FIFTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
) 
) 
) 
First Regular Session 
SENATE 
S. B. No. 2742 
Introduced by Senator Ralph G. Recto 
Explanatory Note 
'11 
MAR lOP 3 :53 
J 
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 in 1993 to replace the old 
one, which was in effect as early as 1948. While the old Central Bank law - Republic Act 265 -
was amended four times during its lifetime, the new law or RA No. 7653 has never been changed in 
its 17 years of effectivity. 
It is therefore imperative that RA 7653 - the law t,hat created the present Bangko Sentral ng 
Pilipinas (BSP) - be' revisited and amended accordingly to respond to the changing times. The 
prevailing situation 17 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 morp effective. 
, 
This bill aims to amend the BSP charter to strengthen the institution and plug the supposed 
gaps and loopholes which the present law's authors failed ~o anticipate 17 years ago. 
" 
One of the most important amendments of this proposed measure is to incorporate the 
promotion of full employment as 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 significa,nt and positive effects on the country's 
economic and financial development. It will also affirm the State's mandate to make labor a 
primary social economic force. 
Other salient provisions of the bill include the following: 
• 
Establishing a mechanism for the full payme~t of the national government's unpaid 
subscription to the BSP as mandated by RA 7653. 
• 
Expanding the BSP's supervisory powers to include credit card companies, e-money issuers, 
remittance agents and institutions performing similar functions. 
• 
Deletion of the provision requiring theconfi,rmation of the BSP Governor by the 
Commission on Appointments. 


• 
Proposing that no member of the Monetary Board, including the BSP governor and vice 
governors, shall be elected as director, or emplQyed 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 video conferencing or 
teleconferencing, as required by circumstances. 
• 
Increasing the number of deputy governors from tliree (3) to five (5). 
• 
Semi-annual appearance before key committees in both houses of Congress. 
Other key features of the bill include amendmenls 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 thf( 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. 
" 


FIFTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
First Regular Session 
SENATE 
" 
S. B. No. 2 7 4 2 
) 
) 
) 
Introduced by Senator Ralph G. Recto 
AN ACT 
'11 
MAR 10 P3:53 
'ILT""' ";"') my.-@-
~. t', ,c." 
11-
~ ,~. 
f.~ 
• 
_ 
, 
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" 
Be it enacted by the Senate and the House of Representatives of the Philippines in Congress 
assembled: 
1 
SECTION 1. Section 2 of Republic Act No. 7653 is hereby amended to read as follows: 
2 
"SEC. 2. Creation of the Bangko Sentrai. -
There is hereby established an 
3 
independent central monetary authority, which shall be a body corporate known as the 
4 
Bangko Sentral ng Pilipinas, hereafter referred to as the Bangko Sentral. The capital of 
• 
5 
the Bangko Sentral shall be Fifty Billion Pesos (P50,000,000~000), to be fully 
6 
subscribed by the Government of the Republic, hereafter referred to as the 
7 
Government, Ten Billion Pesos (PI 0,000,000,000)' of which shall be fully paid for by 
8 
the Government upon the effectivity of this Act [and the balance to be paid for within 
9 
two (2) years from the effectivity of this Act in such manner and form as the 
10 
Government, through the Secretary of Finance' and the Secretary of Budget and 
11 
Management, may thereafter determine]. THE BALANCE SHALL BE PAID FOR 
, 
12 
IN CASH AVAILABLE TO THE GOVERNMENT OR THROUGH THE 
13 
ISSUANCE OF READILY MARKETABLE GOVERNMENT SECURITIES OF 
14 
EQUIVALENT MARKET VALUE TO THE BALANCE OF THE UNPAID 
15 
SUBSCRIPTION OF THE GOVERNMENT TO THE BANGKO SENTRAL: 
16 
PROVIDED, THAT THE CASH OR GOVERNMENT SECURITIES ISSUED 
17 
PURSUANT HERETO ARE HEREBY AUTHORIZED AND SHALL BE 
18 
DEEMED AUTOMATICALLY APPROPRIATED FOR THE PURPOSE OF 
19 
ENABLING THE GOVERNMENT TO COMPLY WITH ITS OBLIGATION 
20 
TO PAY FOR ITS UNPAID SUBSCRIPTION TO THE BANGKO SENTRAL." 
21 
SEC. 2. Section 3 of Republic Act No. 7653 is hereby amended to read as follows: 
22 
"SEC. 3. Responsibility and Primary Objective. -
The Bangko Sentral shall 
23 
provide policy directions in the areas of money, banking, and credit. It shall have 
24 
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 
1 


1 
and non-bank financial institutions performing quasi-banking functions, hereafter 
2 
referred to as quasi-banks, INCLUDING CREDIT CARD COMPANIES, E-
3 
MONEY ISSUERS, REMITTANCE AGENTS and institutions performing similar 
4 
functions REGULATED BY THE BANGKO SENTRAL UNDER THIS ACT OR 
5 
UNDER SPECIAL LAWS. 
6 
[The primary objective of the Bangko Sentral is to maintain price stability 
7 
conducive to a balanced and sustainable growth of the economy.] IN THE 
~ 
8 
FORMULATION OF MONETARY POLICY, THE BANGKO SENTRAL 
, 
9 
SHALL PROMOTE AND ADVANCE THE'PRIMARY GOALS OF FULL 
10 
EMPLOYMENT AND PRICE STABILITY CONDUCIVE TO A BALANCED 
, 
11 
AND SUSTAINABLE GROWTH OF THE ECONOMY. It shall also promote and 
12 
maintain monetary stability and the convertibility of the peso." 
• 
13 
SEC. 3. Section 6 of Republic Act No. 7653 is hereby amenped to read as follows: 
14 
"SEC. 6. Composition o/the Monetary Board. -
The powers and functions of the 
15 
Bangko Sentral shall be exercised by the Bangko' Sentral Monetary Board, hereafter 
16 
referred to as the Monetary Board, composed of seven (7) members appointed by the 
17 
President of the Philippines for a term of six (6) years. 
18 
The seven (7) members are: 
19 
(a) the Governor of the Bangko 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 
appointment shall be subject to confirmation by the Commission on Appointments.] 
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 
AS AN ALTERNATE TO THE GOVERNOR SHALL BE CONSIDERED IN 
25 
DETERMINING THE QUORUM BUT SAID ALTERNATE, WHILE ENTITLED 
26 
TO BE HEARD, SHALL HAVE NO RIGHT TO VOTE: Provided, HOWEVER, That 
, 
27 
in [such event,] THE ABSENCE OF THE GOVERNOR AT THE MEETING OF 
28 
THE BOARD, the Monetary Board shall designate one of its members as acting 
29 
Chairman; 
30 
(b) a member of the Cabinet to be designated by the President of the Philippines. 
31· 
Whenever the designated Cabinet Member is unable to attend a meeting of the Board, he 
32 
shall designate an Undersecretary in his Department to attend as his alternate WHOSE 
33 
ATTENDANCE AT THE MEETING OF THE BOARD SHALL BE CONSIDERED 
34 
IN DETERMINING A QUORUM BUT SAID M,TERNATE, WHILE ENTITLED 
35 
TO BE HEARD, SHALL HAVE NO RIGHT TO VOTE; and 
36 
(c) five (5) members who shall come from 'the private sector, all of whom shall 
37 
serve full-time: Provided, however, That of the ,members first appointed under the 
38 
provisions of this subsection, three (3) shall have a term of six (6) years, and the other two 
39 
(2), three (3) years. No member of the Monetary Board may be reappointed more than 
• 
40 
once." 
2. 
" 


1 
SEC. 4. Section 9 of Republic Act No. 7653 is hereby amended to read as follows: 
, 
2 
"SEC. 9. Disqualifications. -
In addition. to the disqualifications imposed by 
3 
Republic Act No. 6713, a member of the Monetary Board is disqualified from being a 
'. 
4 
director, officer, employee, consultant, lawyer, agent or stockholder of any bank, 
5 
quasi-bank or any other institution which is subject to supervision or examination by 
6 
the Bangko Sentral, in which case such member shall resign from, and divest himself 
7 
of any and all interests in such institution before assumption of office as member of the 
8 
Monetary Board. 
9 
The members of the Monetary Board coming from the private sector shall not 
10 
hold any other public office or public employment during their tenure. 
11 
No person shall be a member of the Monetary Board if he has been connected 
12 
directly with any [multilateral] banking or finan~ial institution or has a substantial 
13 
interest in any private bank in the Philippines, within one (I) year prior to his 
14 
appointment [; likewise, no member of the Monetary Board shall be employed in any 
, 
15 
such institution within two (2) years after the expiration of his term except when he 
16 
serves as an official representative of the Philippine Government to such institution]. 
17 
NO 
MEMBER OF THE MONETARY' BOARD, 
INCLUDING THE 
18 
GOVERNOR AND ANY DEPUTY GOVERNOR OF THE BANGKO SENTRAL 
19 
SHALL BE ELECTED AS DIRECTOR, OR EMPLOYED AS OFFICER OR 
20 
EMPLOYEE, OR HIRED AS CONSULTANT, ADVISER, LAWYER OR IN 
21 
OTHER CONTRACTUAL CAPACITY OF ANY BANK, QUASI-BANK, 
, 
22 
FINANCE COMPANY, NON-BANK FINANCIAL INTERMEDIARY, OR IN 
23 
SIMILAR 
CAPACITIES 
IN 
OTHER 
JNSTlTUTlONS 
THAT 
ARE 
24 
SUPERVISED/REGULATED BY THE BANGKO SENTRAL WITHIN THREE 
25 
(3) YEARS AFTER THE EXPIRATION OF THEIR RESPECTIVE TERMS OF 
26 
OFFICE OR AFTER ANY OF SUCH OFFICIALS RETIRES OR RESIGNS 
27 
FROM THEIR RESPECTIVE POSITIONS 'IN THE ·BANGKO SENTRAL 
28 
EXCEPT WHEN ANY OF SUCH OFFICIALS IS APPOINTED OR 
, 
29 
DESIGNATED AS AN OFFICIAL REPRESENTATIVE OF THE PHILIPPINE 
30 
GOVERNMENT IN A MULTILATERAL OR INTERNATIONAL FINANCIAL 
31 
INSTITUTION." 
32 
SEC. 5. Section II of Republic Act No. 7653 is hereby amended to read as follows: 
33 
"SEC. II. Meetings. - The Monetary Board shall meet at least once a week. 
, 
34 
The Board may be called to a meeting by the Governor of the Bangko Sentral or by 
35 
two (2) other members of the Board. 
36 
The presence of four (4) members shall constitute a quorum: Provided, That in 
37 
all cases the Governor or his duly designated alternate shall be among the four (4) .. 
3 


1 
Unless otherwise provided in this Act, ali decisions of the Monetary Board 
2 
shall require the concurrence of at least four (4) members. 
3 
THE MEETING OF THE MONETARY BOARD, AS REQUIRED BY 
4 
CIRCUMSTANCES, 
MAY 
BE' 
'CONDUCTED 
THROUGH 
5 
TELECONFERENCING OR VIDEO CONFERENCING SUBJECT TO PRIOR 
6 
NOTICE TO ALL THE MEMBERS OF THE BOARD OF THE CALL FOR 
7 
SUCH METHOD OF CONFERENCING AND SUBJECT FURTHER TO THE 
8 
REQUIREMENT THAT THE CHAIRMAN OF THE BOARD OR THE 
9' 
ALTERNATE 
PRESIDING 
OFFICER 
IS 
PHYSICALLY 
PRESENT, 
10 
TOGETHER WITH THREE (3) OTHER MEMBERS OF THE BOARD, AT 
11 
THE DESIGNATED VENUE OF THE MEETlI'IG. 
12 
THE 
GOVERNOR SHALL VOTE, AT MEETINGS 
OF THE 
• 
13 
MONETARY BOARD SUBJECT TO THE qMITATIONS OF SECTION 14 
14 
(WITHDRAWAL DUE TO PERSONAL OR PECUNIARY INTEREST) 
, 
15 
HEREIN. EACH AND EVERY VOTE OF THE GOVERNOR AND THE 
16 
MONETARY BOARD MEMBERS, BE IT IN THE AFFIRMATIVE, 
• 
17 
NEGATIVE OR ABSTENTION, SHOULD BE REFLECTED IN THE 
18 
MINUTES OF THE MEETING. 
0, 
19 
The Bangko Sentral shall maintain and preserve a complete record of the 
20 
proceedings and deliberations of the Monetary Board, including the tapes and 
21 
transcripts of the stenographic notes[, either] in their original form, [or] in microfilm 
22 
OR IN OTHER RECORDING MEDIA." 
23 
SEC. 6. Section 12 of Republic Act No. 7653 is hereby amended to read as follows: 
24 
"SEC. 12. Attendance of the Deputy Governors. -
The Deputy Governors 
25 
[may] SHALL, UPON THE ORDER OF THE GOVERNOR OR THE 
26 
MONETARY BOARD, attend the meetings of the Monetary Board with the right to 
27 
be heard. OTHER OFFICIALS OF THE BANGKO SENTRAL MAY BE 
28 
DIRECTED TO ATTEND THE MONETARY BOARD MEETINGS UPON 
29 
INVITATION OF THE MONETARY BOARD, ON A PER MEETING BASIS IF 
30 
THEIR EXPERTISE IS NEEDED IN A PARTICULAR AGENDA OR 
31 
MATTER." 
32 
SEC. 7. Section 15 of Republic Act No. 7653 is hereby amended to read as follows: 
33 
"SEC, 15. Exercise of Authority, -
In the exercise of its authority, the 
34 
Monetary Board shall: 
35 
(a) issue rules and regulations it considers necessary for the effective discharge 
36 
of the responsibilities and exercise of the powers vested upon the Monetary Board and 
• 
37 
the Bangko Sentral. The rules and regulations isstied shall be reported to the President 
38 
and the Congress within fifteen (15) days from the:date of their issuance; 
4 


1 
ANY ISSUANCE THAT AFFECTS THlRD PARTIES OR IMPOSES A 
2 
PENALTY 
OR 
SANCTION 
AGAINST 
THE 
INSTITUTIONS 
3 
SUPERVISED/REGULATED BY THE BANGKO SENTRAL OR THEIR 
, 
4 
DIRECTORS OR OFFICERS SHALL, BEFORE ITS ISSUANCE, BE 
5 
SUBJECT TO PUBLIC HEARINGS OF THE PARTIES AND INSTITUTIONS 
" 
6 
TO BE AFFECTED. 
7 
NO RULES AND REGULATIONS SHALL BECOME EFFECTIVE 
" 
8 
UNLESS PUBLISHED IN TWO (2) NEWSPAPERS OF NATIONAL 
9 
CIRCULATION; 
10 
(b) direct the management, operations, and administration of the Bangko 
11 
Sentral, reorganize its personnel AND IN CONNECTION THEREWITH 
12 
PROVIDE SEPARATION BENEFITS AS DEEMED APPROPRIATE, and issue 
13 
such rules and regulations as it may deem necessary or convenient for this purpose. 
14 
[The legal units of the Bangko Sentral shall be under the exclusive supervision and 
15 
control of the Monetary Board;] 
16 
THE MONETARY BOARD SHALL ESTABLISH A LEGAL UNIT 
17 
UNDER ITS EXCLUSIVE SUPERVISION AND CONTROL THAT SHALL 
18 
ASSIST THE MONETARY BOARD IN, ITS, POLICY FORMULATION, IN 
19 
THE PROMULGATION OF IMPLEMENTING RULES AND REGULATIONS 
20 
AND IN REVIEWING THE LEGAL ASPECT OF MEASURES INCLUDED IN 
21 
THE AGENDA OF THE MEETINGS OF THE MONETARY BOARD; 
22 
(c) establish a human resource management system which shall govern the 
23 
selection, hiring, appointment, transfer, promotion, or dismissal of all personnel. Such 
24 
system shall aim to establish professionalism and excellence at all levels of the Bangko 
25 
Sentral in accordance with sound principles of management. 
" 
26 
A compensation structure, based on job evaluation studies and wage surveys 
, 
27 
and subject to the Board's approval, shall be instituted as an integral component of the 
28 
Bangko Sentral's human resource development program: 
Provided, That the 
29 
Monetary Board shall make its own system conform as closely as possible with the 
30 
principles provided for under Republic Act No. 6758[: Provided, however, That 
" 
31 
compensation and wage structure of employees, whose positions fall under salary 
32 
grade 19 and below shall be in accordance with the rates prescribed under Republic 
" 
33 
Act No. 6758]. 
34 
On the recommendation of the Governor, appoint, fix the remunerations and 
35 
other emoluments, and remove personnel of the Bangko Sentral, subject to pertinent 
36 
civil service laws: Provided, That the Monetary Board shall have exclusive and final 
37 
authority to promote, transfer, assign, or reassign personnel of the Bangko Sentral and 
38 
these personnel actions are deemed made in the interest of the service and not 
5 


