THIRTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
SENATE 
INTRODUCED BY HON. MANUEL B. VILLAR, JR. 
EXPLANATORY NOTE 
Undeniably, the contribution of Filipino overseas workers in the country's thrust for 
economic recovery has proven to be both vital and indispensable. Since the 1970s, labor export 
had 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 who 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. 
. 
Hailed as modern day heroes, Filipino overseas workers have been considered as one of 
the major forces in the labor front today. Considering their number, which is estimated at close to 
1.5 million, excluding workers who have acquired immigrant status in their host countries, they 
have greatly influenced government policies geared towards promoting and protecting their 
welfare and interests. 
In the area of investment, the government has only the establishment of the Overseas 
Workers Investment Fund to offer for the overseas workers to invest their funds with. 
This bill seeks to further enhance the investment potential 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 the necessary financial assistance 
that will tremendously sustain the validity of the proposed bank. 
It is about time that the overseas workers be provided with a bank that they can call their 
own; effectively nin and managed by people within their ranks, and which is expected to be 
operated for their greater good and benefit. 
To help our overseas Filipino workers, the passage of this bill is urged. 


THIRTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
4
-
 
SENATE 
s. No. 
639 
INTRODUCED BY HON. MANUEL B. VILLAR, JR. 
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 
assem bled: 
SECTION I. Overseas Workers Bank.--There is hereby created a Bank to be known as the 
"Philippine Overseas Workers Bank," hereinafter referred to as the "Bank. 'I 
SEC. 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: 
a. To grant loans and other financial assistance preferably to Filipino overseas workers, 
their spo~ises, 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: 
e. 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; 
g. To receive deposits and accept property, real or personal, as collateral or security; and 
11. 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 as 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 
employee or worker outside the Philippines under a valid employment contract, which shall 
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--TIie 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,OOO.OO) per share. Fifty one percent (51%) of the total shares provided 
herein, or 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, fklly 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 coiresponding to the amo~int it has advanced until it shall have been fully 
reimbursed from the sale of the stocks subscribed by the national government in favor of 
overseas contract workers. 
SEC. 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; Con 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 (1 1) members, 
composed of the Secretary of Labor and Employment as ex-officio Chairman, the Chairman of 
the Senate and House of Representatives Committee on Labor and Employment, the 
Administrators of the Philippine Overseas Employment Administration (POEA) and Overseas 
Workers Welfare 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-( 1) 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 
ftirther, 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,OOO.OO) 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,OOO.OO). 
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 and/or business 
management. 
SEC. 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; 
b) To adopt, amend or change the by laws as well as such rules and regulation as may be 
necessary for the effective operation of the Bank, in conformity with this Act and existing laws; 
c) To prescribe such terms and condition to 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; 
e) 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, fiom 
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, 
IC) 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 elected 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 (1 0) years previous expertise and recognized 
competeiice in banking or financial management, and must have had experience as an overseas 
worker. 
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: 
a) 
To execute all contracts and to enter into all authorized 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> 
services; 
To transfer, assign or reassign officers and personnel of the Bank in the interest of the 
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. 
SEC. 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 Banglto 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. 


SEC. 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 taws shall apply. 
This provision shall not apply to the exchange of confidential credit information among 
government financial institutions or among banks, in accordance with established banking 
practices or as maybe allowed by law. 
SEC. 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 regulatory 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 acquisition. 


P 
SEC. 19. Right of Redemption of Foreclosed Property and Procession 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 to the date of the sale including all the cost and other expenses incurred by reason of the 
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 h i t s  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 the property with no 
obligation to account for them, the same being considered compensation 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 Banglto 
Seiitral 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. 
SEC. 22. Tern -- 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. 


*I 
i 
i 
L 
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, whether paid 
or unpaid, 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,OOO.OO) 
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.