
24
25
shaH determine as soon as possible, but not later than ninety (90) days from take-
26
over, whether [the] SUCH institution may be rehabilitated or otherwise placed in such
27
a condition so that it may be permitted to resume business with safety to its [depositors
28
and]
29
30
Monetary Board.
an~
BY . THE
RECEIVER,
BRIDGE
AI:~OPT,
IF DEEMED
BANKING
determina~on
AS
for the
31
32
33
CREDITORS
34
35
36
37
AND
THE
GENERAL
PUBLIC
OR TO
MERGE
OR
Page 18of40
AUTHORIZED BYLAW.
resume business in accordance with the next preceding paragraph OF THIS SECTION,
the Monetary Board shall notify in writing the board of directors of [its] THE
RECEIVER'S findings and direct the receiver to proceed with the liqUidation of the
1. File ex parte with the proper regional trial court, and without requirement of
10
prior notice or any other action, a petition for assistance in the liquidation of the
11
12
Corporation for general application to all closed banks. In case of quasi-banks, the
13
liquidation plan shall be adopted by the Monetary Board. Upon acquiring jurisdiction,
14
the court shall, upon motion by the receiver after due notice, adjudicate disputed claims
15
against the institution, assi.s t the enforcement of individual liabilities of the stockholders,
16
directors and officers, and decide on other issues as may be material to implement the
17
liquidation plan adopted. The receiver shall pay the cost of the proceedings from the
18
19
2. Convert the asse:ts of the institution to money, dispose of the same to creditors
20
and other parties, for the purpose of paying the debts of such institution. in accordance
21
with the rules on concurrence and preference of credit under the Civil Code of the
22
Philippines and he may, in the name of the institution, and with the.assistance of counsel
23
as he may retain, institute such actions as may be necessary to colleCt and recover
24
accounts and assets of, or defend any action against, the institution. The assets of an
25
26
hands of the receiver and shall, from the moment the institution was placed under such
27
28
or execution.
29
The actions of the Monetary Board taken under this section or under Section 29
30
of this Act shall be final and executory, and may not be restrain~ or s et aside by the
31
court except on petition for certiorari on the ground that the action taken was in excess
32
33
jurisdiction. The petition for certiorari may only be filed by the stockholders of record
34
representing the majority of the capital stock within ten (1 0) days from receipt by the
35
36
conservatorship.
37
38
of a receiver under this section shall be vested exclusively with the Monetary Board.
Page 19 of40
a receiver.]"
SEC. 20. A new section entitled section 30-A of the same Act shall be inserted between Section 30
UNDER
10
PRESCRIBED
11
12
13
14
15
16
17
18
19
20
21
22
23
EXISTING
LAWS
AND
IMPLEMENTING
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
10
BA~K,
TO THE
THE
11
STATU~ORY
12
13
14
15
16
TO
17
18
19
AUTHORIZED
20
21
OTHER
CREDITS
TO
BUT
SUPERIOR
BE ISSUED,
WITH
TO
THE
NATIONAL
CHARTERS,
EQUITY
OF
GOVERNMENT
22
SEC. 21. A new section entitled section 30-B of the same Act shall be inserted between Sections 30-
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
Page 21of40
5
6
7
8
1.
SELL,
ASSIGN,
TRANSFER,
OR
CONVEY
ITS
10
11
12
SHALL:
13
I.
14
15
16
17
18
19
20
21
22
23
24
25
26
GARNISHMENT,
27
28
HEREOF.
29
30
31
32
33
3.
SUBSECTION
LEVY,
ATTACHMENT
OR
34
35
36
37
38
Page 22 of40
3
4
EXAMINE AND
10
11
12
AUDIT
THE
DEPOSIT ACCOUNTS
AND/OR
13
14
15
COMPENSATION.
16
17
18
SHALL
19
DETERMINE
WHETHER
THE
INSTITUTION . MAY
BE
20
21
22
23
(H); PROVIDED, FURTHER, THAT THE PDIC MAY EXTEND THE STATUS
24
25
26
27
28
29
30
31
32
BANK;OR
33
2. THE SALE
34
35
36
37
38
39
OF
~/OR (ii)
Page23of40
THE
BRIDGE
BANK
AND
THE
SALE
ALL
OF
OR
10
11
12
13
14
15
16
17
18
19
20
21
22
23
INSURED BANK.