1 
disciplinary: Provided,Jurther, That the Monetary Board may delegate such authority 
2 
to the Governor under such guidelines as it may determine. 
3 
(d) adopt an annual budget for and authorize such expenditures by the Bangko 
4 
Sentral as are in the interest of the effective a~ministration and operations of the 
5 
Bangko Sentral in accordance with applicable laws and regulations; and 
6 
(e) indemnify its members and other officials of the Bangko Sentral, including 
7 
personnel [of the departments] performing supervision and examination functions, 
, 
8 
CREDIT AND MONETARY POLICY OPERATIONS against all costs and 
9 
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 
performance of his functions or duties, unless he is finally adjudged in such action or 
12 
proceeding to be liable for BAD FAITH, MALICE, negligence or misconduct. 
13 
In the event of a settlement or compromise, indemnification shall be provided 
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 
16 
commit any] HAD NOT ACTED WITH BAD' FAITH, MALICE, negligence or 
17 
misconduct. 
, 
18 
The costs and expenses incurred in defending the aforementioned action, suit or 
19 
proceeding may be paid by the Bangko Sentral in advance of the final disposition of 
• 
20 
such action, suit or proceeding upon receipt of all undertaking by or on behalf of the 
21 
member, officer, or employee REFERRED TO IN SUBSECTION (E) to repay the 
, 
22 
amount advanced should it ultimately be determined by the Monetary Board that he is 
23 
not entitled to be indemnified as provided in this subsection ON ACCOUNT OF 
24 
BAD FAITH, MALICE, NEGLIGENCE OR MISCONDUCT." 
25 
SEC. 8. Section 16 of Republic Act No. 7653 is hereby amended to read as follows: 
26 
"SEC. 16. 
Responsibility. -Members ,of the Monetary Board, officials, 
27 
examiners, and employees of the Bangko Sentral who willfully violate this Act or who 
28 
are guilty of negligence, abuses or acts of malfeasance or misfeasance or fail to 
29 
exercise extraordinary diligence in the performance of his duties shall be held liable 
30 
for any loss or injury suffered by the Bangko Sentral or other banking institutions as a 
31 
result of such violation, negligence, abuse, malfeasance, misfeasance or failure to 
32 
exercise extraordinary diligence. 
33 
Similar responsibility shall apply to lhemDers, officers, and employees of the 
34 
Bangko Sentral for: (1) the disclosure of any info,rmation of a confidential nature, [or 
35 
any information on the discussions or resolutions Of the Monetary Board,] or about the 
36 
confidential operations of the Bangko Sentral, unless the disclosure is in connection 
37 ' 
with the performance of official functions with the Bangko Sentral, or is with prior 
38 
authorization of the Monetary Board or the Governor; or (2) the use of such 
6 


l' 
information for personal gain or to the detriment of the Government, the Bangko 
2 
Sentral or third parties: Provided, however, That any data or information required to be 
3 
submitted to the President and/or the Congress, or to be published under the provisions 
4 
of this Act shall not be considered confidential." 
!, 
5 
SEC. 9. Section 17 of Republic Act No. 7653 is hereby amended to read as follows: 
• 
6 
"SEC. 17. Powers and Duties o/the Governor. -
The Governor shall be the 
7 
chief executive officer of the Bangko Sentral. His powers and duties shall be to: 
8 
(a) 
prepare, 
AT 
HIS 
INITIATIVE, 
OR 
UPON 
THE 
9 
RECOMMEN~ATION OF A MEMBER OF 'fHE MONETARY BOARD, the 
10 
agenda for the meetings of the Monetary Board and to submit for the consideration of 
, 
11 
the Board the policies and measures [which he believes] DEEMED to be necessary to 
12 
carry out the purposes and provisions of this Act. THE SUPPORTING 
13 
MEMORANDUM FOR ANY ITEM INCLUDED IN THE AGENDA FOR THE 
14 
MEETINGS OF THE MONETARY BOARD SHALL BE DISTRIBUTED TO 
15 
THE MEMBERS AT LEAST THREE (3) WORKING DAYS BEFORE THE 
• 
16 
SCHEDULED MEETING IN ORDER TO ENABLE THE MEMBERS OF THE 
17 
BOARD TO STUDY, REVIEW, AND EVALUATE EACH AND EVERY ITEM 
18 
INCLUDED IN THE AGENDA; PROVIDED, HOWEVER, THAT IN 
19 
EMERGENCY CASES, PRIOR ONE (1) WORKING DAY BEFORE A 
20 
MEETING SHALL APPLY; 
21 
(b) execute and administer the policies and measures approved by the 
22 
Monetary Board UPON THEIR EFFECTIVITY;, 
23 
(c) direct and supervise the operations and internal administration of the 
24 
Bangko Sentral. The Governor may 
delegat~ IN WRITING certain of his 
25 
administrative responsibilities OR SPECIFIC TASKS to other officers or may assign 
26 
specific tasks or responsibilities to any full-time member of the Monetary Board 
27 
without additional remuneration or allowance whenever he may deem fit SUBJECT 
28 
TO SUCH GUIDELINES AND REPORTORIAL REQUIREMENTS AS HE 
29 
SHALL REQUIRE or subject to such rules and regulations as the Monetary Board 
, 
! 
30 
may prescribe FOR THE DELEGATED AUTHORITY; PROVIDED, HOWEVER, 
, 
31 
THAT A POWER OR AUTHORITY DIRECTLY VESTED BY LAW TO BE 
32 
EXERCISED BY THE MONETARY BOARD UNDER THIS ACT AND/OR 
, 
33 
UNDER ANY OTHER SPECIAL LAW SHALL NOT BE DELEGATED TO BE 
34 
EXERCISED BY THE GOVERNOR OR ANY OTHER EXECUTIVE OFFICER 
• 
35 
OF THE BANGKO SENTRAL, BUT TlJE POWER OR AUTHORITY 
36 
EXERCISED BY THE MONETARY BOARD PURSUANT TO LAW 
, 
37 
THROUGH THE RULES AND REGULATIONS PROMULGATED BY IT, OR 
38 
THE DECISIONS, RULINGS OR ORDERS ISSUED BY THE MONETARY 
39 
BOARD SHALL BE IMPLEMENTED OR EXECUTED BY THE GOVERNOR 
7 


'. 
1 
AND/OR OTHER PERTINENT EXECUTIVE OFFICERS OF THE BANGKO 
2 
SENTRAL; 
3 
(d) appoint and fix the remunerations and other emoluments of personnel 
4 
below the rank of a department head in accordance with the position and compensation 
• 
5 
plans approved by the Monetary Board, as well as to impose disciplinary measures 
6 
upon personnel ofthe Bangko Sentral, subject to the provisions of Section l5(c) of this 
7 
Act: Provided, That removal of personnel shall be with the approval of the Monetary 
8 
Board; AND 
9 
[(e) render opinions, decisions, or rulings, which shall be final and executory 
10 
until reversed or modified by the Monetary Board, on matters regarding application or 
11 
enforcement of laws pertaining to institutions sup.ervised by the Bangko Sentral and 
12 
laws pertaining to quasi-banks, as well as regulations, policies or instructions issued by 
13 
the Monetary Board, and the implementation therepf; and] 
14 
[(f)] (E) exercise such other powers as may be vested in him by the Monetary 
15 ' 
Board." 
16 
SEC. 10. Section 19 of Republic Act No. 7653 is hereby amended to read as follows: 
17 
"SEC. 19. Authority of the Governor in Emergencies. -
In case of 
18 
emergencies where time is insufficient to call a F:ORMAL meeting of the Monetary 
19 
Board, the Governor ofthe Bangko Sentral, with the concurrence of [two (2)] THREE 
20 
(3) other members of the Monetary Board, may decide [any] AN URGENT matter or 
21 
take [any] action [within the authority of the Board] RELEVANT TO THE 
22 
EMERGENCY INVOLVED, WITHOUT FORMALLY CONVENING A 
23 
MEETING OF THE MONETARY BOARD. 
24 
The Governor shall submit a report to t}:le President and Congress within 
25 
seventy-two (72) hours after the action has been taken. 
26 
At the soonest possible time, the Governor shall call a meeting of the Monetary 
27 
Board to submit his action for ratification." 
28 
SEC. 11. Section 21 of Republic Act No. 7653 is hereby amended to read as follows: 
29 
"SEC. 21. Deputy Governors. -
The Governor of the Bangko Sentral, with 
• 
30 
the approval of the Monetary Board, shall appoint not more than [three (3)J FIVE (5) 
31 
Deputy Governors who 
shall 
perform duties 
AND 
RESPONSIBILITIES 
32 
CONSISTENT WITH THEIR RESPECTIVE SECTORS ASSIGNED TO THEM 
33 
BY THE MONETARY BOARD, TO WIT: [as may be assigned to them by the 
34 
Governor and the Board.] 
35 
(A) DEPUTY GOVERNOR FOR THE MONETARY AND CURRENCY 
36 
MANAGEMENT SECTOR; 
8 




1 
(B) DEPUTY GOVERNOR FOR SUPERVISION AND EXAMINATION 
2 
OF COMMERCIAL AND UNIVERSAL BANKS (INCLUDING THEIR 
3 
SUBSIDIARIES AND AFFILIATES ENGAGED IN FINANCIAL ALLIED 
4 
UNDERTAKINGS) 
AS 
WELL 
AS 
GOVERNMENT-OWNED 
AND 
5 
CONTROLLED BANKS; 
6 
(C) DEPUTY GOVERNOR FOR SUPERVISION AND EXAMINATION 
7 
OF STAND-ALONE RURAL BANKS AND THRIFT BANKS (WHICH ARE 
, 
8 
NOT AFFILIATED TO UNIVERSAL 
OR COMMERCIAL BANKS); 
, 
9 
COOPERATIVE BANKS; AND MICROFINAlNCE BANKS; 
10 
(D) DEPUTY GOVERNOR FOR SUPERVISION AND EXAMINATION 
11 
OF NON-BANK FINANCIAL INTERMEDiARIES WHICH BY. SPECIAL 
12 
LAWS HAVE BEEN PLACED UNDER THE SUPERVISION OF THE 
13 
BANGKO SENTRAL WHICH INCLUDE INYESTMENT HOUSES; SAVINGS 
14 
AND LOAN ASSOCIATIONS; PAWNSHOPS; CREDIT CARD COMPANIES; 
15 
REMITTANCE AGENTS; AND E-MONEY ISSSUERS; 
16 
(E) 
DEPUTY 
GOVERNOR 
FOR 
HUMAN 
RESOURCES 
17 
MANAGEMENT WHO SHALL BE IN CHARGE OF THE ADMINISTRATIVE 
18 
.REQUIREMENTS OF RECRUITMENT, APPOINTMENT, PERFORMANCE 
19 
EVALUATION, AND THE IMPLEMENTATION OF COMPENSATION AND 
• 
20 
BENEFITS, PAYROLL SERVICING, LEAVES AND RETIREMENTS AND 
21 
EMPLOYEE RELATIONS, INCLUDING THE ASSESSMENT OF THE 
22 
TRAINING NEEDS OF ALL PERSONNEL OF THE BANGKO SENTRAL, 
23 
AND THE DESIGN AND ADMINISTRATION OF TRAINING PROGRAMS 
24 
FOR 
THE 
RANK 
AND 
FILE 
EMPLOYEES, 
THE 
EXECUTIVE 
25 
DEVELOPMENT 
AND 
VALUES 
ENHANCEMENT 
COURSES; 
THE 
26 
ADMINISTRATION OF THE MEDICAL AND DENTAL CLINIC, AND WHO 
27 
SHALL SUPERVISE THE CONSTRUCTION, REPAIR AND RENOVATION 
28 
OF ALL BUILDINGS, OFFICES AND F~CILITIES OF THE BANGKO 
29 
SENTRAL, THE GENERAL UP-KEEP AND MAINTENANCE OF THE 
30 
MECHANICAL, 
ELECTRICAL, 
ELECTRONIC 
AND 
31 
AUXILIARY/ACCESSORY EQUIPMENT SYSTEMS OF THE BANGKO 
32 
SENTRAL AND THE PROTECTION AND SAFEGUARDS OF THE MAIN 
33 
OFFICE AND OTHER BRANCHES OF THE BANGKO SENTRAL. 
~ 
34 
THE SCOPE OF THE DUTIES AND 'RESPONSIBILITIES OF EACH 
• 
35 
AND EVERY DEPUTY GOVERNOR AND THE OFFICES UNDER EACH OF 
36 
THEM AND 
THE DELINEATION OF OTHER FUNCTIONS 
AND 
, 
37 
ASSIGNMENTS SHALL BE DEFINED OR REFINED AND PRESCRIBED BY 
38 
THE 
MONETARY 
BOARD 
UPON 
RECOMMENDATION 
OF THE 
39 
GOVERNOR. 
9 
" 
,~. . 
',' 
'I~ 


1 
THE 
MANAGEMENT 
OF 
THE 
PROVIDENT 
FUND, 
THE 
2 
PROCUREMENT SERVICES, INCLUDING 1HE SERVICING OF THE BIDS 
3 
AND AWARDS COMMITTEE AND THE ~ECURITY PLANT COMPLEX 
4 
SHALL BE DEFINED AND PRESCRIBED BY THE MONETARY BOARD. 
s 
THE 
MONITORING, 
REPORTING, 
AND 
THE 
INFORMATION 
6 
TECHNOLOGY APPLICATIONS REQUIRED FOR EACH OF THE OFFICES 
7 
AND SERVICES REFERRED TO IN THIS PARAGRAPH SHALL ALSO BE 
8 
SET FORTH BY THE MONETARY BOARD, UPON RECOMMENDATION 
, 
9 
OF THE GOVERNOR. 
10 
[In the absence of the Governor, a Deputy Governor designated by the 
11 
Governor shall act as chief executive of the Bangko Sentral and shall exercise the 
12 
powers and perform the duties of the Governor. Whenever the Government is unable 
13 
to attend meetings of government boards or councils in which he is an ex officio 
14 
member pursuant to provisions of special laws, a Deputy Governor as may be 
15 
designated by the Governor shall be vested with authority to participate and exercise 
16 
the right to vote in such meetings.]" 
17 
SEC. 12. Section 23 of Republic Act No. 7653 is hereby amended to read as follows: 
18 
"SEC. 23. Authority to Obtain Data and Information. -
The Bangko Sentral 
19· 
shall have the authority to [request] REQUIRE from government offices and 
20 
instrumentalities, or govermuent-owned or controlled corporations, any data which it 
21 
may require for the proper discharge of its functions and responsibilities. The Bangko 
22 
Sentral through the Governor or in his absence;. a [duly authorized representative] 
23 
DEPUTY GOVERNOR DULY AUTHORIZED IN WRITING shall have the 
24 
power to issue a subpoena [for the production of the books and records for the 
25 
aforesaid purpose] SPECIFYING THE DATA REQUIRED AND THE SPECIFIC 
26 
PURPOSE FOR WHICH SUCH DATA SHALL BE ISSUED. Those who refuse 
27 
the subpoena without justifiable cause, or who refuse to supply the [bank] BANGKO 
28 
SENTRAL with data [requested or] required, shall be subj ect to punishment for 
'. 
29 
contempt in accordance with the provisions of the Rules of Court. 
30 
Data on individual firms, other than banks, gathered by the Department of 
31 
Economic Research and other departments or units of the Bangko Sentral shall not be 
32 
made available to any person or entity outside of the Bangko Sentral whether public or 
33 
private except under order of the court or under such conditions as may be prescribed 
34 
by the Monetary Board: Provided, however, That the collective data on firms may be 
35 
released to interested persons or entities: PrOVided, Finally, That in the case of data on 
36 
banks, the provisions of Section 27 of this Act shall apply." 
37 
SEC. 13. Section 24 of Republic Act No. 7653 is hereby amended to read as follows: 
10 
. 
, ','-


