Republic of the Philippines
HOUSE OF REPRESENTATIVES,
Quezon City, Metro Manila

SIXTEENTH CONGRESS
First Regular Session

1491

HOUSE BILL NO.

Introduced by HONORABLE LANI MERCADO-REVILLA

EXPLANATORY NOTE

At present, Overseas Pilipino Workers are considered our moder heroes. Along with
other economic stimulants, the pouring-in of remittances from the OFWs to their families here in
our country contributes a lot to the functioning and survival of our economy. Since the 1970s,
labor export has been regarded by the national government as a means to address the nation’s
twin problems of unemployment and chronic balance of payment deficits. In fact, not only have
jobs in the country been made available to those that remained a part of the domestic labor force,
but more importantly, the remittances of Filipino overseas workers have become the country’s
single biggest source of foreign exchange.

OFWs, which number close to 1.5M excluding workers who have acquired immigrant
status in their host countries, have greatly affected government policies ever since. However
laudable, the programs of the government have been focused mainly in the areas providing
welfare protection to Filipino overseas workers and encouraging them to continually remit their
foreign exchange earnings through the grant of certain incentives. In the area of investment, the
government has only the establishment of the Overseas Workers Investment Fund to offer for the
overseas workers to venture upon.

To say the least, this bill seeks to further enhance the investment potentials of overseas
workers while at the same time aims to address their various financial needs and concerns, It
provides for the establishment of a banking institution for Filipino overseas workers, to be
known as the Philippine Overseas Workers Bank, to augment their income-generation
capabilities as investors thereof. Added to this, it enjoins the government to provide necessary
financial assistance that will tremendously sustain the viability of the proposed Bank,

It is about time that the overseas workers be provided with a bank that they can call their
own; effectively run and managed by people within their ranks; and which is expected to be
operated for their greater good and benefit, Our so-called modern day heroes will surely gain the
added aspiration to work even harder in the foreign countries they now consider as the places of
their “bread and honey”. But more importantly, it is a fitting recognition of their contribution in
the long and arduous task at nation building.

In view of the foregoing, passage of this bill is earnestly sought.

REP. LANI MERCADO-REVILLA
2™ District, Cavite


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

SIXTEENTH CONGRESS
First Regular Session

House pitt No, 1491

Introduced by HONORABLE LANI MERCADO-REVILLA

AN ACT
CREATING THE PHILIPPINE OVERSEAS WORKERS BANK, AND FOR
OTHER PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:

Section 1. Overseas Workers Bank ~ There is hereby created a Bank to be known as the

“Philippine Overseas Workers Bank,” hereinafter referred to as the “Bank.”

See. 2. Place of Business: Branches, Agencies and other offices ~ The Bank’s principal
office and place of business shall be in the National Capital Region, also known as Metro
Manila. It may open and maintain other branches, agencies, and other offices at such places in
the Philippines or abroad as its Board of Directors may deem advisable, with prior approval of

the Monetary Board of the Bangko Sentral ng Pilipinas,

Sec. 3. Corporate Powers and Functions. — The Bank shall be a corporate body and

shall have the following powers and purposes:

To grant loans and other financial assistance preferably to
Filipino overseas workers, their spouses, or compulsory heirs,
for the ‘development of agriculture and small and medium
scale commercial and industrial enterprises;

b. To grant loans and other financial assistance to Filipino
workers applying or reapplying for overseas employment to
defray the payment of placement fees and other expenses

thereof:


c. To enter into agreements or contracts for such services and aid,
as may be needed for the proper, efficient and stable
administration of the Bank:

d. To accept and administer trust and to carry on a general trust
business;

¢. To acquire property, real or personal, which may be necessary
or expedient for the proper conduct of its operation;

f To acquire, receive, or hold by way of purchase or otherwise,
public or private property for the purpose of undertaking
housing projects preferably for the benefit of Filipino overseas
workers, their spouses or compulsory heirs;

2. To receive deposits and accept property, real or personal, as
collateral or security; and

h. To adopt, amend or change its by-laws; to adopt, alter and use

a seal; to sue or be sued; and to exercise the general powers of

a corporation provided in Batas Pambansa Blg. 68,
otherwise known as the "Corporation Code of the Philippines,"
and the powers of the bank of its category under the General

Banking Act.