24
25
26
AUDIT ONLY.
27
28
29
30
31
32
33
THE PETITION FOR CERTIORARI MAY ONLY BE FILED WITHIN TEN (10)
34
35
OF A BRIDGE BANK.
GMVE . ABUSE
OF
36
37
38
SECTION."
39
SEC. 22. Section 33 of Republic Act No. 7653 is hereby amended to read as follows:
Page 24of40
"SEC. 33.
interest so requires, award to an institution, upon such terms and conditions as the
Monetary Board may approve, the banking franchise of a CLOSED bank [Wlder
liquidation) to operate in the area where said bank or its branches were previously
operating: Provided, That whatever proceeds may be realized fro~ such award shall be
[subject to the appropriate exclusive disposition of the Monetary Board] FOR THE
8
9
SEC. 23. Section 36 of Republic Act No. 7653 is hereby amended to read as follows:
"SEC. 36. Proceedings Upon Violation of this Act and Other Banking Laws,
b~
10
11
12
13
person or entity willfully violates this Act or other pertinent banking laws being
14
15
regulation issued by the Monetary Board, the person or persons responsible for such
16
violation shall unless otherwise provided in this Act be punished by a fine of not less
17
than Fifty Thousand Pesos (P50,000) nor more than (Two Hundred Thousand Pesos
18
19
than two (2) years nor more than [ten (10)] SIX (6) years, or both, a't the SOUND
20
[or) quasi-bank, OR
21
22
23
24
25
26
27
28
penalties provided in the preceding paragraph of this Section and the administrative
29
sanctions provided in Section 37 of this Act, take action under Section 30 ofthis Act."
AND
To INSTITUTE
30
SEC. 24. Section 37 of Republic Act No. 7653 is hereby amended to read .as follows:
31
Without
32
prejudice to the criminal sanctions against the culpable persons provided in Sections 34,
33
35, and 36 of this Act, the Monetary Board may, at its discretion, impose
34
35
and/or officers, for any willful violation of its charter or by-laws, willful delay in the
36
37
any refusal to permit examination into the affairs of the institution; any willful making
Page zs of40
examining department or its examiners; any willful failure or refusal to ciJmply with, or
violation of, any banking law or any order, instruction or regulation issued by the
BANKING
10
11
THE PROVISIONS OF TIDS ACT, OF REPUBLIC ACT NO. 879i AND OTHER
12
13
14
15
applicable.
16
INSTITUTIONS
PERFORMING
SIMILAR
FUNCTIONS
17
IMPOSED
TAKING
INTO
CONSIDERATION
THE
ATTENDANT
18
19
20
21
22
23
case to exceed [Thirty Thousand Pesos (P30,000) a day for each violation, taking into
24
consideration the attendant circumstances, such as the nature and gravity of the violation
25
26
PENALTIES
27
FOLLOWS:
PRESCRIBED
HEREIN
FOR
EACH
.:viOLATION,
28
29
30
31
BANKINGDAY;
32
3. FOR RURAL
33
34
35
36
37
5.
38
FOR
BANKS/COOPERATIVE BANKS -
FINANCE
COMPANIES
AND
AS
NOT
FINANCIAL
Page 26of40
BANKING FUNCTIONS -
BANIONG DAY;.
BANKINGDAY.
VIOLATIONS
10
11
12
13
14
15
MAXIMUM PENALTIES.
16
IN
OR
IRREGULARILITIES
COMPUTING THE
COMMITTED
AFOREMENTIONED
BY
EVERY
PENALTIES, THE
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
facilities;
(c) suspension of lending or forei gn exchange operations or authority to accept
new deposits or make new inve.<;tments; AND/OR
36
37
Page 27 of40
Resignation or termination from office shall not exempt such director or officer
an investigation: Provided, That should the case be not finally decided by the Bangko
Sentral within a period of one hundred twenty (120) days after the date of suspension,
said director or officer shall be reinstated in his position: Provided, further, That when
the delay in the disposition of the case is due to the fault, negligence or petition of the
director or officer, the period of delay shall not be counted in computing the period of
10
11
12
severity.