1 
"Sec. 24. Training of Technical Personnel. -
The Bangko Sentral shaH promote -and 
2 
sponsor the training of technical personnel in the fields of [money and banking] 
3 
BANKING, QUASI-BANKING, NON-BANK FINANCIAL INTERMEDIARIES, 
4 
MICROFINANCE, DERIVATIVES, ARBITRAGE, FOREIGN EXCHANGE, 
5 
SAVINGS FORMATION, PAYMENT AND 
SETTLEMENT SYSTEMS, 
6 
INFORMATION TECHNOLOGY, MONEY AND CAPITAL MARKETS 
7 
DEVELOPMENT TRENDS, INNOVATIONS AND PRACTICES AND SUCH 
8 
OTHER TRAINING PROGRAMS AS THE MONETARY BOARD SHALL 
9 
APPROVE. Toward this end, the Bangko Sentral is hereby authorized to defray the 
10 
costs of study, at home or abroad, of qualified employees of the Bangko Sentral, of 
11 
promising university graduates or of any other qualified -persons who shall be 
12 
determined by proper competitive examinations. The Monetary Board shall prescribe 
13 
rules and regulations to govern the training progr~ of the Bangko Sentral." 
14 
SEC. 14. Section 25 of Republic Act No. 7653 is hereby amended to read as foHows: 
-
15 
"SEC. 
25. Supervision and Examination. -
SUBJECT TO THE 
16 
PROVISIONS OF SECTION 28 OF THIS ACT, the Bangko Sentral THROUGH 
• 
17 
THE SUPERVISING AND EXAMINING -DEPARTMENT DESIGNATED 
18 
UNDER THIS ACT shaH have supervision over, 'and conduct [periodic] REGULAR 
" 
19 
or special examinations of [banking institutions] BANKS and quasi-banks, including 
20 
their subsidiaries and affiliates engaged in allied activities AND OTHER 
21 
FINANCIAL INSTITUTIONS WHICH UNDER SPECIAL LAWS ARE 
22 
SUBJECT TO BANGKO SENTRAL SUPERVISION. 
23 
THE BANGKO SENTRAL SHALL ALSO HAVE THE POWER TO 
24 
REGULATE AND EXAMINE TRANSACTIONS BETWEEN A SUPERVISED 
25 
INSTITUTION AND ITS PARENT COMPANY. 
26 
For purposes of THE FIRST PARAGRAPH OF this Section, a subsidiary 
27 
means a corporation more than fifty percent (50%) of the voting stock of which is 
28 
owned DIRECTLY OR INIDIRECTL Y by a bank or quasi-bank and an affiliate 
29 
means a corporation the voting stock of which, to. the extent of fifty percent (50%) or 
30 
less, is owned by a bank or quasi-bank or which is related or linked to such institution 
31 
or intermediary through common stockholders, or such other factors as may be 
32 
determined by the Monetary Board. 
33 
IN CONNECTION WITH THE SECOND PARAGRAPH OF THIS 
34 
SECTION, A PARENT COMPANY MEANS A CORPORATION WHICH 
35 
OWNS DIRECTLY OR INDIRECTLY THE VOTING STOCK OF A 
36 
SUPERVISED INSTITUTION OF THE BANGKO SENTRAL SUFFICIENT TO 
• 
37 
CONTROL ITS MANAGEMENT AND OPEIUTIONS. 
11 


1 
AS USED IN THIS SECTION, COj'HROL EXISTS WHEN THE 
2 
PARENT OWNS DIRECTLY OR INDIRECtLY MORE THAN ONE-HALF 
3 
OF THE STOCK OF A SUPERVISED INSTITUTION. CONTROL ALSO 
· 
4 
EXISTS EVEN WHEN THE PARENT OWNS ONE-HALF OR LESS OF THE 
5 
VOTING STOCK OF THE SUPERVISED INSTITUTION WHEN THERE IS 
• 
6 
POWER OVER MORE THAN ONE-HALF OF THE VOTING RIGHTS BY 
7 
PROXY OR BY VIRTUE OF AN AGREEMENT WITH OTHER INVESTORS 
0. 
8 
WHICH THEREBY ENABLES THE PARENT COMPANY TO CAST THE 
9 
MAJORITY OF VOTES AT MEETINGS OF THE STOCKHOLDERS OF THE 
10 
SUPERVISED INSTITUTION, OR TO ELECT THE MAJORITY OF 
11 
MEMBERS OF THE BOARD OF DIRECTORS OF THE SUPERVISED 
12 
INSTITUTION ,OR TO APPOINT KEY EXECUTIVE OFFICERS WHO 
13 
SHALL DIRECTLY OR INDIRECTLY CONTROL THE MANAGEMENT 
14 
AND OPERATIONS OF THE SUPERVISED INSTITUTION. 
15 
The department heads and the examiners of the supervising and/or examining 
16 
departments are hereby authorized to administer oaths to any director, officer', or 
17 
employee of any institution under their respective supervision or subject to their 
18 
examination and to compel the presentation of all books, documents, papers or records 
19 
necessary in their judgment to ascertain the facts relative to the true condition of any 
20 
institution as well as the books and records of ~ersons and entities relative to or in 
21 
counection with the operations, activities or transactions of the institution under 
22 
examination, subject to the provision of existing laws protecting or safeguarding the 
23, 
secrecy or confidentiality of bank deposits as well as investments of private persons, 
,24 
natural or juridical, in debt instruments issued by the Government. 
25 
[No restraining order or injunction shall be issued by the court enjoining the Bangko 
26 
Sentral from examining any institution subject td. supervision or examination by the 
27 
Bangko Sentral, unless there is convincing proof that the action of the Bangko Sentral 
• 
28 
is plainly arbitrary and made in bad faith and the petitioner or plaintiff files with the 
29 
clerk or judge of the court in which the action is pending a bond executed in favor of 
30 
the Bangko Sentral, in an amount to be fixed by the court. The provisions of Rule 58 
31 
of the New Rules of Court insofar as they are applicable and not inconsistent with the 
32 
provisions of this Section shall govern the issuance and dissolution of the restraining 
• 
33 
order or injunction contemplated in this Section.]''.. 
34 
SEC. 15. Section 26 of Republic Act No. 7653 is hereby amended to read as follows: 
35 
"SEC. 26. 
Bank Deposits [and InvestmrntsJ. -
Any director, officer or 
36 
stockholder who, together with his related interest, contracts a loan or any form of 
37 
financial accommodation from: (1) his bank; or (2) from a bank (a) which is a 
, 
38 
subsidiary of a bank holding company of which both his bank and the lending bank are 
12 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
subsidiaries or (b) in which a controlling proportion of the shares is owned by the same 
interest that owns a controlling proportion of the shares of his bank, in excess of five 
percent (5%) of the capital and surplus of the bank, or in the maximum amount 
permitted by law, whichever is lower, shall be required by the lending bank to waive 
the secrecy of his 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 by the examiners only in connection with their 
supervisory and examination responsibility or by the Bangko Sentral in an appropriate 
legal action it has initiated involving the deposit a~count. 
RELATED INTEREST, AS USED IN THIS SECTION, SHALL REFER 
TO 
STOCKHOLDINGS 
OF 
FAMILY 
GROUPS 
OR 
CORPORATE 
HOLDINGS OF THE SAME FAMILY GROUPS OR SAME GROUPS OF 
PERSONS AS DEFINED IN SECTION 12 AND SECTION 13 OF REPUBLIC 
ACT NO. 8791 OTHERWISE KNOWN AS THE GENERAL BANKING LAW 
OF 2000 WHO CONTROL OR OWN AT LE~ST FORTY PERCENT (40%) OF 
THE VOTING STOCK OF A BANK, QUASI BANK, AND OTHER 
• 
FINANCIAL INSTITUTION WHICH IS SUBJECT TO SUPERVISION BY 
THE BANGKO SENTRAL; RELATED INTEREST MAY ALSO REFER TO A 
HOLDING COMPANY THAT CONTROLS OR OWNS AT LEAST FORTY 
PERCENT (40%) OF THE VOTING STOCK AS A GROUP, OF BANKS, 
QUASI BANKS AND OTHER FINANCIAL INSTITUTIONS WHICH ARE 
SUBJECT TO SUPERVISION BY THE BANGKO SENTRAL." 
'. 
SEC. 16. Section 27 of Republic Act No. 7653 is hereby amended to read as follows: 
"SEC. 27. Prohibitions. -
In addition to the prohibitions found in Republic 
Act Nos. 3019 and 6713, personnel of the Bangko Sentral are hereby prohibited from: 
(a) being an officer, director, lawyer or agent, employee, consultant or 
stockholder, directly or indirectly, of any in§titution subject to supervision or 
examination by the Bangko Sentral, except non-stock savings and loan associations 
and provident funds organized exclusively for employees of the Bangko Sentral, and 
30 
except as otherwise provided in this Act; 
31 
(b) directly or indirectly requesting or receiving any VALUABLE 
gift, 
32 
[present] IN KIND 
or pecuniary or material benefit for himself/HERSELF or 
33 
[another] 
FOR A 
RELATIVE WITHIN, THE FIRST DEGREE OF 
34 
CONSANGUINITY OR AFFINITY from any institution subject to supervision or 
35 
examination by the Bangko Sentral; 
36 
(c) revealing in any manner, except under orders of the court, the [Congress] 
37 
HOUSE OF REPRESENTATIVES OR THE SENATE OR ANY OF THE 
38 
APPROPRIATE COMMITTEES THEREIN or any government office or agency 
13 


1 . 
authorized by law, or under such conditions as may be prescribed by the Monetary 
2 
Board, information relating to the condition or business of any institution UNDER 
3 
ITS SUPERVISION. This prohibition shall not be held to apply to the giving of 
4 
information to the Monetary Board or the Goverrf.or of the Bangko Sentral, or to any 
5 
person authorized by either of them, in writing, to receive such inforInation; and 
, 
6 
(d) borrowing from any institution subject to supervision or examination by the 
7 
Bangko Sentral shall be prohibited unless said borrowings are adequately secured, 
8 
fully disclosed to the Monetary Board, and shall be subject to such further rules and 
9 
regulations as the Monetary Board may prescribe: .Provided, however, That personnel 
10 
of the supervising and examining departments are prohibited from borrowing from a 
11 
bank under their supervision or examination." 
'. 
12 
SEC. 17. Section 28 of Republic Act No. 7653 is hereby amended to read as follows: 
13 
"SEC. 28. Examination and Fees. -
The supervising and examining 
14 
department head, personally or by deputy, shall examine the books AND RECORDS 
15 
of every banking, OR QUASI-BANKING OR NON-BANK FINANCIAL 
16 
institution once in every twelve (12) months, and at such other times as the Monetary 
17 
Board by an affirmative vote of five (5) members, may deem expedient and to [make a 
18 
report on the same] SUBMIT AN EXECUTIVE SUMMARY OF THE FINDINGS 
19 
OF EXAMINATION WITH THE REPORT OF EXAMINATION ATTACHED 
20 
THERETO FOR READY REFERENCE to the Monetary Board: Provided, That 
21 
there shall be an interval of at least twelve (12) months between annual examinations. 
22 
THE SUPERVISED INSTITUTIONS D.NDER THIS SECTION SHALL 
23 
BE GIVEN THE OPPORTUNITY TO CONTEST IN WRITING ANY OR ALL 
24 
OF THE FINDINGS OF THE EXAMINERS OF THE SUPERVSING AND 
25 
EXAMINATION DEPARTMENT OF THE BANGKO SENTRAL IN AN EXIT 
26 
CONFERENCE BEFORE THE REPORT OF EXAMINATION IS FINALIZED. 
27 
THE WRITTEN EXPLANATIONS, IF ANY, OF THE SUPERVISED 
28 
INSTITUTION UNDER EXAMINATION SHALL BE PART OF THE REPORT 
29 
OF EXAMINATION WITH COMMENTS IF DEEMED WARRANTED BY 
~ 
30 
THE EXAMINERS INVOLVED. 
31 
The 
bank, 
OR 
QUASI-BANK 
OR 
NON-BANK 
FINANCIAL 
32 
INSTITUTION concerned shall afford to the head of the appropriate supervising and 
33 
examining departments and to his authorized dep~ties full opportunity to examine its 
34 
books, cash and available assets and general condition at any time during banking 
35 
hours when requested to do so by the Bangko Se~tral: Provided, however, That none 
36 
of the reports and other papers relative to such examinations shall be open to 
37 
inspection by the public except insofar as s~ch publicity is incidental to the 
14 


" 
1 
proceedings hereinafter authorized or is necessary for the prosecution of violations in 
2 
connection with the business of such institutions, 
3 
Banking, [and] quasi-banking, AND NON-BANK FINANCIAL institutions which 
4 
are subject to examination by the Bangko Sentral shall pay to the Bangko Sentral, 
• 
5 
within the first thirty (30) days of each year, an annual fee in an amonnt equal to a 
6 
percentage as may be prescribed by the Monetary Board of its average total assets 
7 
during the preceding year as shown on its end-of-QUARTER [month balance sheets] 
8 
STATEMENT OF CONDITION, after deducting cash on hand and amounts ,due 
9 
from banks, QUASI-BANKS, AND OTHER FINANCIAL INSUTUTIONS, 
10 
including the Bangko Sentral and banks abroad," 
11 
SEC. 18. Section 29 of Republic Act No. 7653 is hereby a,mended to read as follows: 
12 
"SEC. 29. Appointment of Conservator. -
Whenever, on the basis of a report 
13 
OF EXAMINATION submitted by the 
app~opriate supervising or examining 
14 
department 
OF 
THE 
BANGKO 
SENTRAL, 
the 
Monetary 
Board, 
IN 
15 
CONSULTATION 
WITH 
THE 
PHILIPPINE 
DEPOSIT 
INSURANCE 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
CORPORATION (PDIC), CONFIRMS [finds] that a bank or a quasi-bank is in a 
state of continuing inability or unwillingness to maintain a, condition of liquidity 
deemed adequate to protect the interest of deposit'lrs and creditors, OR CONTINUES 
TO SUFFER CHRONIC RESERVE OR CAPITAL DEFICIENCIES WHICH, 
, 
IF NOT CORRECTED, WILL EVENTUALLY RESULT IN INSOLVENCY, the 
Monetary Board, IN ORDER TO AVERT THE THREATENED INSOLVENCY 
OF THE BANK, [may] 
SHALL appoint a conservator WHO SHALL 
, 
, 
INTRODUCE AND ADOPT MANAGEMENT REFORMS AND CORRECTIVE 
• 
MEASURES THAT WILL ENABLE THE BANK TO RESTORE AND 
MAINTAIN ITS VIABILITY. THE CONSERVATOR [with] SHALL HAVE 
" 
such powers as the Monetary Board shall deem necessary to ENABLE HIM TO take 
charge of the assets, liabilities, and the management thereof, reorganize the 
management, collect all monies and debts due said institution, PLACE OR INVEST 
29 
ITS 
FUNDS 
IN 
READILY 
MARKETABLE 
SECURITIES 
AND 
30 
INVESTMENTS, SELL, IF NECESSARY, REAL PROPERTIES AND OTHER 
31 
FIXED ASSETS TO MEET ITS OBLIGATIONS, and exercise all powers 
32 
[necessary] to restore AND MAINTAIN its viability. The conservator shall report and 
33 
be responsible to the Monetary Board, WITH. A COPY OF SUCH REPORT 
34 
FURNISHED THE PDIC, and shall have the power to overrule or revoke the actions 
35 
of the previous management and board of directors of the bank or quasi-bank, 
36 
EXCEPT THAT SUCH POWER CANNOT E{{TEND TO THE POST FACTO 
37 
REPUDIATION OF PERFECTED CONTRACTS THAT INFRINGE AGAINST 
38 
THE NON-IMPAIRMENT CLAUSE OF THE CONSTITUTION. 
15 