Sec. 4, Determination of Overseas Workers.-For purposes of this Act, the overseas
workers referred to herein shall include any person or persons who have served or serving as an
. which shall

employee or worker outside the Philippines under a valid employment cont
include seamen and employees or workers on board vessels plying international waters, name
hires, and other workers whose contracts of employment involve the rendering of services in a

foreign country, whether as laborers, office workers or professional employees.

Sec. 5. Authorized Capital Stock-The Capital Stock of the bank shall be Two billion
pesos (P2,000,000,000.00) divided into two million (2,000,000) shares with a par value of One
thousand pesos (P1,000.00) per share. Fifty one percent (51%) of the total shares provided
herein, ot one billion one hundred million (1,100,000,000.00) shall be common shares, while the
remaining forty nine percent (49%) or nine hundred million (900,000,000) shares shall be

preferred.

The Government of the Republic of the Philippines shall, on behalf of the overseas

contract workers, fully subscribe to the total common shares of the bank. The amount necessary


for the government's subscription shall be advanced by the Overseas Welfare Administration
(OWWA): Provided That, the National Government shall, within a period of three (3) years,
return to OWWA the amount herein before mentioned: Provided further, that OWWA shall hold
and represent the shares corresponding to the amount it has advanced until it shall have been

fully reimbursed from the sale of the stocks subscribed by the national government in favor of

See. 6. Authorized Loans and Investments. -In the exercise of its lending authority, the
Bank shall give preference and priority to loans for agricultural and small medium scale
commercial and industrial enterprises particularly for overseas workers, their spouses or
compulsory heirs.

Unless otherwise provided in this Act, loans and other credit accommodations granted by

the bank shall be subject to the appropriate applicable loan limits to any single borrower as

provided under Republic Act No. 337, as amended, otherwise known as the General Banking
Act.

The authority of the Bank to invest in equities of allied undertakings, financial or non-
financial, as well as in non-allied undertakings shall be governed by the provisions of Republic

Act No. 337, as amended,

Sec. 7. Board of Directors; Composition; Tenure and Per Diem-Within the first three
(3) years from the organization of the bank, the affairs and business of the bank shall be directed
and its properties managed and preserved and its corporate powers exercised, unless otherwise
provided in this Act, by a Board of Directors consisting of eleven (111) members, composed of

fficio Chai

the Secretary of Labor and Employment as ex~ nan, the Chairman of the Senate and

House of Representatives Committee on Labor and Employment, the Administrators of the
stration (POEA) and Overseas Workers Welfare

Philippine Overseas Employment Admi
‘Administration (OWWA) as ex-officio members, and the remaining members shall be selected

from the officers of the different overseas workers associations and be appointed by the President

of the Philippines: Provided, That, at least one-(I) member shall be ordinary overseas worker:

Provided further, That one (1) member each shall come from Visayas and Mindanao.

Thereafter, the members of the Board of Directors shall be elected annually by the
stockholders in the manner prescribed by the Corporation Code: Provided, That no director,
officer or employee of any other bank shall be eligible as member of the Board of Directors:
Provided further, That no less than six (6) of the members thereof are overseas workers. Unless

otherwise set by the Board, members of the Board shall receive a per diem allowance of One


Thousand Pesos (P1,000.00) for every meeting of the Board actually attended by them: Provided,
finally, That the total amount per diems for single month shall not exceed the sum of Six
Thousand Pesos (P6,000.00).

The Board of Directors shall, upon a majority of all its members, elect its Chairman,
Vice-chairman and other officers. Pending the election of the Chairman, the President of the

Bank shall preside over the Board of Directors.

Sec. 8. Election and Qualifications Of Members of the Board of Directors, - Annually
on the first Tuesday in March after the transition period of three (3) years mentioned in this Act,
the stockholders shall meet to elect the members of the Board of Directors for the current year.

Each stockholder or proxy will be entitled to as many votes as he may have shares of stock

registered in his name and held by him one (1) week prior to the date of the election multiplied
by the number of directors to be elected. In the election of the members of the Board,

stockholders shall have the right of commutative voting as recognized by law.