13
14
15
16
order requiring the institution and/or the directors, and/or officers concerned to cease
17
and desist from the indicat.e d practice or violation, and may further" order that immediate
18
action be taken to correct the conditions resulting from such practice or violation. The
19
cease and desist order shall be immediately effective upon service on the respondents.
20
21
hearing before the Monetary Board or any committee chaired by any M.onetary Board
22
member created for the purpose, upon request made by the respondents within five (5)
23
days from their receipt of the order. If no such hearing is requested within said period,
24
the order shall be final. If a hearing is conducted, all issues shall be determined on the
25
basis of records, after which the Monetary Board may either reconsider or make final its
26
order.
27
28
institutions for any failure to comply with the requirements of law, Monetary Board
29
regulations and policies, and/or instructions issued by the Monetary Board or by the
30
Governor, fines not in excess of Ten thousand pesos (PJ 0,000) a day for each violation,
31
the imposition of which shall be final and executory until reversed, modified or lifted by
32
33
34
SEC. 25. Section 40 of Republic Act No. 7653 is hereby amended to read as follows:
"SEC. 54.
35
end of March of each year, the Bangko Sentral shall publish and submit to the President
36
and the Congress an annual report on the condition of the Bangk.o Sentral including a
37
review of the policies and measures adopted by the Monetary Board during the past year
Page 28of40
and an analysis of the ecOnomic and financial circumstances which gave rise to said
The annual report shall also include a statement of the financial condition of the
Bangko Sentral and a statistical appendix which shall present, as a minimum> the
10
11
12
13
14
15
16
17
PRODUCTION,
18
19
PRICES.
JNVESTMENT,
REAL
INCOME,
PRODUCTIVITY,
20
21
22
23
24
25
(b) the monthly movement of purchases and sales of foreign exchange and of the
26
27
28
(d) monthly indices of consumer prices and of import and export prices;
29
30
31
32
33
34
(f) the monthly movement of the accounts of the Bangko Sentral and of other
banks;
(g) the principal data on government receipts and expenditures and on the status
35
(h) the texts of the major legal and administrative measures adopted by the
36
Government and the Monetary Board during the year which relate to the
37
38
AND
Page 29 of40
(The Bangko Sentral shall publish another version of the annual report] THE
without justifiable reason as may be determined by the Monetary Board shall cause the
10
withholding of the salary of the personnel concerned until the requirements are
11
complied with."
12
SEC. 26. Section 54 of Republic Act No. 7653 is hereby amended to read as follows:
13
"SEC. 54. Printing ofNotes and Minting of Coins.- The Monetary Board shall
14
prescribe the amounts of notes and coins to be printed and minted,.respectively, and the
15
conditions to which the printing of notes and the minting of coins shall be subject. The
16
Monetary Board shall have the authority to contract institutions, mints orfirms for such
17
operations.
18
THE HEAD
19
20
21
22
23
24
25
26
OUTSOURCED~ A
REPORT
27
28
29
CONTAIN
30
PRODUCTION JOB:
THE
THE
FOLLOWING
VOLUME
MINIMUM
OF
INFORMATION
NOTES/COINS
AS
PER
31
(A)
.ACTUALLY
32
PRINTED/MINTED:
33
34
35
36
37
38
39
PRINTED/MINTED IN-HOUSE;
Page 30 of40
PRODUCTION OUTPUT;
OF PRODUCTION OUTPUT;
10
11
12
PRINTED/MINTED.
13
All expenses incurred in the printing of notes and the minting of. coins shall be
14
15
16
17
18
19
20
PRICE STABILITY.