1 
The conservator should be competent and knowledgeable in bank operations 
2 
and management. The conservatorship shaH not exceed one (I) year, WHICH MAY 
3 
BE EXTENDED FOR A PERIOD OF NOT MORE THAN SIX (6) MONTHS, 
4 
AS MAY BE APPROVED BY THE MONETARY BOARD. The conservator shall 
5 
receive remuneration to be fixed by the Monetary Board, PAYABLE IN MONTHLY 
6 
PAYMENTS: [in an amount not to exceed two-thirds (2/3) of the salary of the 
7 
president of the institution in one (1) year, payable in twelve (12) equal monthly 
~ 
8 
payments:] Provided, That, if at any time 'within the one7year period, the 
° 
9 
conservatorship is terminated on the ground that tlte institution can operate on its own, 
10 
the conservator shaH receive the balance of the remuneration which he would have 
. 
11 
received up to the end of the year; but if the conservatorship is terminated on other 
12 
grounds, the conservator shaH not be entitled to such remaining balance. The Monetary 
• 
13 
Board [may appoint a conservator connected with the Bangko Sentral,] SHALL 
14 
AUTHORIZE THE CONSERVATOR TO APPOINT A CORE GROUP OF 
o. 
15 
PROFESSIONALS TO ASSIST HIM IN THE PERFORMANCE OF HIS 
16 
POWERS AND DUTIES AS CONSERVATOR, in which case, [he] THEY shaH 
17 
[not] be entitled to receive [any] remuneration or emoluments THAT THE 
18 
MONETARY BOARD SHALL DETERMINE [from the Bangko Sentral] during 
, 
19 
the PERIOD OF conservatorship. The expenses attendant to the conservatorship shall 
20 
be borne by the bank or quasi-bank concerned. 
21 
UPON THE REQUEST OF THE CONSERVATOR, THE MONETARY 
22 
BOARD MAY AUTHORIZE THE GRANT .oF EMERGENCY LOANS .OR 
23 
ADVANCES TO THE INSTITUTION TO MEET IN A TIMELY MANNER ITS 
24 
MATURING OBLIGATIONS OR UNUSUAL DEPOSIT WITHDRAWALS 
25 
WHILE THE CONSERVATOR IS IN THE, PROCESS OF COLLECTING 
26 
MONIES 
AND 
DEBTS 
DUE 
THE 
INSTITUTION 
UNDER 
27 
CONSERVATORSHIP, OR LIQUEFYING ITS ASSETS TO RECOVER FROM 
28 
ITS ILLIQUID CONDITION AND THEREBY RESTORE THE BANK TO 
29 
NORMALCY. THE BANGKO SENTRAL SHALL REQUIRE COLLATERALS 
30 
FOR SUCH EMERGENCY LOANS OR ADVANCES, PROVIDED, THAT, IF 
31 
THE COLLATERALS ARE AUTHORIZED TO BE SOLD OR DISPOSED OF, 
32 
THE PROCEEDS SHALL BE APPLIED TO PAY OR PREPAY THE LOANS 
~ 
33 
OR ADVANCES, OR PORTIONS THEREOF, AS THE BANGKO SENTRAL 
34 
MAY STIPULATE. 
35 
DURING THE PERIOD OF CONSERVATORSHIP, THE PDIC SHALL 
36 
HAVE 
THE 
AUTHORITY 
TO 
EXAMINE 
THE 
BANK 
UNDER 
37 
CONSERVATORSHIP, INQUIRE INTO OR EXAMINE THE DEPOSIT 
38 
ACCOUNTS THEREIN, AND/OR CONDUCT' A DUE DILIGENCE AUDIT OF 
16 
'. 


1 
THE BANK IN PREPARATION FOR THE POSSIBLE ESTABLISHMENT, 
2 
ORGANIZATION AND OPERATION OF A BRIDGE BANK. 
3 
The Monetary Board shall terminate the conservatorship when it is satisfied 
• 
4 
that the institution can continue to operate on its" own and the conservatorship is no 
5 
longer necessary. The conservatorship shall likewise be terminated should the 
6 
Monetary Board, on the basis of the report of the, conservator or of its own findings, 
7 
determine that the continuance in business of the institution, DESPITE THE 
8 
REMEDIAL MEASURES THAT HAVE BEEN ADOPTED, CONTINUE TO 
• 
9 
EXPERIENCE 
ILLIQUIDITY 
AND 
OTHER RELATED 
FINANCIAL 
10 
STRESSES, 
SUCH 
THAT 
THERE 
EXIST 
GROUNDS 
FOR 
THE 
11 
INSTITUTION TO ENTER RECEIVERSHIP AND LIQUIDATION, [would 
12 
involve probable loss to its depositors or creditors,] in which case the provisions of 
13 
Section 30 shall apply." 
14 
SEC. 19. Section 30 of Republic Act No. 7653 is hereby amended to read as follows: 
15 
"SEC. 30. Proceedings in Receiversh'ip alid Liquidation. - Whenever, [upon] 
16 
ON THE BASIS OF A report of [the head, of the supervising or examining 
17 
department] EXAMINATION, the Monetary B~ard finds OR CONFIRMS that a 
18 
bank or quasi-bank: 
19 
(a) HAS NOTIFIED THE BANGKO SENTRAL OR PUBLICLY 
20 
ANNOUNCED A UNILATERAL CLOSURE, OR HAS BEEN DORMANT FOR 
21 
AT LEAST SIXTY (60) DAYS OR IN ANY MANNER HAS SUSPENDED THE 
• 
22 
PAYMENT OF ITS DEPOSITIDEPOSIT LIABILITIES, OR is unable to pay its 
23 
liabilities as they become due in the ordinary co~se of business: Provided, That this 
24 
shall not include inability to pay caused by extraordinary demands induced by 
25 
financial panic in the banking OR FINANCIAL community; OR 
26 
(b) has insufficient realizable assets TO MEET ITS LIABILITIES, as 
27 
determined by the Bangko Sentral[, to meet i~s liabilities] IN ACCORDANCE 
28 
WITH BANKING REGULATIONS; or 
29 
(c) cannot continue in business without irivolving SUBSTANTIAL probable 
30 
losses to its depositors or creditors RELATIVE TO THE SIZE OF THE 
31 
INSTITUTION CONCERNED; or 
32 
(d) has willfully violated a cease and desist order under Section 37 that has 
33 
become final, involving acts or transactions which amount to fraud or a dissipation of 
. 
, 
34 
the assets of the institution; in which cases, the Monetary Board may summarily and 
35 
without need for prior hearing forbid the institution from doing business in the 
36 
Philippines, and IN CASE IT IS A BANK designate the Philippine Deposit Insurance 
37 
Corporation as receiver of the banking institution. THE MONETARY BOARD 
38 
SHALL NOTIFY IN WRITING THE BOARD OF DIRECTORS OF ITS 
17 


1 
FINDINGS AND 
DIRECT THE PDIC 'TO PROCEED WITH THE 
2 
LIQUIDATION OF THE CLOSED BANKING INSTITUTION PURSUANT TO 
3 
PARAGRAPH 6 OF THIS SECTION. 
4 
For a quasi-bank, any person of recognizeq competence in banking or finance 
5 
SHALL [may] be designated as receiver. 
6 
THE AUTHORITY OF THE MONETARY BOARD TO PLACE A 
7 
BANK OR QUASI-BANK UNDER RECEIVERSHIP AS PROVIDED ABOVE 
8. . 
SHALL ALSO BE EXERCISED OVER OTHER NON-BANK FINANCIAL 
9 
INSTITUTIONS WHICH UNDER THIS ACT OR SPECIAL LAWS ARE 
10 
SUBJECT TO BANGKO SENTRAL SUPERVISION, BASED ON THE SAME 
11 
APPLICABLE GROUNDS. FOR THIS 
~URPOSE,. ANY PERSON OF 
12 
RECOGNIZED COMPETENCE IN BANKING" CREDIT AND FINANCE MAY 
13 
BE DESIGNATED AS A RECEIVER. 
14 
The receiver shall immediately gather, take charge of, MANAGE AND 
15 
CONTROL all the assets, WHICH, IN CASE OF A BANK, SHALL INCLUDE 
16 
ITS LICENSE, and liabilities of the institution, administer the same for the benefit of 
• 
17 
its creditors, and, exercise the general powers of a receiver under EXISTING LAWS 
18 
AND the Revised Rules of Court. HOWEVER', THE DISPOSITION OF THE 
'. 
19 
LICENSE BY THE RECEIVER SHALL BE SUBJECT TO THE APPROVAL 
20 
OF THE MONETARY BOARD. THE RECEIVER SHALL ADDITIONALLY 
21 
HAVE THE AUTHORITY TO: (1) [but shall not, with the exception of] PAY 
22 
administrative expenditures, [payor commit any act that will involve the transfer or 
23 
disposition of any asset of the institution: Pr~vided, That the receiver may] (2) 
24 
deposit or place the funds of the institution in non-speculative investments, OR (3) 
25 
ADOPT, IF DEEMED APPROPRIATE BY THE RECEIVER, BRIDGE 
26 
BANKING AS A RESOLUTION METHOD, AS GOVERNED BY SECTION.30-
27 
B OF THIS ACT. The receiver OF QUASI-BANKS AND NON-BANK 
28 
FINANCIAL INSTITUTIONS shall determine as soon as possible, but not later 
29 
than ninety (90) days from take-over, wheth.,r [the] SUCH institution may be 
30 
rehabilitated or otherwise placed in such a condition so that it may be permitted to 
31 
resume business with safety to its [depositors an~] creditors and the general public: 
32 
Provided, That any determination for the resumption of business of the institution 
33 
shall be subject to prior approval of the Monetary Board. 
34 
IN ORDER TO REHABILITATE THE CLOSED INSTITUTION OR TO 
35 
RESTORE ITS OPERATIONS WITH SAFETY TO ITS CREDITORS AND 
36 
THE GENERAL PUBLIC OR TO MERGE O~ CONSOLIDATE THE CLOSED 
37 
INSTITUTION 
WITH 
ANOTHER 
QUAIcIFIED 
INSTITUTION, 
THE 
38 
RECEIVER OF QUASI-BANKS AND OTHER NON-BANK FINANCIAL 
18 


1 
INSTITUTIONS MAY IMMEDIATELY TRANSFER OR DISPOSE OF ANY 
, 
2 
OR ALL OF THE ASSETS OF THE CLOSED INSTITUTION AND PERFORM 
3 
SUCH OTHER ACTS AS MAY BE AUTHORIZED BY LAW. 
4 
If the receiver OF QUASI-BANK AND OTHER NON-BANK FINANCIAL 
5 
INSTITUTIONS determines that the institution cannot be rehabilitated or permitted to 
• 
6 
resume business in accordance with the next. preceding paragraph OF THIS 
7 
SECTION, the Monetary Board shall notify in writing the board of directors of its 
, 
8 
findings and direct the receiver to proceed with the liquidation of the institutions. The 
9 
receiver shall: 
10 
1. file ex parte with the proper regional trial court, and without requirement of 
11 
prior notice or any other action, a petition for assistance in the liquidation of the 
12 
institution pursuant to a liquidation plan adopted I>Y the Philippine Deposit Insurance 
13 
Corporation for general application to all closed banks. In case of quasi-banks, the 
14 
liquidation plan shall be adopted by the Monetary Board. Upon acquiring jurisdiction, 
15 
the court shall, upon motion by the receiver after due notice, adjudicate disputed 
16 
claims against the institution, assist the enforcement of individual liabilities of the 
17 
stockholders, directors and officers, and decide on other issues as may be material to 
18 
implement the liquidation plan adopted. The recelVer shall pay the cost of the 
19 
proceedings from the assets of the institution .. 
20 
2. convert the assets of the institution to money, dispose of the same to 
21 
creditors and other parties, for the purpose of paying the debts of such institution in 
22 
accordance with the rules on concurrence and preference of credit under the Civil 
23 
Code of the Philippines and he may, in the name of the institution, and with the 
24 
assistance of counsel as he may retain, institute such actions as may be necessary to 
25 
collect and recover accounts and assets of, or defend any action against, the institution. 
26 
The assets of an institution under receivership ~ or liquidation shall be deemed in 
27 
custodia legis in the hands of the receiver and sh\lll, from the moment the institution 
28 
was placed under such receivership or liquidation, be exempt from any order of 
29 
garnishment, levy, attachment, or execution. 
30 
The actions of the Monetary Board taken under this section or under Section 29 
31 
of this Act shall be final and executory, and may not be restrained or set aside by the 
• 
32 
court except on petition for certiorari on the ground that the action taken was in excess 
33 
of jurisdiction or with such grave abuse of discretion as to amount to lack or excess of 
'. 
34 
jurisdiction. The petition for certiorari may only be filed by the stockholders of record 
35 
representing the majority of the capital stock within ten (10) days from receipt by the 
36 
board of directors of the institution of the order directing receivership, liquidation or 
37 
conservatorship. 
38 
The designation of a conservator undl:r Section 29 of this Act or the 
39 
appointment of a receiver under this section shall be vested exclusively with the 
19 


1 
Monetary Board. [Furthermore, the designation of.a conservator is not a precondition 
2 
to the designation of a receiver.]" 
3 
SEC. 20. A new section entitled section 30-A of the same Act shall be inserted between Section 30 
4 
and Section 30-B which shall read as follows: 
5 
"SEC. 30-A. PROMPT CORRECTIVE ACTION (PCA). - WHENEVER 
6 
ON THE BASIS OF THE REPORT OF EXAMINATION (ROE), THE 
7 
MONETARY BOARD FINDS THAT A BANK OR NON-BANK FINANCIAL 
• 
8 
INSTITUTION PERFORMING QUASI-BANK FUNCTIONS IS CAPITAL 
9 
DEFICIENT AND FAILS TO COMPLY. WITH MINIMUM CAPITAL 
10 
REQUIREMENTS 
PRESCRIBED 
UNDER 
EXISTING 
LAWS 
AND 
11 
IMPLEMENTING REGULATIONS, THE MONETARY BOARD SHALL 
12 
TAKE PROMPT CORRECTIVE ACTION' DIRECTING THE ENTITIES 
13 
AFOREMENTIONED TO INFUSE ADDITIONAL CAPITAL UP TO AN 
14 
AMOUNT NECESSARY TO RESTORE THEIR CAPITAL TO THE 
15 
MINIMUM REQUIRED AMOUNT. THE AF1<'ECTED ENTITIES SHALL BE 
16 
GIVEN A PERIOD OF NOT LESS THAN (10) MONTHS FROM THE DATE 
• 
17 
OF RECEIPT OF THE DIRECTIVE OF THE MONETARY BOARD TO 
18 
COMPLY WITH THE CAPITAL RESTORATION PROGRAM. IF IT IS 
19 
SHOWN THAT THE AFFECTED ENTITY HAS TAKEN EARNEST 
20 
EFFORTS TO COMPLY WITH THE MANDATE OF THE MONETARY 
21 
BOARD, THE AFFECTED ENTITY SHALL BE GIVEN BY THE MONETARY 
, 
22 
BOARD AN EXTENSION OF ANOTHER FOUR (4) MONTHS TO COMPLY 
23 
WITH THE MONETARY BOARD DIRECTIVE. 
24 
IN CASE THE REPORT OF EXAMINATION (ROE) OF THE 
25 
AFFECTED ENTITY ALSO SHOWS THAT IT ALSO FAILED TO ADDRESS 
26 
CORPORATE MANAGEMENT INADEQUACIES AND/OR NEEDS TO 
27 
INSTITUTE ADMINISTRATIVE REFORMS THAT ARE AUTHORIZED 
28 
UNDER THIS ACT OR SPECIAL LAWS, THE MONETARY BOARD, IN 
29 
ADDITION TO INSTITUTING PROMPT CORRECTIVE ACTION THAT 
30 
DEALS SPECIFICALLY WITH THE CAPITAL DEFICIENCY PROBLEM, 
31 
MAY IMPOSE OTHER SUPERVISORY INTERVENTIONS THAT ARE 
32 
AUTHROIZED UNDER THIS ACT OR SPECIAL LAWS. 
33 
IN THE EVENT THAT THE AFFECTED BANK IS A RURAL BANK 
, 
34 
WHICH IS UNABLE TO COMPLY WITH THE CAPITAL RESTORATION 
35 
PROGRAM INSTITUTED BY THE MONETARY BOARD WITHIN THE 
36 
PRESCRIBED PERIOD AND IN ORDER TO PREVENT THE RURAL BANK 
37 
AFFECTED FROM BEING CLOSED, ANOTHER RURAL BANK SHALL BE 
38 
GIVEN THE RIGHT OF FIRST REFUSAL TO INVEST, CONSOLIDATE OR 
20 