No person shall be elected director of the Bank unless he is a natural-born citizen of the
Philippines, not less than thirty five (35) years of age, of good moral character and has attained
proficiency, expertise and recognized competence in one (1) or more of the following overseas
employment promotions and recruitment, banking, finance, economics, law or business

management,

See. 9. Power of the Board of Directors - The Board of Directors shall have, among

others, the following duties, powers and authority’

a) To formulate policies necessary to carry out effectively the

provision of this Act;
ich rules

b) To adopt, amend or change the by laws as well as si

and regulation as may be necessary for the effective operation

of the Bank, in conformity with this Act and existing laws;
©) To prescribe such terms and condition fo govern the granting of
loans credits, consistent with the provision of this Act;

d) To adopt an annual budget for the effective operation and

administration of the Bank;
) To create, establish and operate a "Self-Insurance System" in

order to offset possible damage or loss of cash-in-transit that


the Bank may suffer which may arise, among others, from
irregular transfers and similar instruments, or losses arising
from other forms and frauds;

f) To create and establish a Provident Fund for the benefit of its
officers or employees under such terms and conditions as the
Board of Directors may fix;

g) To compromise or release, in whole or in part, any claim,
liability or demand for or against the Bank; regardless of the
amount involved, under such terms and conditions as it may
impose to protect the interest of the Bank;

h) To provide for the appointment and removal, as will fix
reasonable compensation, for its personnel in accordance with
existing laws;

i) To determine the procedure and requirements for the
acquisition of properties necessary for the business of the bank;

j) To dispose of properties of the Bank, whether used in the
conduct of its business or acquired as a result of its banking
operations, by public bidding or private negotiations; and

k) To perform such other functions as may be necessary to

achieve the objective of this Act.

‘The Board shall meet as frequently as necessary and the presence of five (5) members

shall constitute a quorum.

Sec. 10, President of the Bank - The Chief Executive Officer of the Bank shall be the
President who shall be clected by the Board of Directors from among themselves. No person
shall be elected President of the Bank unless he is at least forty (40) years of age, of good moral
character and reputation, with at least at ten (10) years previous expertise and recognized

competence in banking or financial management, and must have had experience as an overseas

‘The President of the Bank shall, among other powers and duties, executive and
administer the policies, measure, orders and resolution approved by the Board of Directors, and

direct and supervise the operations and administration of the Bank. Particularly, he shall have the

power and duty

and to enter into all authorized

a) To execute all contracts

transactions in behalf of the Bank;


b) To exercise, as Chief Executive Officer, the power of
supervision and control over decisions or actions of
subordinate officers and all other powers that may be granted
by the Board;

c) To recommend to the Board the appointment, promotion or
removal of all officers of the Bank, including those with the
rank of at least Vice-president or its equivalent;

d) To appoint, promote or remove employees and officer below
the rank of Vice-President;

e) To transfer, assign or reassign officers and personnel of the

Bank in the interest of the services;

f) To report periodically to the Board of Directors on the
operations of the Bank: and

g) To delegate any of his powers, duties or functions to any
official of the Bank, with the approval of the Board of

Directors.

Sec. 11. Other Officers and Employees. - The Board of Directors shall provide for an
organization and staff of officers and employees of the Bank and upon recommendation of the

President of the Bank, fix their remuneration and other emoluments.

No officer or employee of the Bank subject to Civil Service Law shall be dismissed or

suspended except as prided by law.

See. 12. Legal Matters and Cases. - The Bank shall have its own Legal Department, the
head of which shall be appointed by the Board of Directors of the Bank upon the

recommendation of the President of the Bank.

The Bank may, subject to court approval, deputize any member of its legal staff to act as

Special Sheriff in the enforcement of court writs and processes in cases involving the Bank.

Sec. 13. Bank Auditor - The Commission on Audit shall be ex-officio auditor of the

Bank and shall designate a representative to the Bank.

Sec. 14. Examination of the Bank - The Bank shall be subject to supervision and

examination by the appropriate department of the Bangko Sentral ng Pilipinas.


Sec. 15. Inhibition front Board Meeting of Member with personal Interest.
Whenever any member attending a meeting of the Board of Directors has a personal interest

directly or indirectly, in the discussion or resolution of any given matter, said member shall not

participate in the discussion or resolution of the matter and must retire from the meeting during

the deliberation thereon,

See. 16. Prohibition on Officers and Employees of the Bank. - Except as required by
law, or upon order of a court of competent jurisdiction, or express order of the President of the
Philippines, or written permission of the client, no officer or employee of the Bank shall reveal
to, nor allow to be examined, inquired or looked into by any information relative to details on
individual accounts or specific banking transactions: Provided, That in respect to deposits of

whatever nature, the provisions of any existing laws shall apply.

This provision shall not apply to the exchange of confidential credit information among

government financial in

itutions or among banks, in accordance with established banking

practices or as maybe allowed by law.