21
22
23
24
SEC. 28. Section 81 ofRepublic Act No. 7653 is hereby amended to read as follows:
25
"SEC. 81. Guiding Principles. -The rediscounts, discounts, loans and advances
26
which the Bangko Sentral is authorized to extend to banking institutions AND OTHER
27
28
artide of this Act shall be used to influence the volume of credi.t consistent with the
29
30
SEC. 29. Section 83 of Republic Act No. 7653 is hereby amended to read as follows:
31
"SEC. 83. Loans for Liquidity Purposes.- The Bangko Sentral, BY A VOTE
32
33
34
35
for a period of not more than [seven (7)] FORTY-FIVE (45) BANKING days without
36
any collateral for the purpose of providing liquidity to the banking system in times of
37
AND OTHER
Page 31 of40
'
..
'
BANGKO SENTRAL." .
SEC. 30. Section 84 of Republic Act No. 7653 is hereby amended to read as follows:
"SEC. 84. Emergency Loans and Advances. -
In
perio~s
of national and/or
local emergency or of imlninent financial panic which directly threaten monetary and
(banking) FINANCIAL stability, the Monetary Board may, by a vote of at least five (5)
of its members, authorize the Bangko Sentral to grant extraordinary loans or advances to
banking,
BANGKO SENTRAL-SUPERVISED
10
defined hereunder: Provided, That while such loans or advances- are outstanding, the
11
debtor institution shall not, except upon prior authorization by the Monetary Board,
12
13
The Monetary Board may, at its discretion, likewise authorize the Bangko
14
15
AND
16
SUPERVISED institutions, even during normal periods, for the purpose of assisting a
17
18
unforeseen events, or events which, though foreseeable, could not be prevented by the
19
bank concerned: Provided, however, That the Monetary Board has ascertained that the
20
bank is not insolvent and has the assets defined hereunder to secure the advances:
21
Provided, further, That a concurrent vote of at least five (5) members of the Monetary
22
Board is obtained.
23
OTHER
SYSTEMICALLY
CRITICAL
BANGKO
e~
SENTRAL-
24
25
[banking) institution and shall be disbursed in two (2) or more tranches. The amount of
26
the first tranche shall be limited to twenty-five percent {25%) of the BORROWINGS
27
[total deposit and deposit substitutes] of the institution and shall be secured by (A)
28
government securities [to the extent of their applicable loan values and]; (B)
29
ACCEPT ABLE
30
31
32
THEIR APPLICABLE LOAN VALUES which the Monetary Board .may approve:
33
34
the emergency warrant a loan or advance greater than the amount provided hereinabove,
35
the amount of the first tranche may exceed twenty-five percent (2.5%) Of the {bank's]
36
37
GUARANTEES
BACKED
UP
BY
THE
NATIONAL
Page 32 of40
Monetary Board, and the principal stockholders of the institution furnish an acceptable
undertaking to indemnify and hold harmless from suit a conservator whose appointment
Prior to the release of the first tranche, the {banking) institution shall submit to
the Bangko Sentral a resolution of its board of directors authorizing the Bangko Sentral
to evaluate other assets of the [banking] institution certified by its external auditor to be
good and available for collateral purposes should the release of the subsequent tranche
10
11
The Monetary Board may, by a vote of at least five (5) of its members, authorize
12
the release of a subsequent tranche on condition that the principal stockholders of the
13
institution:
14
(a) furnish an acceptable undertaking to indemnify and hold harmless from suit a
15
conservator whose appointment the Monetary Board may find necessary at any
16
time; and
17
(b) provide acceptable security which, in the judgment of the Monetary Board,
18
19
20
In connection with the exercise of these powers, the prohibitions in Section 128
21
of this Act shall not apply insofar as it refers to acceptance as collateral of shares and
22
23
rights pertaining to said shares: Provided, however, That should the Bangko Sentral
24
25
proceedings, the Bangko Sentral shall dispose of said shares by public bidding within
26
one (1) year from the date of consolidation of title by the Bangko Sentral.
27
28
Bangko Sentral, the same shall be eliminated within the period prescribed in Section 102
29
of this Act."
30
SEC. 31. A new section entitled Section 88-A of the same Act shall be inserted between Section 88
31
32
33
34
35
36
37
INCLUDED
38
INSTITUTIONS,
IN
THE
PROPERTY
UNLESS
THE
OF
INSOLVENT
SECURED
LOANS
PE RSONS
AND
OR
ADVANCES
Page 33 of40
.