1 . 
MERGE WITH THE SAID BANK OR TO ACQUIRE THE' ASSETS AND 
2 
ASSUME THE LIABILITIES OF SAID RURAL BANK IN ORDER TO 
3 
RESTORE THE NORMAL OPERATIONS OF SAID RURAL BANK, ToO THE 
4 
EXCLUSION OF OTHER CATEGORIES 011 BANKS UNLESS NO OTHER 
5 
RURAL BANK OF GOOD STANDING EXP,RESSES TO EXERCISE THE 
6 
RIGHT OF FIRST REFUSAL PROVIDED UNDER THIS SECTION. THE 
7 
RURAL BANKERS ASSOCIATION OF THE PHILIPPINES SHALL BE 
, 
8 
OFFICIALLY NOTIFIED BY THE MONETARY BOARD IN WRITING OF 
9 
THE RIGHT OF FIRST REFUSAL MADE AVAILABLE UNDER THIS 
• 
10 
SECTION IN ORDER THAT ALL RURAL BANKS OF GOOD STANDING 
11 
SHALL BE NOTIFIED ACCORDINGLY. 
'. 
12 
IN CASE THE AFFECTED BANK IS A GOVERNMENT BANK OR A 
13 
GOVERNMENT 
QUASI-BANK 
WITH 
ORIGINAL 
STATUTORY 
14 
CHARTERS, INFUSION OF ADDITIONAL CAPITAL BEYOND WHAT IS 
15 
PRESCRIBED 
IN 
THEIR 
CHARTERS 
SHALL 
BE 
UNDERTAKEN 
16 
THROUGH AMENDATORY LEGISLATI@N. HOWEVER, ISSUES OF 
17 
CAPITAL NOTES SUBORDINATED TO OTHER CREDITS BUT SUPERIOR 
18 
TO THE EQUITY OF STOCKHOLDERS IN THE ORDER Ol" PREFERENCE 
19 
OF CLAIMS AGAINST THE AFFECTED GOVERNMENT FINANCIAL 
20 
INSTITUTION IS HEREBY AUTHORIZED TO BE ISSUED, WITH 
21 
NATIONAL GOVERNMENT GUARANTEE AND SHALL BE QUALIFIED AS 
22 
EQUIVALENT TO THE REQUIRED CAPITAL INFUSION." 
23 
SEC. 21. A ,new section entitled section 30-B of the saDie Act shall be inserted between Sections 
24 
30-A and 31 which shall read as follows: 
25 
"SEC. 30-B. BRIDGE BANKING. - (A) THE PHILIPPINE DEPOSIT 
26 
INSURANCE 
CORPORATION 
(PDlC) 
MAY 
FORM, 
ESTABLISH, 
27 
ORGANIZE, AND 
OPERATE AND/OR, CONTRACT TO 
OPERATE 
28 
SUBSIDIARIES OR CORPORATIONS WHOSE PRIMARY PURPOSE IS TO 
29 
OPERATE AS A BRIDGE BANK AND/OR MANAGE ACQUIRED ASSETS 
30 
OF THE PDlC. 
31 
(B) A BRIDGE BANK REFERS TO A TEMPORARY BANK LICENSED 
, 
32 
BY THE BANGKO SENTRAL, ESTABLISHED AND OPERATED TO 
33 
ACQUIRE ASSETS AND ASSUME LIABILITIES OF A FAILED BANK. THE 
34 
BRIDGE BANK SHALL HAVE AUTHORITY TO PURCHASE ASSETS, 
35 
ASSUME DEPOSITS AND OTHER LIABILITIES WHICH THE PDlC MAY 
36 
DETERMINE TO BE APPROPRIATE; AND PERFORM SUCH OTHER 
37 
BANKING FUNCTIONS AS THE MONETARY BOARD MAY AUTHORIZE, 
38 
CONSISTENT WITH THE OBJECTIVES OF THIS SECTION. 
21 


0. 
1 
(C) A BRIDGE BANK RESOLUTION MEASURE MAY BE ADOPTED 
2 
ONLY IF THE BOARD OF DIRECTORS DETERMINES THAT IT IS A 
3 
COST-EFFECTIVE AND VIABLE RESOLUTION MEASURE AND THE 
4 
AMOUNT NECESSARY TO IMPLEMENT SUCH MEASURE IS LESS THAN 
5 
THE ESTIMATED INSURED DEPOSITS OF THE FAILED BANK; AND THE 
6 
PRESERVATION OF CRITICAL BANKING FUNCTIONS IS IN THE BEST 
7 
INTEREST OF THE DEPOSITORS AND THE PUBLIC. 
8 
(D) FOR THE EFFECTIVE IMPLEME~TATION OF A BRIDGE BANK 
9 
RESOLUTION MEASURE, THE PDlC MAY: 
10 
1. 
SELL, 
ASSIGN, 
TRANSFER, 
OR 
CONVEY 
ITS 
11 
SHAREHOLDINGS IN ITS SUBSIDIARY TO THE FAILED BANK; 
, 
12 
2. TRANSFER SUCH ASSETS AND DEPOSIT LIABILITIES OF 
13 
A FAILED BANK TO THE BRIDGE BANK, AS THE PDIC MAY 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
35 
36 
37 
38 
39 
DEEM 
APPROPRIATE. 
ALL 
tRANSFERS 
UNDER 
THIS 
SUBSECTION SHALL: 
I. 
NOT BE SUBJECT TO ANY TAXES, SUCH AS 
CAPITAL GAINS TAX, AS WELL AS INCOME TAX, 
VALUE ADDED TAX AND DOCUMENTARY STAMP 
'TAX, AND OTHER TAXES, AS MAY BE APPLICABLE; 
II. BE CONSIDERED IN CUSTODIA LEGIS IN THE 
• 
HANDS OF THE BRIDGE BANK FROM THE TIME 
THE ASSETS ARE TRANSFERRED TO A BRIDGE 
BANK, ITS ASSETS SHALL NOT BE SUBJECT TO 
ATTACHMENT, EXECUTION, 'GARNISHMENT, LEVY, 
FORECLOSURE OR ANY OTHER COURT PROCESSES. 
, 
THEREFORE, A JUDGE, OFFICER OF THE COURT OR 
ANY PERSON WHO SHALL ISSUE, ORDER, PROCESS 
OR CAUSE THE ISSUANCE OR IMPLEMENTATION 
OF 
THE 
WRIT 
OF 
GARNISHMENT, 
LEVY, 
ATTACHMENT OR EXECUTION SHALL BE LIABLE 
UNDER SECTION 22 HEREOF. 
, 
III. BE EFFECTIVE WITHOUT ANY CONSENT FROM 
THE 
STOCKHOLDERS, 
CREDITORS, 
STAKEHOLDERS 
OF 
THE 
FAILED 
BANK, 
NOTWITHSTANDING ANY PROVISION OF LAW TO 
THE CONTRARY. 
3. 
MAKE ADVANCES TO TH,E BRIDGE BANK OR CLOSED 
BANK, UPON SUCH TERMS AND CONDITIONS AND IN SUCH 
FORM AND 
AMOUNTS AS 
THE PDlC 
MAY 
PRESCRIBE, 
22 


1 
SUFFICIENT FUNDS FOR THE BRIDGE BANK TO OPERATE. 
2 
THESE ADVANCES SHALL PARTAKE OF THE NATURE OF 
3 
PUBLIC FUNDS, AND AS SUCH,' MUST BE CONSIDERED A 
4 
PREFERRED CREDIT SIMILAR TO TAXES DUE TO THE 
5 
NATIONAL GOVERNMENT IN THE ORDER OF PREFERENCE 
6 
UNDER ARTICLE 2224 OF THE NEW CIVIL CODE; 
7 
4. CONDUCT DUE DILIGENCE ON AN INSURED BANK, AND 
8 
EXAMINE AND AUDIT THE DEPOSIT ACCOUNTS AND/OR 
9 
RECORDS, OF AN INSURED BAN!}, SO AS TO ESTABLISH A 
10 
DEPOSIT PROFILE OF THE BANK AS TO THE NUl\1BER OF 
11 
DEPOSIT 
ACCOUNTS 
AND 
TOTAL 
INSURED 
DEPOSITS: 
12 
PROVIDED, 
THAT 
THE 
INFORMATION 
ON 
INDIVIDUAL 
13 
ACCOUNTS OBTAINED THROUGH SUCH EXAMINATION OR 
14 
AUDIT SHALL NOT BE DISCLOSED OR RELEASED TO ANY 
o 
15 
OTHER PARTY EXCEPT TO THE BOARD OF DIRECTORS OF THE 
16 
PDlC OR UPON ORDER OF THE COURT; AND 
17 
5. APPOINT, INSTALL, DESIGNATE, AND/OR REMOVE THE 
18 
DIRECTORS AND OFFICERS OF A BRIDGE BANK AND FIX THEIR 
19 
COMPENSATION. 
• 
, 20 
(E) THE 90-DAY PERIOD PROVIDED UNDER SECTION 30 OF 
21 
REPUBLIC ACT 7653, AS AMENDED, WITHIN WHICH THE RECEIVER 
22 
SHALL 
DETERMINE 
WHETHER 
THE 
INSTITUTION 
MAY 
BE 
23 
REHABILITATED SHALL NOT BE APPLICABLE. 
24 
(F) THE BRIDGE BANK SHALL TERMINATE AT THE END OF TWO 
25 
(2) YEARS FOLLOWING THE DATE IT WAS GRANTED A BANKING 
26 
LICENSE, SUBJECT TO THE PROVISION~ IN THE PARAGRAPHS (G) 
27 
AND (H); PROVIDED, FURTHER, THAT THE PDIC MAY EXTEND THE 
28 
STATUS OF THE BRIDGE BANK IF' DEEMED NECESSARY TO 
29 
CONCLUDE PENDING NEGOTIATIONS FOR THE SALE, MERGER OR 
30 
ACQUISITION OF THE BRIDGE BANK BY A BUYER OR ACQUIRER: 
31 
PROVIDED, FINALLY, THAT THE MAXIMUM EXTENSION SHALL BE 
32 
ONE (1) YEAR. 
33 
(G) TERMINATION OF BRIDGE BANK. - THE STATUS OF ANY 
• 
34 
BRIDGE BANK AS SUCH SHALL TERMINATE UPON THE EARLIEST 
35 
OF-
36 
1. THE MERGER OR CONSOLIDATION OF THE BRIDGE 
37 
BANK WITH ANOTHER BANK THAT IS NOT A BRIDGE 
38 
BANK; OR 
23 
0, 


1 
2. THE SALE OF THE BRIDGE BANK TO A QUALIFIED 
2 
BUYER, AS MAY BE DETERMINED BY THE PDIC; OR 
3 
3. THE ASSUMPTION OF ALL OR SUBSTANTIALLY ALL OF 
, 
4 
THE (i) DEPOSITS AND OTHER LIABILITIES AND/OR (ii) 
5 
ASSETS OF THE BRIDGE BANK BY AN INSURED BANK 
6 
THAT IS NOT A BRIDGE BANK, D.R OTHER ENTITY AS 
7 
PERMITTED UNDER APPLICABLE LAW. FOLLOWING THE 
8 
ASSUMPTION OF ALL OR SUBSTANTIALLY ALL OF THE 
• 
9 
LIABILITIES OF THE BRIDGE BANK AND THE SALE OF 
10 
ALL OR SUBSTANTIALLY ALL OF THE ASSETS OF THE 
11 
BRIDGE 
BANK, 
THE 
BRIDGE 
BANK 
SHALL 
BE 
12 
LIQUIDATED IN ACCORDANCE WITH THE PROVISIONS OF 
13 
LAW RELATING TO THE LIQUIDATION OF CLOSED 
14 
BANKS; AND 
15 
4. THE EXPIRATION OF THE PERIOD PROVIDED IN 
16 
. PARAGRAPH (F), OR THE EARLIER DISSOLUTION OF THE 
17 
BRIDGE BANK AS PROVmED IN PARAGRAPH (H). 
18 
(H) DISSOLUTION OF BRIDGE BANK.-
NOTWITHSTANDING ANY 
19 
OTHER PROVISION OF LAW TO THE CONTRARY, IF THE BRIDGE 
20 
BANK'S STATUS AS SUCH HAS NOT PREVIOUSLY BEEN TERMINATED 
21 
BY THE OCCURRENCE OF AN EVENT SPECIFIED IN SUBPARAGRAPH 
22 
(1), (2) OR (3), OF PARAGRAPH (G), THE BOARD OF DIRECTORS OF 
! 
. 
23 
PDIC, MAY. DISSOLVE A BRIDGE BANK AT ANY TIME IT DEEMS 
, 
24 
NECESSARY. THE PDIC, AS SUCH RECEIVER, SHALL WIND UP THE 
25 
AFFAIRS OF THE BRIDGE BANK IN CONFORMITY WITH THE 
26 
PROVISIONS OF LAW RELATING TO THE LIQUIDATION OF CLOSED 
27 
BANKS. WITH RESPECT TO ANY SUCH BRIDGE BANK, THE PDIC, AS 
• 
28 
SUCH RECEIVER, SHALL HAVE ALL ~HE RIGHTS, POWERS, AND 
29 
PRIVILEGES, AND SHALL PERFORM THE DUTIES RELATED TO THE 
30 
EXERCISE OF SUCH RIGHTS, POWERS, OR PRIVILEGES GRANTED BY 
31 
LAW TO A RECEIVER OF ANY INSURED BANK. 
32 
(I) MATTERS RELATING TO THE EXERCISE BY THE PDIC OF 
33 
THE FUNCTIONS UNDER THIS SECTION SHALL BE SUBJECT TO 
34 
VISITORIAL AUDIT ONLY. 
35 
(J) THE ACTIONS OF THE PDIC UNDER THIS SECTION SHALL BE 
36 
FINAL AND EXECUTORY, AND MAY NOT BE RESTRAINED OR SET 
37 
ASIDE BY THE COURT, EXCEPT ON PETITION FOR CERTIORARI WITH 
38 
THE COURT OF APPEALS ON THE GROUND THAT THE ACTION WAS 
39 
TAKEN IN EXCESS OF JURISDICTION OR WITH SUCH GRAVE ABUSE 
24 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 ' 
34 
35 
36 
37 
OF DISCRETION AS TO AMOUNT TO' A LACK OR EXCESS OF 
JURISDICTION. THE PETITION FOR CERTIORARI MAY ONLY BE FILED 
WITHIN TEN (10) DAYS FROM PUBLICATION OF THE NOTICE ON THE 
ESTABLISHMENT OF A BRIDGE BANK. 
(K) THE PDlC SHALL PROMULGATE THE IMPLEMENTING 
RULES AND REGULATIONS TO IMPLEMENT THE PROVISIONS OF THIS 
SECTION." 
SEC.22, Section 33 of Republic Act No, 7653 is hereby amended to read as follows: 
"SEC. 33, 
Disposition of Banking Franchise, -
The Bangko Sentral may, if 
public interest so requires, award to an institution, upon such terms and conditions as 
the Monetary Board may approve, the banking fi<lnchise of a, CLOSED bank [llIlder 
! 
liquidation] to operate in the area where said baQl<: or its branches were previously 
operating: Provided, That whatever proceeds may b!, realized from such award shall be 
[subject to the appropriate exclusive disposition of the Monetary Board] FOR THE 
BENEFIT OF THE CREDITORS OF THE CLOSED BANK." 
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, 
, 
Rules, Regulations, Orders or Instructions, - Whtl\1ever a bank, [or] quasi-bank, OR 
OTHER FINANCIAL INSTITUTION WHICH UNDER THIS ACT OR 
SPECIAL LAWS IS SUBJECT TO BANGKO SENTRAL SUPERVISION or 
whenever any person or entity willfully violates this Act or other pertinent banking 
laws being enforced or implemented by the Bangko Sentral or any order, instruction, 
• 
rule or regulation issued by the Monetary Board, the person or persons responsible for 
such violation shall unless otherwise provided in this Act be pllllished by a fine of not 
less than Fifty Thousand Pesos (P50,000) nor more than [Two Hundred Thousand 
Pesos (P200,000)] TWO MILLION PESOS (P2,000,000.00) or by imprisonment of 
not less than two (2) years nor more than [ten (10)] SIX (6) years, or both, at the 
SOUND discretion of the court 
Whenever [a bank or quasi-bank]' AN ENTITY UNDER BANGKO 
SENTRAL SUPERVISION persists in carrying pn its business in an [unlawful or] 
unsafe or UNSOUND manner AS DETERMINED UNDER THE PROVISIONS 
OF SECTION S6 OF REPUBLIC NO. 8791 AND IT REFUSES OR FAILS TO 
CEASE AND DESIST FROM SUCH MISCONDUCT AND TO INSTITUTE 
CORRECTIVE MEASURES AFTER NOTICE HAS BEEN GIVEN BY THE 
BANGKO SENTRAL, the MONETARY Board may, without prejudice to the 
penalties provided in the preceding paragraph of this Section and the administrative 
sanctions provided in Section 37 of this Act, take adion under Section 30 of this Act" 
• 
25 


