Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
19th CONGRESS 
Third Regular Session 
HOUSE BILL NO.  10721 
___________________________________________________________________________ 
Introduced by REP. BERNADETTE “DETTE” G. ESCUDERO 
___________________________________________________________________________ 
AN ACT  
PROVIDING FOR A NEW CHARTER FOR THE LAND BANK OF THE PHILIPPINES 
EXPLANATORY NOTE 
This bill seeks to modernize and strengthen the Land Bank of the Philippines (LBP) through the 
enactment of a new charter. 
Established on 8 August 1963 under Republic Act No. 3844, also known as the Agricultural Land 
Reform Code, the LBP is a government financial institution dedicated to advancing the socio-economic 
development agenda of the national government. The bank plays a pivotal role in the nation’s 
agricultural and rural development, focusing on broad-based support for small farmers, fisherfolk, 
micro, small, and medium enterprises, rural financial institutions, government-owned and controlled 
corporations, and agrarian reform beneficiaries. 
Through financing interventions, the LBP enhances the quality of life in communities by funding 
infrastructure and social service projects. These initiatives include the provision of farm-to-market 
roads, hospitals, schools, and housing developments, as well as the improvement of communication 
systems, transportation networks, clean water access, and househoold electrification. The proposed 
expansion of its powers and functions will enable the LBP to provide more comprehensive support for 
agricultural and industrial initiatives, foster financial inclusion, and support the most vulnerable sectors 
in the agriculture industry. 
This legislative measure is not merely an update but a transformative step toward fortifying 
the Land Bank of the Philippines as an instrument of national development. It envisions a landscape 
where the seeds of financial inclusion are sown across the fertile fields of our nation, nurturing a harvest 
of sustainable growth and prosperity. This bill is crafted with the foresight to empower rural 
communities and foster a robust agricultural economy, reflecting a vision where financial inclusion and 
countryside growth are not just ideals but attainable realities. 
In view of the foregoing, this bill is filed for Congress’ immediate consideration and approval. 
Respectfully submitted. 
 BERNADETTE “DETTE” G. ESCUDERO 
August 5, 2024
5:09 pm


2 
Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
19th CONGRESS 
Third Regular Session 
HOUSE BILL NO.  10721 
___________________________________________________________________________ 
Introduced by REP. BERNADETTE “DETTE” G. ESCUDERO 
___________________________________________________________________________ 
AN ACT  
PROVIDING FOR A NEW CHARTER FOR THE LAND BANK OF THE PHILIPPINES 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
SECTION. 1. Short Title. – This Act shall be known as “Land Bank of the Philippines 
1 
Charter of 2024”. 
2 
SEC. 2. Purpose and Domicile. – The Land Bank of the Philippines, hereinafter referred 
3 
to as the "Bank", operating under the provisions of Republic Act (RA) No. 3844, as amended, 
4 
otherwise known as the "Agricultural Land Reform Code", shall henceforth operate under the 
5 
provisions of this Act as a government financial institution responsible for broad-based 
6 
agricultural, rural and industrial development while promoting accelerated financial inclusion. 
7 
It shall provide accessible and innovative solutions to deliver timely and responsive financial 
8 
and support services to rural financial institutions as well as small farmers, fisherfolk and 
9 
agrarian reform beneficiaries (ARBs) as well as provide banking services principally to service 
10 
the medium- and long-term needs of agricultural and industrial enterprises. The Bank shall 
11 
remain to be a body corporate and shall have perpetual existence. It shall be supervised by 
12 
the Bangko Sentral ng Pilipinas (BSP), taking into account its mandated roles of spurring 
13 
countryside development and supporting the country's financial inclusion objectives. 
14 
The principal office and place of business of the Bank shall be in Metro Manila. It may, 
15 
however, open and maintain branches, agencies or other offices at such places in the 
16 
Philippines as its Board of Directors may deem advisable, with the prior approval of the 
17 
Monetary Board of the BSP. 
18 


 
3 
 
Subject to applicable laws, rules and regulations, the Bank shall provide banking 
1 
services with a social mission of spurring countryside development by granting loans to finance 
2 
the agricultural projects and national government’s developmental projects, including but not 
3 
limited to the following: 
4 
(a) off-farm/fishery entrepreneurial activities; 
5 
(b) agricultural mechanization/ modernization; 
6 
(c) agri-tourism; 
7 
(d) sustainable projects; 
8 
(e) digitalization/automation of farming, fishery, and agri-business activities and 
9 
processes, including related financial and management information systems; 
10 
(f) public rural infrastructure; 
11 
(g) home-building or home-financing projects;  
12 
(h) programs that shall: (a) promote the health and wellness of farmers, 
13 
fisherfolk and ARBs, including members of their households, such as water and 
14 
sanitation projects for rural communities; and/or (b) address the developmental 
15 
needs of rural communities, such as, but not limited to, projects that promote the 
16 
livelihood, skills enhancement, financial literacy, including digital financial literacy, 
17 
and other capacity-building activities of the rural community beneficiaries; 
18 
(i) activities 
identified 
under 
the 
Agro-lndustry 
Modernization 
Credit 
and 
19 
Financing Program (AMCFP) under Title l, Chapter 3, Section 23 of R.A. No. 8435, 
20 
otherwise known as the "Agriculture and Fisheries Modernization Act of 1997, as 
21 
follows: 
22 
(1) Agriculture and fisheries production including processing of fisheries and 
23 
agri-based products and farm inputs; 
24 
(2) Acquisition of work animals, farm and fishery equipment and machineries; 
25 
(3) Acquisition of seeds, fertilizers, poultry, livestock, feeds and other similar 
26 
items; 
27 
(4) Procurement of agriculture and fisheries products for storage, trading, 
28 
processing and distribution; 
29 
(5) Acquisition of water pumps and installation of tube wells for irrigation; 
30 
(6) Construction, acquisition and repair of facilities for production, processing, 
31 
storage, transportation, communication, marketing and such other facilities 
32 
in support of agriculture and fisheries; 
33 