-
SEC. 32. A new section entitled Section 88-B of the same Act shall be inserted between Section 88-
EXTRAJUDICIAL
FORECLOSURE
OF
MORTGAGE,
THE
BANGKO
10
11
12
13
14
15
16
17
AFTER ANY ACTION HAS BEEN TAKEN BY HIM, WHICH COURT SHALL
18
19
ALL RESPECTS.
20
21
22
23
24
25
26
27
28
29
30
WILL PAY THE DAMAGES WHICH THE PARTY MAY SUFFER BY THE
31
32
33
34
35
36
SECTION."
37
SEC. 33. A new section entitled Section 88-C of the same Act shall be inserted between Section 88-B
38
Page 34of40
"SEC. 88-C.
10
11
12
13
14
THE PROPERTY.
15
16
17
POSSESSION
18
19
20
OF
THE
FORECLOSED
PROPERTY
DURJNG
THE
21
SEC. 34. A new section entitled Section 89-A of the same Act shall be inserted between Section 89
22
23
"SEC. 89-A.
24
25
26
27
28
29
SEC. 35. Section 92 of Republic Act No. 7653 is hereby amended to read as follows:
"SEC. 92. Issue and Negotiation of Bangko Sentral ObligationS. -
In order to
30
provide the Bangko Sentral with effective instruments for open market operations, the
31
Bangko Sentral may, subject to such rules and regulations as the Monetary Board may
32
prescribe and in accordance with the principles stated in Section 90 of this Act, issue,
33
place, buy and sell freely negotiable evidences of indebtedness of the Bangko Sentral. (:
34
Provided, That issuance of such certificates of indebtedness shall be made only in cases
35
36
issued directly against the international reserve of the Bangko Sentral or against the
37
securities which it has acquired under the provisions of Section 91 of this Act, or may be
38
The Monetary Board shall determine the interest rates, maturities and other
indebtedness of the Bangko Sentral to which this Section refers may be acquired by the
Bangko Sentral before their maturity, either through purchases in the Qpen market or
through redemptions at par and by lot if the Bangko Sentral has reserved the right to
Bangko Sentral shall not be included among its assets, and shall be immediately retired
10
and cancelled.
11
12
13
14
INSTITUTIONS
15
16
17
TIME.
18
19
20
21
SENTRAL."
DULY
ACCREDITED
UNDER
SUCH
22
AND
RULES
RESALE
MAY
BE
SUBJECT TO
SEC. 36. Section 95 of Republic Act No. 7653 is hereby amended to read as follows:
23
24
defined as an alternative form of obtaining funds from the public; other.than deposits,
25
through the issuance, endorsement, or acceptance of debt instruments for the borrower's
26
own account, for the pui-pose of relending or purchasing of receivables and other
27
obligations. These instruments may include, but need not be limited to, bankers
28
29
30
31
32
33
34
35
36
37
38
39
considered as deposit substitutes for the purposes of Section 94 of this Act(:]. THE
other non-financial companies for the limited purpose of financing their own needs or
the needs of their agents or dealers shall not be covered by the provisions of Section 94
of this Act."
SEC. 37. Section 99 of Republic Act No. 7653 is hereby amended to read as follows:
10
11
12
13
[gradual] manner [and shall not exceed four percentage points in any thirty-day period]
14
CONSISTENT WITH
15
MONETARY BOARD. Banks and other affected financial institutions shall be notified
16
17
effective."