1 
SEC. 24. Section 37 of Republic Act No. 7653 is hereby a'mended to read as follows: 
, 
2 
"SEC. 37. Administrative Sanctions [On Banks And Quasi-Banks]. -
Without 
3 
prejudice to the criminal sanctions against the culpable persons provided in Sections 
4 
34, 35, and 36 of this Act, the Monetary Board may, at its discretion, impose 
5 
ADMINISTRATIVE SANCTIONS upon any b~ [or quasi-bank, their directors, 
6 
and/or officers, for any willful violation of its charter or by-laws, willful delay in the 
7 
submission of reports or publications thereof as reiuired by law, rules and regulations; 
8 
any refusal to permit examination into the affairs of the institution; any willful making 
9 
of a false or misleading statement to the Board or the appropriate supervising and 
10 
examining department or its examiners; any willful failure or refusal to comply with, 
11 
or violation of, any banking law or any order, instruction or regulation issued by the 
12 
Monetary Board, or any order, instruction or ruling by the Governor;] FINANCE 
13 
COMPANY AND NON-BANK FINANCIAL INSTITUTION PERFORMING 
14 
QUASI-BANKING FUNCTIONS, HEREINAFTER REFERRED TO AS 
15 
QUASI-BANKING INSTITUTIONS PERFORMING SIMILAR FUNCTIONS 
16 
REGULATED BY THE BANGKO SENTRAL UNDER THIS ACT OR UNDER 
17 
SPECIAL LAWS THAT ARE UNDER THE SUPERVISION OF THE BANGKO 
18 
SENTRAL FOR WILLFUL VIOLATION OR FAILURE TO COMPLY WITH 
, 
19 
THE PROVISIONS OF THIS ACT, OF REPUBLIC ACT NO. 8791 AND 
20 
OTHER SPECIAL LAWS; or any commission ·of irregularities, and/or conducting 
2i 
business in an unsafe or unsound manner as may be determined by the Monetary 
22 
Board the following administrative sanctions, [whenever] WHEREVER OR 
23 
WHICHEVER applicable. 
24 
THE FOLLOWING ADMINISTRATIVE SANCTIONS SHALL BE 
25 
IMPOSED 
TAKING 
INTO 
CONSIDERATION 
THE 
ATTENDANT 
26 
CIRCUMSTANCES SUCH AS THE NATURE AND GRAVITY OF THE 
, 
27 
VIOLATION OR IRREGULARITY AND THE SIZE OF THE BANK, QUASI-
28 
BANK OR NON-BANK FINANCIAL INSTITUTION INVOLVED. 
29 
(a) [fines] ADMINISTRATIVE PENALTIES in amounts as may be 
30 
PRESCRIBED AND determined by the Monetary Board to be appropriate, but in no 
• 
31 
case to exceed [Thirty Thousand Pesos (P30,OOO) a day for each violation, taking into 
32 
consideration the attendant circumstances, such 'as the nature and gravity of the 
'. 
33 
violation or irregularity and the size of the bank or quasi-bank;] THE MAXIMUM 
34 
PENALTIES 
PRESCRIBED 
HEREIN FOR EACH 
VIOLATION, 
AS 
35 
FOLLOWS: 
36 
1. FOR UNIVERSAL AND COMMERCIAL BANKS -
NOT 
37 
EXCEEDING PI0,OOO PER BANKING DAY; 
26 


1 
2. FOR THRIFT BANKS -
NOT EXCEEDING PS,OOO PER 
2 
BANKING DAY; 
3 
3. FOR RURAL BANKS/COOPERATIVE BANKS -
NOT 
4 
EXCEEDING P2,OOO PER BANKING DAY; 
5 
4. FOR FINANCE COMPANIES AND NON-BANK FINANCIAL 
6 
. INSTITUTIONS 
PERFORMING 
QUASI-BANKING 
7 
FUNCTIONS - NOT EXCEEDING PS,OOO PER BANKING DAY; 
8 
5. 
FOR 
FINANCE 
COMPANIES 
AND 
FINANCIAL 
9 
INSTITUTIONS WHICH ARE NOT PERFORMING QUASI-
10 
BANKING FUNCTIONS -' NOT EXCEEDING P3,OOO PER 
11 
BANKING DAY; 
12. 
6. FOR OTHER INSTITUTIONS THAT ARE SUPERVISED BY 
13 
THE BANGKO SENTRAL - NOT EXCEEDING P2,OOO PER 
14 
BANKING DAY. 
15 
WITHIN THE MAXIMUM PENALT'f PRESCRIBED HEREIN, FOR 
16 
VIOLATIONS 
OR 
IRREGULARILITIES, COMMITTED 
BY 
EVERY 
• 
17 
CATEGORY OF BANKS, QUASI-BANKS, AND NON-BANKS FINANCIAL 
18 
INSTITUTIONS AS HEREIN PROVIDED, THE MONETARY BOARD SHALL 
, 
19 
ACCORDING TO THE DEGREE OF SEVERITY OF VIOLATIONS OR 
20 
IRREGULARITIES SUBJECT TO PENALTIES, CLASSIFY VIOLATIONS 
• 
21 
OR IRREGULARITIES COMMITTED INTO GRAVE, LESS GRAVE AND 
22 
LIGHT OFFENSES SUCH THAT THE PENAUTIES TO BE IMPOSED SHALL 
" 
23 
CORRESPONDINGLY BE GRADUATED WITHIN THE PRESCRIBED 
24 
MAXIMUM PENAL TIES. 
25 
IN COMPUTING THE AFOREMENTIONED PENALTIES, THE 
26 
FOLLOWING ATTENDING CIRCUMSTANCES SHALL BE TAKEN INTO 
27 
CONSIDERATION: THE CAPITAL OF THE' INSTITUTION, THE NATURE 
28 
OF 
THE 
VIOLATION; 
A 
ONE-TIME 
VIOLATION 
VIS-A.-VIS 
A 
29 
CONTINUING VIOLATION OR OFFENSE; 
FREQUENCY OF THE 
30 
VIOLATION OR OFFENSE; AND THE GRAVITY OF THE OFFENSE 
31 
(GRAVE, LESS GRAVE AND LIGHT VIOLATIONS). GRAVE OFFENSES 
32 
ARE THOSE THAT HAVE SIGNIFICANTIMATERIAL IMPACT ON THE 
33 
SOLVENCY, LIQUIDITY AND/OR NET PROFITABILITY OF A BANK, 
34 
QUASI-BANK OR OTHER NON-BANK FINANCIAL INSTITUTION. 
35 
THE SUPERVISION AND EXAMINA,TION SECTOR CONCERNED 
36 
SHALL SUBMIT TO THE MONETARY BO~RD A MONTHLY REPORT OF 
37 
ADMINISTRATIVE PENALTIES IMPOSED ON INSTITUTIONS, IF ANY, 
38· 
INDICATING IN THE REPORT THE PENALTIES IMPOSED ON CERTAIN 
27 


1 
. 2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
35 
36 
37 
38 
. INSTITUTIONS; PENALTIES THAT HAVE BEEN COLLECTED; AND 
PENALTIES UNDER CONSIDERATION; 
(b) suspension of rediscounting privileges or access to Bangko Sentral credit 
facilities; 
(c) suspension of lending or foreign exchange operations or authority to accept 
new deposits or make new investments; AND/OR 
(d) suspension of interbank clearing privileges; [and/or] 
[(e) revocation of quasi-banking license.] 
Resignation or termination from office shall not exempt such director or officer 
from administrative or criminal sanctions. 
The Monetary Board may, whenever warranted by circumstances, preventively 
suspend any director or officer of [a bank or quasi-bank] THE INSTITUTION 
pending an investigation: Provided, That should thl" 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 suspension herein provided. 
The above administrative sanctions need not be applied in the order of their 
severity. 
Whether or not there is an administrative proceeding, if the institution and/or 
the directors and/or officers, concerned continu~ with or otherwise persist in the 
commission of the indicated practice or violation, the Monetary Board may issue an 
order requiring the institution and/or the director~, and/or officers concerned to cease 
and desist from the indicated practice or violation, and may further order that 
immediate action be taken to correct the conditions resulting from such practice or 
violation. The cease and desist order shall be immediately effective upon service on 
the respondents. 
The respondents shall be afforded an oPRortunity to defend their action in a 
! 
. 
hearing before the Monetary Board or any committee chaired by any Monetary Board 
, 
member created for the purpose, upon request made by the respondents within five (5) 
days from their receipt of the order. If no such hearing is requested within said period, 
, 
the order shall be final. If a hearing is conducted, all issues shall be determined on the 
basis of records, after which the Monetary Board may either reconsider or make final 
its order. 
[The Governor is hereby authorized, at his. discretion, to impose upon banking 
" 
institutions for any failure to comply with the requirements of law, Monetary Board 
regulations and policies, and/or instructions issued by the Monetary Board or by the 
28 


'. 
1 
Governor, fines not in excess of Ten thousand pesos (PIO,OOO) a day for each 
2 
violation, the imposition of which shall be final and executory until reversed, modified 
3 
or lifted by the Monetary Board on appeal.]" 
4 ,SEC. 25. Section 40 of Republic Act No. 7653 is hereby amended to read as follows: 
5 
"SEC. 54. 
[Reports.] APPEARANCE BEFORE CONGRESS. 
- [Before 
6 
the end of March of each year, the Bangko Sentral shall publish and submit to the 
7 
President and the Congress an annual report on the condition of the Bangko Sentral 
8 
including a review of the policies and measures adopted by the Monetary Board during 
9 
the past year and an analysis of the economic and financial circumstances which gave 
10 
rise to said policies and measures. 
11 
The annual report shall also include a statement of the financial condition of 
, 
, 
12 
the Bangko Sentral and a statistical appendix which shall present, as a minimum, the 
13 
following data:] THE BSP GOVERNOR SHALL APPEAR BEFORE THE 
14 
COMMITTEES ON APPROPRIATIONS, WAYS AND MEANS, ECONOMIC 
15 
AFFAIRS, AND BANKS AND FINANCIAL INTERMEDIARIES OF THE 
16 
HOUSE OF REPRESENTATIVES ON OR BEFORE THE 2ND TUESDAY OF 
17 
MARCH AND SEPTEMBER, AND; BEFORE THE COMMITTEES ON 
18 
FINANCE, WAYS AND MEANS, ECONOMIC AFFAIRS, AND BANKS, 
! 
' 
19 
FINANCIAL INSTITUTIONS AND CURRENCIES OF THE SENATE ON OR 
20 
BEFORE THE' 4TH TUESDAY OF MARCH AND SEPTEMBER TO REPORT 
, 
21 
ON THE STATUS AND DIRECTIONS OF THE FISCAL AND MONETARY 
22 
POLICIES OF THE GOVERNMENT, ECONOMIC DEVELOPMENTS AND 
23 
PROSPECTS FOR THE FUTURE, TAKING INTO ACCOUNT PAST AND 
24 
PROSPECTIVE DEVELOPMENTS IN EMPLOYMENT, UNEMPLOYMENT, 
25 
PRODUCTION, 
INVESTMENT, 
REAL. INCOME, 
PRODUCTIVITY, 
26 
EXCHANGE RATES, INTERNATIONAL TRADE AND PAYMENTS, AND 
27 
PRICES. 
28 
THE GOVERNOR OF THE BSP SHALL ALSO SUBMIT A WRITTEN 
29 
REPORT TO THE PRESIDENT AND TO THE COMMITTEES SPECIFIED IN 
30 
THE ABOVE PARAGRAPH WHICH SHALL INCLUDE, BUT SHALL NOT 
• 
31 
BE LIMITED TO, THE FOLLOWING: 
32 
(a) the monthly movement of monetary aggregates and their components; 
33 
(b) the monthly movement of purchases and sales of foreign exchange and of 
34 
the international reserves ofthe Bangko Sentral; 
35 
(c) balance of payments of the Philippines; 
36 
(d) monthly indices of consumer prices and of import and export prices; 
37 
(e) the monthly movement, in summary ''[onn, of exports and imports, by 
38 
volume and value; 
29 


· 
, 
1 
(f) the monthly movement of the accounts 'of the Bangko Sentral and of other 
2 
banks; 
3 
(g) the principal data on government receipts and expenditures and on the 
4 
status of the public debt, both domestic and foreign; [and] 
5 
(h) the texts of the major legal and administrative measures adopted by the 
6 
Government and the Monetary Board during the year which relate to the 
7 
functions or operations of the Bangko Sentral or of the financial system, 
8 
and; AND 
9 
(I) OTHER INFORMATION THAT !\'fAY BE REQUESTED BY THE 
10 
SAID COMMITTEES OF CONGRESS. 
11 
[The Bangko Sentral shall publish another'version of the annual report] THE 
12 
BSP SHALL MAKE AVAILABLE COPIES OF THE REPORTS SUBMITTED 
13 
TO CONGRESS IN THEIR OFFICIAL WEBSITES FOR A REASONABLE 
> 
14 
PERIOD IMMEDIATELY FOLLOWING THE SUBMISSION OF THE 
, 
15 
REPORTS in terms understandable to the layman." 
16 
Failure to comply with the reportorial requirements pursuant to this article 
17 
without justifiable reason as may be determined by .the Monetary Board shall cause the 
18 
withholding of the salary of the personnel concerned nntil the requirements are 
19 
complied with." 
20 
SEC. 26. Section 54 of Republic Act No. 7653 is hereby amended to read as follows: 
21 
"SEC. 54. Printing of Notes and Minting of Coins. -
The Monetary Board 
22 
shall prescribe the amounts of notes and coins to be printed and minted, respectively, 
23 
and the conditions to which the printing of notes' and the minting of coins shall be 
24 
subject. The Monetary Board shall have the authority to contract institutions, mints or 
25 
firms for such operations. 
26 
THE HEAD 
OF THE SECURITY>,PRINTING OF NOTES AND 
27 
MINTING OF COINS SHALL SUBMIT TO THE MONETARY BOARD 
28 
REGULAR REPORTS OF EACH AND EVERY PRINTING JOB OF NOTES 
29 
AND MINTING OF COINS WHETHER THE PRINTING OF NOTES AND 
30 
MINTING OF COINS IS DONE IN-HOUSE OR OUTSOURCED. A REPORT 
31 
SHALL 
BE 
SUBMITTED 
WITHIN 
THIRTY 
(30) 
DAYS 
FROM 
32 
COMPLETION OF PRINTING OF NOTES AND MINTING OF COINS IF IN-
33 
HOUSE AND WITHIN THIRTY (30) DAYS FROM THE DATE OF 
~ 
34 
DELIVERY 
TO 
THE 
BANGKO 
SENTRAL 
OFOUTSOURCED 
, 
35 
PRINTINGIMINTING JOB. 
'. 
36 
THE REGULAR REPORTS ON THE PRINTING OF NOTES/MINTING 
37 
OF COINS TO BE SUBMITTED TO THE 'MONETARY BOARD SHALL 
30 
'. 