See. 17, Borrowings of Directors, Offices and Employees. - No director, officer or
employee of the Bank or any corporation, partnership or company wherein any member of the
Board of Directors, officer or employees, and/or their respective relatives within the second
degree of consanguinity or affinity, is a director, officer or controlling share holder, shall either
directly or indirectly, for himself or as representative or agent of others, borrow any of the
deposits of funds from the Bank, nor shall he become a guarantor, endorser or surety for loans
from the Bank to others, or in any manner be an obligor for money borrowed from the Bank or
loaned by it: Provided, That this prohibition or loans to directors, officers and employees shall
not include loans in the form of fringe benefits granted in accordance with rules and regulations

as maybe prescribed by the Monetary Board of the Bangko Sentral ng Pilipinas.

The Bank shall not grant, directly or indirectly, any loans or credit accommodations to

the head or to any officer or personnel directly exercising supervisory or regulator

authority
over the activities of the Bank such as those of the Bangko Sentral ng Pilipinas or Commission

on Audit.

Sec, 18, Disposal of Real Estate and Other Properties. - Real and other properties

acquired by the bank in the collection of debts, receivables by way of foreclosure or other means


shall be sold or otherwise disposed of in accordance with the policies and guidelines adopted by

the Board of Directors within (3) years after date of their acqui

Sec. 19. Right of Redemption of Foreclosed Property and Proc

sion During
Redemption Period, - Within one (1) year from the registration of the foreclosure sale or real
property, the mortgagor shall have the right to redeem the property by paying the principal,
interest, charges, commissions and all claims of whatever nature of the Bank outstanding and

dues s incurred by reason of the

to the date of the sale including all the cost and other expens

foreclosure sale and custody of the property, as well as charges and accrued interests.

‘The Bank may take possession of the foreclosed property during the redemption period.
When the Bank takes possession during such period, it shall be entitled to the fruits of property
with no obligation to account for the same compensation being considered for the interest that
would otherwise accrue on the account. Neither the Bank be obliged to post a bond for the

purpose of such possession.

Sec. 20. Depository of Overseas Workers Funds. - The provisions of the existing laws
to the country notwithstanding, the bank shall act as official government depository with
authority to maintain deposits of the government, particularly with respect to funds intended for
or due to overseas workers, subject to rules and regulations as the Monetary Board of the Bangko

Sentral ng Pilipinas may prescribe.

Sec, 21. Tax and Duty Exemptions. - The bank shall be exempted from the payment of
all kinds of taxes and duties imposed by the Government, or any subdivision, agency or
instrumentality thereof, on any of its income, real or personal property acquisitions, or
importation or equipment, machinery and other items as maybe needed in its operations, within a

period of five (5) years from the date of the establishment of the Bank.

See, 22. Term - The legal existence of the bank under this Act shall be for a period of

fifty (50) years, from and after the date of the approval of this Act.

Sec. 23. Articles of Incorporation of Charter, - This Act, upon its approval, shall be
deemed and accepted for all legal intents and purposes as the statutory articles of incorporation
or charter of the Philippine Overseas Workers Bank. Pursuant thereto, the bank shall be deemed
registered and duly authorized to do business and operate as a commercial Bank as of the date of

approval of this Act.


Sec. 24. By-laws. - The by-laws of the Bank for its organizational, functional, and
operational government and procedures shall be adopted by the affirmative vote of the stock

holders representing a majority of all the subscribed capital stock and title to vote within one (1)

month after the approval of this Act. The said by-laws shall be subject to certifications by the

Monetary Board pursuant to the provisions of the Republic Act No. 337, as amended.

Sec. 25. Penalties. - Any director, officer, or employee of the Bank who violates or
knowingly permits the violation and any person aiding or abetting any violations of any of the
provisions of this Act, shall be punished by a fine not to exceed Ten thousand pesos
(P10,000.00) or by imprisonment of not more than five (5) years or both such fine and

imprisonment,

Sec. 26, Separability Clause. - If any provision or part of this Act or the application

thereof to any person, association or circumstances is held invalid, the other pertinent provision
or part of this act and their application to such person, association or circumstances shall not be

affected thereby,

Sec. 27. Repealing Clause. - All other laws, decrees, Acts, executive orders,
proclamations, rules and regulation or parts thereof inconsistent with any of the provisions of this
Act are hereby repealed, amended or modified accordingly.

Sec. 28. Effectivity. -This Act shall take effect within fifteen (15) days from its

publication in the Official Gazette or in a newspaper of general circulation.

Approved,