18
19
THE
SEC. 38. Section 113 ofRepublic Act No. 7653 is hereby amended to read as follows:
"SEC. 113. Official Deposits. -
20
21
22
balances should be depos.ited with the Bangko Sentral, with only minimum working
23
24
the Philippines as the Monetary Board may designate, subject to such rules and
25
regulations as the Board may prescribe: Provided, That such banks may hotd deposits of
26
27
28
29
EXCEPT FOR DEMAND DEPOSITS, the Bangko Sentral [may) . SHALL pay
30
31
32
33
SEC. 39. Section 117 of Republic Act No. 7653 is hereby amended to read as follows:
"SEC. 117. Issue of Government Obligations. obligations
of the
Govenunent,
its
34
representing
political
subdivisions
or
35
instrumentalities, may be made through the Bangko Sentral, which may act as agent of,
36
and for the account of, the Government or its respective subdivisiops or instrumentality,
37
as the case may be: Provided, however, That the Bangko Sentral shall not guarantee the
Page 37 of40
placement of said securiti.es, and shall not subscribe to their issue except to replace its
maturing holdings of securities with the same type as the maturing securities.
DIRECT
PURCHASE
AND
SALE
OF
GOVERNMENT
10
11
12
13
14
15
16
17
18
19
RULES,
20
21
22
23
24
25
26
27
28
29
30
BY
31
SECRETARY OF FINANCE."
32
THE
THEY
SHALL,
MONETARY
AS
PART
BOARD,
IN
OF
THE
GUIDELINES
CONSULTATION
WITH
OF
THE
SEC. 40. Section 118 of Republic Act No. 7653 is hereby amended to read as follows:
33
34
may place the securities to which the FIRST PARAGRAPH OF THE preceding
35
Section refers through direct sale to financial institutions (and the public].
36
The Bangko Sentral shall not be a member of any stock exchange or syndicate, but may
37
38
FINANCE, for the sole purpose of regulating their operations in the placing of
39
government securities.
Page 38 of40
_..
...
., .
""~
securities.''
SEC. 41. Section 119 of Republic Act No. 7653 is hereby amended to read as follows:
redemption of the public debt shall also BE DONE UNDER THE AUTHORITY OF
Sentral.
SEC. 42. Section 125 of Republic Act No. 7653 is hereby amended to read as follows:
10
11
12
13
OPERATIONS shall be exempt [for a period of five (5) years from the approval of this
14
Act] from all national, AND LOCAL (provincial, municipal and city] taxes, fees,
15
16
[The exemption authorized in the preceding paragraph of this Section shall apply
17
to all property of the Bangko Sentral, to the resources, receipts, expenditures, profits and
18
income of the Bangko Sentral, as well as to all contracts, deeds, documents and
19
transactions related to the conduct of the business of the Bangko Sentral: Provided,
20
however, That said exemptions shaH apply only to such taxes, fees, charges and
21
assessments for which the.Bangko Sentral itself would otherwise be liable, and shall not
22
apply to taxes, fees, charges, or assessments payable by persons or other entities doing
23
business with the Bangko Sentral: Provided, further, That foreign loans and other
24
obligations of the Bangko Sentral shall be exempt, both as to principal and interest, from
25
any and all taxes if the payment of such taxes has been assumed by the Bangko
26
SentraL]"
27
SEC. 43. Section 126 of Republic Act No. 7653 is hereby amended to read as follows:
28
"SEC. 126. Exemption from Customs Duties. -The provision of any general or
29
special law to the contrary notwithstanding, the importation and exportation by the
30
Bangko Sentral of notes and coins, and of gold and other metals to be used for purposes
31
authorized under this Act, and the importation of all (equipment] SUPPLIES needed
32
33
coins, metal refining and other security printing operations AND TRANSPORT OF
34
CURRENCY shall be fully exempt from all customs duties and consular fees and from
35
all other taxes, assessments and charges related to such importation or exportation.
pr~duction,
minting of
Page39of40
SEC. 44. A new section entitled Section 126-A of Republic Act No. 7653 shall be inserted between
10
11
LAWS."
12
SEC. 45. Separability Clause. - If any part or provision of this Act shall be held to be
13
unconstitutional or invalid, other parts or provisions hereof which are not affected thereby shall
14
15
SEC. 46. Repealing Clause. - All laws, decrees, executive orders, rules and regulations, or parts
16
thereof which are inconsistent with this Act are hereby repealed, amended or modified accordingly.
17
SEC. 47. Effectivity. -This Act shall take effect fifteen days (15) days following its publication in at
18
Page40 of40