1 
CONTAIN 
THE 
FOLLOWING 
MINIMUM 
INFORMATION 
PER 
2 
3 
4 
PRODUCTION JOB:. 
(A) 
THE 
VOLUME 
PRINTEDIMINTED: 
OF 
NOTES/COINS 
AS 
ACTUALLY 
'. 
5 
(B) THE NOTES AND COINS PRINTED/MINTED INDICATING THE 
6 
SERIAL NUMBERS AND YEAR MARK OF THE NOTES PRINTED AS 
7 
WELL AS THE YEAR MARK OF THE COINS; 
8 
(C) THE NAMES AND ADDRESSES OF THE ENTITIES THAT 
9 
PRINTED THE NOTES OR MINTED tHE COINS, IF OUTSOURCED; 
10 
OTHERWISE INDICATE IF THE NOTES AND COINS WERE 
11 
PRINTED/MINTED IN-HOUSE; 
12 
(D) PAPERS, INK AND OTHER RAW MATERIALS ORDERED VS. 
13 
PRODUCTION OUTPUT; 
14 
(E) PRODUCTION CAPACITY PER DENOMINATION VS. VOLUME 
15 
OF PRODUCTION OUTPUT; 
, 
16 
(F) 
DATES 
OF 
DELIVERY OF 
RAW 
MATERIALS 
FOR 
17 
PARTICULAR DENOMINATION AND DATES OF DELIVERY OF 
18 
PRINTED 
NOTES 
OR 
MINTED 
COINS 
TO 
THE 
CASH 
19 
DEPARTMENT; 
20 
(G) ALLOWANCE FOR WASTAGEVS. ACTUAL WASTAGE PER 
21 
PRODUCTION ORDER. THE RECORD OF WASTAGE SHALL 
22 
INCLUDE INFORMATION ON THE SHREDDING OF WASTAGE; 
23 
AND 
24 
(H) RUNNING BALANCE OF THE PARTICULAR DENOMINATION 
25 
pRINTEDIMINTED. 
26 
All expenses incurred in the printing of notes and the minting of coins shall be 
27 
for the account of the Bangko Sentral." 
28 
SEC. 27. Section 61 of Republic Act No. 7653 is hereby ffinended to read as follows: 
29 
"SEC. 61. Guiding Principle. -
THE MONETARY BOARD SHALL 
, 
30 
CONSTANTLY ASSESS PRICE DEVELOPMENTS AND OUTLOOK AND 
31 
BASED ON ITS ANALYSIS AND EVALUATION OF INFLATIONARY 
32 
PRESSURES USE ITS POLICY INSTRUMENTS PRICE STABILITY. 
33 
The Monetary Board shall endeavor to control any SIGNIFICANT expansion 
34 
or contraction in monetary aggregates which is prejudicial to the attainment or 
35 
maintenance of price stability." 
36 
SEC. 28. Section 81 of Republic Act No. 7653 is hereby amended to read as follows: 
37 
"SEC. 81. Guiding Principles. -
The rediscounts, discounts, loans and 
38 
advances which the Bangko Sentral is authorized to extend to banking institutions 
39 
AND OTHER SUPERVISED FINANCIAL INSTITUTIONS under the provisions 
31 


1 
of the present article of this Act shall be used. to influence the volume of credit 
2 
consistent with the MAINTENANCE OF FINANCIAL STABILITY AND THE 
3 
objective of price stability." 
4 
SEC. 29. Section 83 of Republic Act No. 7653 is hereby l,lmended to read as follows: 
5 
"SEC. 83. Loans for Liquidity Purposes. -
The Bangko Sentral, BY A VOTE 
6 
OF AT LEAST FIVE (5) MEMBERS OF THE MONETARY BOARD, may 
7 
extend loans and advances to [banking] BANKS, QUASI-BANKS AND OTHER 
8 
SYSTEMICALLY CRITICAL BANGKO SENTRAL-SUPERVISED institutions 
9 
for a period of not more than [seven (7)] FORTY-FIVE (45) BANKING days 
10 
without any collateral for the purpose of providing liquidity to the banking system in 
11 
times of need, SUBJECT TO SUCH TERM~ AND CONDITIONS AS THE 
12 
MONETARY BOARD MAY PRESCRIBE TO,MINIMIZE POSSIBLE LOSSES 
13 
TO THE BANGKO SENTRAL." 
14 
SEC. 30. Section 84 of Republic Act No. 7653 is hereby amended to read as follows: 
15 
"SEC. 84. Emergency Loans and Advances. -
In periods of national andlor 
16 
local emergency or of imminent financial panic which directly threaten monetary and 
17 
[banking] FINANCIAL stability, the Monetary Board may, by a vote of at least five 
18 
(5) of its members, authorize the Bangko Sentral to grant extraordinary loans or 
'. 
19 
advances to banking, QUASI-BANKING AND OTHER SYSTEMICALLY 
20 
CRITICAL BANGKO SENTRAL-SUPERVISED institutions TO BE secured by 
21 
assets as defined hereunder: PrOVided, That while such loans or advances are 
22 
outstanding, the debtor institution shall not, except upon prior authorization by the 
23 
Monetary Board, expand the total volume of its loans or investments. 
24 
The Monetary Board may, at its discretion, likewise authorize the Bangko 
25 
Sentral to grant emergency loans or advances to [banking] BANKS, QUASI-BANKS 
26 
AND 
OTHER 
SYSTEMICALLY 
CRInCAL 
BANGKO 
SENTRAL-
27 
SUPERVISED institutions, even during normal periods, for the purpose of assisting a 
28 
bank in a precarious financial condition or under serious financial pressures brought by 
29 
unforeseen events, or events which, though forese~able, could not be prevented by the 
30 
bank concerned: Provided, however, That the Monetary Board has ascertained that the 
31 
bank is not insolvent and has the assets defined, hereunder to secure the advances: 
32 
Provided,further, That a concurrent vote of at least five (5) members of the Monetary 
33 
Board is obtained. 
34 . 
The amount of any emergency loan or advance shall not exceed the sum of fifty 
35 
percent (50%) of total [deposits and deposit substitutes] BORROWINGS of the 
36 
[banking] institution and shall be disbursed in two (2) or more tranches. The amount 
~ 
. 
37 
of the first tranche shall be limited to twenty-five percent (25%) of the 
, 
38 
BORROWINGS [total deposit and deposit substitutes] of the institution and shall be 
32 


~ 
1 
secured by (A) government securities [to the extent of their applicable loan values 
2 
and]; (B) ACCEPTABLE GUARANTEES BACKED UP BY THE NATIONAL 
3 
GOVERNMENT OR ITS SECURITIES; (e! other unencumbered first class 
4 
collaterals AND (D) PRIVATE COMMERCIAL PAPER TO THE EXTENT OF 
5 
THEIR APPLICABLE LOAN VALUES which the Monetary Board may approve: 
• 
6 
Provided, That if as determined by the Monetary Board, the circumstances 
7 
surrounding the emergency warrant a loan or advance greater than the amount 
" 
8 
provided hereinabove, the amount of the first tranche may exceed twenty-five percent 
9 
(25%) of the 
[bank's] INSTITUTION'S total [deposit and deposit substitutes] 
10 
BORROWINGS i( the same is adequately secured by applicable loan values of 
11 
government securities and unencumbered first class collaterals OR ACCEPTABLE 
12 
GUARANTEES BACKED UP BY THE NATIONAL GOVERNMENT OR ITS 
13 
SECURITIES approved by the Monetary Board, and the principal stockholders of the 
14 
institution furnish an acceptable undertaking to indemnify and hold harmless from suit 
15 
a conservator whose appointment the Monetary BO!lrd may find necessary at any time. 
16 
Prior to the release of the first tranche, the [banking] institution shall submit to 
17 
the Bangko Sentral a resolution of its board of directors authorizing the Bangko 
18 
Sentral to evaluate 'other 'assets of the [banking] ,institution certified by its external 
19 
auditor to be good and available for collateral purposes should the release of the 
20 
subsequent tranche be thereafter applied for. 
21 
The Monetary Board may, by a vote of at least five (5) of its members, 
22 
authorize the release of a subsequent tranche on condition that the principal 
23 
stockholders of the institution: 
24 
(a) furnish an acceptable undertaking to indemnify and hold harmless from suit 
25 
a conservator whose appointment the Monetary Board may find necessary at 
~ 
. 
26 
any time; and 
, 
27 
(b) provide acceptable security which, in the judgment of the Monetary Board, 
28 
would be adequate to supplement, where necessary, the assets tendered by the 
29 
[banking] institution to collateralize the sUb'sequent tranche. 
30 
In connection with the exercise of these powers, the prohibitions in Section 128 
• 
31 
of this Act shall not apply insofar as it refers to aGceptance as collateral of shares and 
32 
their acquisition as a result of foreclosure proceedings, including the exercise of voting 
• 
33 
rights pertaining to said shares: Provided, however, That should the Bangko Sentral 
34 
acquire any of the shares it has accepted as collateral as a result of foreclosure 
35 
proceedings, the Bangko Sentral shall dispose of said shares by public bidding within 
36 
one (1) year from the date of consolidation oftitle by the Bangko Sentral. 
33 


1 
Whenever a financial institution incurs an overdraft in its account with the 
° 
2 
Bangko Sentral, the saine shall be eliminated within the period prescribed in Section 
3 
102 of this Act." 
4 
SEC. 31. A new section entitled Section 88-A of the same Act shall be inserted between Section 88 
5 
and Section 88-B which shall read as follows: 
6 
"SEC. 88-A. EXEMPTION FROM ATTACHMENT. THE PROVISIONS OF 
7 
ANY LAW TO THE CONTRARY NOTWITHSTANDING AND SECTION 31 
8 
OF THIS ACT, COLLATERALS ON LOANS AND ADVANCES GRANTED 
9 
BY 
THE 
BANGKO 
SENTRAL 
SHALL 
NOT 
BE 
SUBJECT 
TO 
10 
ATTACHMENT, EXECUTION OR ANY OTHER COURT PROCESS, NOR 
11 
SHALL THEY BE INCLUDED IN THE PROPERTY OF INSOLVENT 
12 
PERSONS OR INSTITUTIONS, UNLESS THE SECURED LOANS AND 
13 
ADVANCES GRANTED BY THE BANGKO SENTRAL TO INSOLVENT 
14 
PERSONS OR INSTITUTIONS OR A CLOSED INSTITUTION HAVE 
15 
ALREADY BEEN FULLY PAID IN WHI«H CASE. THE EXEMPTIONS 
16 
UNDER THIS SECTION SHALL NO LONGER APPLY." 
, 
17 
SEC. 32. A new section entitled Section 88-B of the same' Act shall be inserted between Section 88-
18 
A and Section 88-C which shall read as follows: 
, 
19 
"SEC. 88-B. DEPUTIZATION OF LEGAL STAFF. - IN CASE OF AN 
20 
EXTRAJUDICIAL FORECLOSURE OF MORTGAGE, THE BANGKO 
21 
SENTRAL MAY, DEPUTIZE ANY OF ITS LAWYERS TO CONDUCT THE 
22 
PUBLIC AUCTION PURSUANT TO ACT NO., 3135, AS AMENDED. IN CASE 
0, 
23 
OF A JUDICIAL FORECLOSURE, THE BANGKO SENTRAL MAY WITH 
24 
THE APPROVAL OF THE COURT, LIKEWISE DEPUTIZE ANY OF ITS 
25 
LAWYERS TO ACT AS SPECIAL SHERIFF IN THE SALE OF THE 
26 
DEBTOR'S PROPERTIES AND IN THE ENFORCEMENT OF COURT 
27 
WRITS AND PROCESSSES RELATED THEaETO. THE SPECIAL SHERIFF 
28 
OF THE BANGKO SENTRAL SHALL MAKE A REPORT TO THE PROPER 
29 
COURT AFTER ANY ACTION HAS BEEN TAKEN BY HIM, WHICH 
30 
COURT SHALL TREAT SUCH ACTION AS IF IT WERE AN ACT OF ITS 
31 
OWN SHERIFF IN ALL RESPECTS. 
32 
"NO RESTRAINING ORDER OR INJUNCTION SHALL BE ISSUED 
33 
BY 
THE 
COURT 
ENJOINING 
THE 
BANGKO 
SENTRAL 
FROM 
34 
PROCEEDING WITH THE FORECLOSURE 'OF THE MORTGAGE UNLESS 
35 
A BOND IS POSTED IN FAVOR OF THE BANGKO SENTRAL IN AN 
36 
AMOUNT EQUIVALENT TO THE TOTAL CLAIM OF THE BANGKO 
37 
SENTRAL. 
THE RESTRAINING ORDER OR INJUNCTION SHALL BE 
38. 
REFUSED OR, IF GRANTED, SHALL BE DISSOLVED UPON FILING BY 
39 
THE BANGKO SENTRAL OF A BOND, WHICH SHALL BE IN THE FORM 
34 


1. 
2 
3 
4 
5 
6 
7 
8 
9 
OF A BANGKO SENTRAL CHECK, IN AN AMOUNT TWICE THE AMOUNT 
OF THE ORIGINAL BOND POSTED CONDITIONED THAT THE BANGKO 
SENTRAL WILL PAY THE DAMAGES WHICH THE PARTY MAY SUFFER 
BY THE REFUSAL OR DISSOLUTION ~F THE INJUNCTION. 
THE 
PROVISIONS OF RULE 58 OF THE NEW RULES OF COURT INSOFAR AS 
, 
THEY ARE APPLICABLE AND NOT "INCONSISTENT WITH THE 
PROVISIONS OF THIS SECTION SHALL GOVERN THE ISSUANCE AND 
DISSOLUTION OF THE RESTRAINING ORDER OR INJUNCTION 
CONTEMPLATED IN THIS SECTION." 
• 
10 
11 
12 
13 
14 
15 
16 
SEC. 33. A new section entitled Section 88-C of the same. Act shall be inserted between Section 88-
17 
B and Section 89 which shall read as follows: 
'. 
"SEC. 88-C. 
RIGHT OF REDEMPTION OF FORECLOSED REAL 
PROPERTY; RIGHT OF POSSESSION DURING REDEMPTION PERIOD. -
THE MORTGAGOR SHALL HAVE THE' RIGHT TO REDEEM THE 
PROPERTY WITHIN ONE YEAR FROM THE DATE OF FORECLOSURE 
SALE OF THE REAL ESTATE, IN CASE THE MORTGAGOR IS A 
NATURAL PERSON, AND WITHIN NINETY DAYS BUT NOT LATER THAN 
18 
THE 
DATE 
OF 
REGISTRATION 
OF 
THE 
CERTIFICATE 
OF 
19 
FORECLOSURE SALE, IN CASE THE MORTGAGOR IS A JURIDICAL 
20 
PERSON. REDEMPTION SHALL BE EFFECTED BY PAYING THE 
21 
PRINCIPAL, INTERESTS, CHARGES, COMMISSIONS AND ALL CLAIMS 
22 
OF WHATEVER NATURE OF THE BANGKO SENTRAL OUTSTANDING 
23 
AND DUE AS OF THE DATE OF FORECLOSURE SALE, INCLUDING ALL 
24 
COSTS AND OTHER EXPENSES INCURRED BY REASON OF THE 
25 
FORECLOSURE SALE AND CUSTODY OF THE PROPERTY. 
26 
THE BANGKO SENTRAL, AS PURCHASER IN THE FORECLOSURE 
27 
SALE AND WITHOUT NEED OF POSTING A BOND, MAY TAKE 
28 
POSSESSION 
OF THE 
FORECLOSED 
PROPERTY 
DURING 
THE 
29 
REDEMPTION PERIOD. THE BANGKO SENTRAL SHALL BE ENTITLED 
30 
TO THE FRUITS OF THE PROPERTY, ['HE SAME TO BE APPLIED 
31 
AGAINST THE REDEMPTION PRICE." 
• 
32 
SEC. 34. A new section entitled Section 89-A of the sameAct shall be inserted between Section 89 
33 
and Section 90 which shall read as follows: 
34 
"SEC. 89-A. CREDIT FACILITIES FOR ISLAMIC BANKS. -THE BANGKO 
35 
SENTRAL MAY, TAKING INTO CONSJpERATION THE PECULIAR 
36 
CHARACTERISTICS OF ISLAMIC BANKING, FORMULATE RULES AND 
37 
REGULATIONS FOR THE EXTENSION OF REDISCOUNTING OR OTHER 
" 
38 
SIMILAR FACILITIES TO ISLAMIC BANKS." 
39 
SEC. 35. Section 92 of Republic Act No. 7653 is hereby amended to read as follows: 
35 


0, 
1 
"SEC. 92. Issue and Negotiation of Bangko Sentral Obligations. -
In order to 
2 
provide the Bangko Sentral with effective instruments for open market operations, the 
3 
Bangko Sentral may, subject to such rules and regulations as the Monetary Board may 
4 
prescribe and in accordance with the principles stated in Section 90 of this Act, issue, 
5 
place, buy and seH freely negotiable evidences of.indebtedness of the Bangko Sentral. 
6 
[: Provided, That issuance of such certificates of indebtedness shaH be made only in 
7 
cases of extraordinary movement in price levels.] Said evidences of indebtedness may 
8 
be issued directly against the international reserve .of the Bangko Sentral or against the 
9 
securities which'it has acquired under the provisions of Section 91 of this Act, or may 
10 
be issued without relation to specific types of assets of the Bangko Sentral. 
11 
The Monetary Board shaH determine the. interest rates, maturities and other 
12 
characteristics of said obligations of the Bangko Sentral, and may, if it deems it 
13 
advisable, denominate the obligations in gold or foreign currencies. 
14 
Subject to the principles stated in Section 90 of this Act, the evidences of 
15 
indebtedness of the Bangko Sentral to which this Section refers may be acquired by the 
16 
Bangko Sentral before their maturity, either through purchases in the open market or 
17 
through redemptions at par and by lot if the Bangko Sentral has reserved the right to 
18 
make such redemptions. The evidences of indebtedness acquired or redeemed by the 
• 
19 
Bangko Sentral shaH not be included among its assets, and shaH be immediately retired 
20 
and canceHed. 
21 
THE BANGKO SENTRAL IN PURSUIT OF ITS OPEN MARKET 
22 
OPERATIONS, MAY ALSO ENGAGE IN THE PURCHASE AND RESALE OF 
23 
READILY 
MARKETABLE 
COMMERCIAL 
PAPERS 
ISSUED 
BY 
24 
FINANCIAL INSTITUTIONS DULY ACCREDITED UNDER SUCH RULES 
25 
AND REGULATIONS AS THE MONETARY BOARD MAY PRESCRIBE TO 
, 
26 
PROVIDE LIQUIDITY TO THE FINANCIA'L MARKETS FROM TIME TO 
27 
TIME. SUCH PURCHASE AND 
RESALE MAY BE SUBJECT TO 
28 
REPURCHASE OR REVERSE REPURCHi).SE AGREEMENTS AS THE 
29 
BANGKO SENTRAL SHALL STIPULATE AND SUCH INSTRUMENTS ARE 
30 
PART OF THE OPEN MARKET OPERATIONS OF THE BANGKO 
31 
SENTRAL." 
32 
SEC. 36. Section 95 of Republic Act No. 7653 is hereby amended to read as foHows: 
33 
"SEC. 95. Definition of Deposit Substitutes. -
The term "deposit substitutes" 
34 
IS defined as an alternative form of obtaining funds from the public, other than 
35 
deposits, through the issuance, endorsement, or acceptance of debt instruments for the 
36 
borrower's own account, for the purpose of rei ending or purchasing of receivables and 
37 
other obligations. These instruments may include"but need not be limited to, bankers 
38 
acceptances, promissory notes, participations, certificates of assigmnent and similar 
36 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
30 
31 
32 
33 
34 
35 
36 
37 
, 
instruments with recourse, [and repurchase agreements.] PROVIDED, HOWEVER, 
THAT REPURCHASE AGREEMENTS, INCLUDING REVERSE PURCHASE 
AGREEMENTS ENTERED INTO BY THE BANGKO SENTRAL SHALL NOT 
BE CONSIDERED DEPOSIT SUBSTITUTES. 
IN THE COMPUTATION OF THE RESERVES AGAINST DEPOSIT 
SUBSTITUTES UNDER SECTION 94 OF THIS ACT, THE MONETARY 
BOARD SHALL DETERMINE WHAT SHALL BE CONSIDERED AS 
DEPOSIT SUBSTITUTES SUBJECT TO RESERVE REQUIREMENTS. 
FINANCIAL INSTRUMENTS ISSUED BY THE NATIONAL GOVERNMENT 
• 
AND THE BANGKO SENTRAL AND INTERBANK BORROWINGS SHALL 
NOT BE CONSTRUED AS DEPOSIT SUBSTITUTES. 
The Monetary Board shall determine what specific instruments shall be 
considered as deposit substitutes for the purposes 'of Section 94 of this Act[:J. THE 
MONETARY BOARD MAY ALSO EXCLUDE FUNDS OBTAINED OR 
, 
BORROWED FROM CERTAIN INSTITUnONAL LENDERS FROM THIS 
SECTION: Provided, however, That deposit substitutes of commercial, industrial and 
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: 
"SEC. 99. Adjustment [Increase] in Reserve Requirements. -
Whenever in the 
opinion of the Monetary Board it becomes necessary to ADJUST [increase] reserve 
requirements against existing liabilities, the [increase] CHANGE shall be made In a 
[gradual] manner [and shall not exceed four percentage points in any thirty-day 
period] CONSISTENT WITH THE MONETARY POLICY DETERMINED BY 
. 
, 
THE MONETARY BOARD. Banks and other affected financial institutions shall be 
notified reasonably in advance of the ,date on which such [increase] CHANGE is to 
become effective." 
SEC. 38. Section 113 of Republic Act No. 7653 is hereby amended to read as follows: 
"SEC. 113. Official Deposits. -
The Bangko Sentral shall be the official 
depository of the Government, its political subdivisions and instrumentalities as well 
as of government-owned or controlled corporatiops. [and, as a general policy, their 
cash balances should be deposited with the Bat,Jgko Sentral, with only minimum 
working balances to be held by government-owned banks and such other banks 
incorporated in the Philippines as the Monetary Board may designate, subject to such 
, 
rules and regulations as the Board may prescribe: Provided, That such banks may hold 
deposits of the political subdivisions and instrumentalities of the Government beyond 
• 
" 
37 


1 
their minimum working balances whenever such subdivisions or instrumentalities have 
2 
o\ltstanding loans with said banks.] 
. 
3 
EXCEPT FOR DEMAND DEPOSITS, the Bangko Sentral [may] SHALL pay 
, 
4 
interest on deposits of the Govermnent or 'of its political subdivisions and 
5 
instrumentalities, as well as on deposits of banks with the Bangko Sentral." 
6 
SEC. 39. Section 117 of Republic Act No. 7653 is hereby amended to read as follows: 
7 
"SEC. 117. Issue of Government Obligations. -
The issue of securities 
8 
representing obligations of the 
Government, 
its 
political 
subdivisions 
or 
, 
9 
instrumentalities, may be made through the Bangko Sentral, which may act as agent of, 
10 
and for the account of, the Government or its respective subdivisions or 
11 
instrumentality, as the case may be: Provided, however, That the Bangko Sentral shall 
12 
not guarantee the placement of said securities, and shall not subscribe to their issue 
13 
except to replace its maturing holdings of securities with the same type as the maturing 
14 
securities. 
15 
THE PRIMARY SALE OF GOVERNM,ENT SECURITIES MAY ALSO 
16 
BE PUBLICLY UNDERWRITTEN BY, OR PRIVATELY PLACED IN, 
17 
FINANCIAL INSTITUTIONS ACCREDITED BY THE DEPARTMENT OF 
18 
FINANCE OF THE NATIONAL GOVERNMENT. 
19 
THE 
DIRECT 
PURCHASE 
AND 
SALE 
OF 
GOVERNMENT 
20 
SECURITIES BY AND BETWEEN AND AMONG ACCREDITED FINANCIAL 
21 
INSTITUTIONS SHALL BE DEEMED EXEMPT TRANSACTIONS UNDER 
22 
REPUBLIC ACT NO. 8799, OTHWERISE KNOWN AS THE SECURITIES 
! 
23 
REGULATION 
CODE. 
THE 
SECRETARY 
OF 
FINANCE, 
IN 
24 
CONSULTATION WITH THE BANGKO SENTRAL, SHALL PROMULGATE 
25 
SUCH RULES AND REGULATIONS, ORDERS OR INSTRUCTIONS WHICH 
. 
26 
SHALL PROTECT FROM FRAUD THE REPUBLIC OF THE PHILIPPINES, 
27 
AS ISSUER AND THE ACCREDITED FINANCIAL INSTITUTIONS AS 
" 
28 
INVESTORS OR TRADERS OF SAID GOVEJ,rnMENT SECURITIES. 
29 
IN ORDER TO INSURE THAT SAID ACCREDITED FINANCIAL 
30 
INSTITUTIONS 
SHALL 
OPERATE UNDER 
FAIR AND 
UNIFORM 
31 
TRADING RULES, THEY SHALL, AS PART OF THE GUIDELINES OF 
32 
ACCREDITATION, BE REQUIRED TO JOIN AN ASSOCIATION OF 
33 
ACCREDITED FINANCIAL INSTITUTIONS TO BE GOVERNED BY 
34 
INTERNAL RULES OF CONDUCT APPROVED BY THE SECRETARY OF 
, 
35 
FINANCE, THE LATTER BEING THE OFFICIAL REPRESENTATIVE OF 
36 
THE REPUBLIC OF THE PHILIPPINES, THE PRIMARY OBLIGOR IN THE 
37 
ISSUANCE OF SAID GOVERNMENT SECURITIES; PROVIDED, HOWEVER, 
38 
THAT THE DIRECT PARTICIPATION OF ACCREDITED FINANCIAL 
38 


1 
INSTITUTIONS IN THE OPEN MARKET OfERATIONS OF THE BANGKO 
2 
SENTRAL AS PROVIDED IN SECTIONS 90 AND 91 HEREIN SHALL BE 
3 
SUBJECT TO SUCH RULES 
AND 
REGULATIONS 
AS 
MAY 
BE 
4 
PRESCRIBED BY THE MONETARY BOARD, IN CONSULTATION WITH 
5 
THE SECRETARY OF FINANCE." 
6 
SEC. 40. Section 118 of Republic Act No. 7653 is hereby, amended to read as follows: 
'7 
"SEC. 118. Methods of Placing Governme~t Securities. -
The Bangko Sentral 
8 
may place the securities to which the FIRST PARAGRAPH OF THE preceding 
9 
Section refers through direct sale to financial institutions [and the public]. 
10 
The Bangko Sentral shall not be a member of any stock exchange or syndicate, but 
11 
may intervene therein; IN COORDINATION WITH THE DEPARTMENT OF 
. 
. 
12 
FINANCE, for the sole purpose of regulating "their operations in the placing of 
13 
government securities. 
14 
The Government, or its political subdivisions or instrumentalities, shall 
15 
reimburse the Bangko Sentral for the expenses incurred in the placing of the aforesaid 
16 
securities." 
17 
SEC. 41. Section 119 of Republic Act No. 7653 is herebY,amended to read as follows: 
18 
"SEC. 119. Servicing and Redemption ofthfi Public Debt. -
The servicing and 
19 
redemption of the public debt shall also BE DONE UNDER THE AUT~ORITY OF 
20 
THE DEPARTMENT OF FINANCE. IT MAY also be effected through the Bangko 
21 
Sentral. 
22 
SEC. 42. Section 125 of Republic Act No. 7653 is hereby amended to read as follows: 
23 
"SEC. 125. Tax Exemptions. -
THE PROVISIONS OF ANY GENERAL 
, 
24 
OR SPECIAL 
LAW 
TO 
THE 
CONTRARY 
NOTWITHSTANDING, 
25 
FINANCIAL TRANSACTIONS OF the Bangko Sentral ARISING FROM ITS 
26 
OPEN MARKET OPERATIONS shall be exempt [for a period of five (5) years 
27 
from the approval of this Act] from all national, AND LOCAL [provincial, muniCipal 
28 
and city] taxes, fees, charges and assessments. 
29 
[The exemption authorized in the preceding paragraph of this Section shall 
, 
30 
apply to all property of the Bangko Sentral, to the resources, receipts, expenditures, 
31 
profits and income of the Bangko Sentral, as well as to all contracts, deeds, documents 
32 
and transactions related to the conduct of the business of the Bangko Sentral: 
33 
Provided, however, That said exemptions shall apply only to such taxes, fees, charges 
34 . 
and assessments for which the Bangko Sentral itself would otherwise be liable, and 
35 
shall not apply to taxes, fees, charges, or assessments payable by persons or other 
36 
entities doing business with the Bangko Sentral: Provided, further, That foreign loans 
37 
and other obligations of the Bangko Sentral shall ~be exempt, both as to principal and 
39 


• 
1 
interest, from any and all taxes if the payment of such taxes has been assumed by the 
2 
Bangko Sentra!.]" 
3 
SEC. 43. Section 126 of Republic Act No. 7653 is hereby amended to read as follows: 
4 
"SEC. 126. Exemptionfrom Customs Dudes. -
The provision of any general 
5 
or special law to the contrary notwithstanding, the importation and exportation by the 
6 
Bangko Sentral of notes and coins, and of gOI? and other metals to be used for 
7 
purposes authorized under this Act, and the. importation of all [equipment] 
'. 
8 
SUPPLIES needed [for] BY THE BANGKO SENTRAL FOR bank note 
9 
production, minting of coins, metal refining and other security printing operations 
10 
AND TRANSPORT OF CURRENCY shall be fully exempt from all customs duties 
11 
and consular fees and from all other taxes, assessments and charges related to such 
12 
importation or exportation. 
13 
THE IMPORTATION OF MACHINERY OR EQUIPMENT REQUIRED 
14 
BY THE BANGKO SENTRAL FOR THE PRINTING OF NOTES AND THE 
15 
MINTING OF COINS SHALL BE SUBJECT TO CUSTOMS DUTIES AND 
16 
OTHER RELATED ASSESSMENTS AND CHARGES RELATED TO THE 
17 
IMPORTATION OF ANY SUCH MACHINERY OR EQUIPMENT." 
18 
SEC. 44. A new section entitled Section 126-A of Republic Act No. 7653 shall be inserted between 
19 
Section 126 and Section 127 which shall read as follows: '. 
20 
"SEC. 126-A. ACQUISITIONS SUBJEr;T TO PROCUREMENT LAW. -
21 
ANY AND ALL ACQUISITION OF GOODS AND SERVICES BY THE 
22 
BANGKO SENTRAL SHALL BE SUBJECT TO THE PROCUREMENTS 
23 
LAWS." 
24 
SEC. 45. Separability Clause. - If any part or provision of this Act shall be held to be 
25 
unconstitutional or invalid, other parts or provisions hereof which are not affected thereby shall 
26 
continue to be in full force and effect. 
27 
SEC. 46. Repealing Clause. - All laws, decrees, executive orders, rules and regulations, or parts 
• 
28 
thereof which are inconsistent with this Act are hereby repealed, amended or modified accordingly. 
29 
SEC. 47. Effectivity. - This Act shall take effect fifteen days (15) days following its publication in 
30 
at least two (2) newspapers of general circulation or the Official Gazette. 
Approved. 
'. 
40