 
4 
 
(7) Working capital for agriculture and fisheries graduates to enable them to 
1 
engage in agriculture and fisheries-related economic activities; 
2 
(8) Agribusiness activities which support soil and water conservation and 
3 
ecology-enhancing activities; 
4 
(9) Privately-funded and Local Government Unit (LGU)-funded irrigation systems 
5 
that are designed to protect the watershed; 
6 
(10) Working capital for long-gestating projects; and 
7 
(11) Credit guarantees on uncollateralized loans to farmers and fisherfolk. 
8 
(j) industrial development projects; and 
9 
(k) other projects on productive enterprises. 
10 
SEC. 3. General Powers. – The Bank shall have the power to: 
11 
(a) Prescribe, repeal and alter its own by laws, to determine its operating policies, and 
12 
to issue such rules and regulations as may be necessary; 
13 
(b) Adopt, alter and use a corporate seal; 
14 
(c) Hold, purchase, acquire and own real and personal property, introduce necessary 
15 
improvements thereon to enhance and develop their social and economic value, 
16 
and to sell, mortgage or otherwise dispose of the same; 
17 
(d) Sue and be sued, make contracts, negotiate and secure loans from both local and 
18 
foreign sources. Before undertaking any such credit operation, the Bank, through 
19 
the Secretary of Finance, shall request the opinion, in writing, of the Monetary 
20 
Board on the monetary implications of the contemplated action. All loans from 
21 
foreign sources shall be subject to approval by the President of the Philippines and 
22 
shall be fully guaranteed by the Philippine Government; 
23 
(e) Grant short, medium and long-term loans and advances against security of real 
24 
estate or other acceptable assets for the establishment, development or expansion 
25 
of agricultural, industrial, home building or home financing projects and other 
26 
productive enterprises; 
27 
(f) Grant loans to farmers’ cooperatives and associations to facilitate farm production, 
28 
marketing of crops and acquisition of essential commodities; 
29 
(g) Underwrite, hold, own, purchase, acquire, sell, mortgage, dispose or otherwise 
30 
invest or reinvest in stocks, bonds, debentures, securities and other evidences of 
31 
indebtedness and ownership of other corporations and the government or its 
32 


 
5 
 
instrumentalities which are issued for or in connection with any project or 
1 
enterprise; 
2 
(h) Guarantee acceptances, credits, loans, transactions or obligations of any person, 
3 
co-partnership, association or corporation in favor of any financing or banking 
4 
institution, whether foreign or domestic: Provided, That the proceeds of such 
5 
acceptances, credits, loans, transactions or obligations are utilized or earmarked 
6 
for the development and/or expansion of agriculture and industry, the provision 
7 
of any law to the contrary notwithstanding; 
8 
(i) Obtain from the Government Service Insurance System (GSIS) or other reputable 
9 
insurance companies duly accredited by the appropriate regulatory body, 
10 
directors, officers and liability insurance coverage, without prejudice to the right 
11 
of the Bank, as may be determined by its Board of Directors, to put up its own 
12 
legal insurance fund; 
13 
(j) Borrow from, or rediscount notes, bills of exchange and other credit instruments 
14 
with the BSP subject to the provisions of Chapter IV of RA No. 7653, as amended 
15 
by RA No. 11211, otherwise known as “The New Central Bank Act”, and relevant 
16 
BSP rules and regulations; 
17 
(k) Act as a trustee, or administer any trust or hold property in trust in accordance 
18 
with the provisions of law governing trust corporations; 
19 
(l) Act as an official government depository with full authority to maintain deposits of 
20 
the government, its branches, subdivisions and instrumentalities, and of 
21 
government owned or -controlled corporations which deposits shall be subject to 
22 
liquidity floor or reserve requirements as may be imposed by the Monetary Board 
23 
upon other commercial banks; 
24 
(m) Provide continuing assistance through credit and capacity building to farmers and 
25 
fishers cooperatives, associations and organizations nationwide; 
26 
(n) Offer and issue common and preferred shares of stocks in such manner and in 
27 
such quantities as approved by the Secretary of Finance upon the recommendation 
28 
of the Board of Directors and in accordance with applicable laws, rules and 
29 
regulations; 
30 
The holders of preferred shares of stock shall be nonvoting. Other features of 
31 
preferred shares shall be determined by the Board of Directors in accordance with 
32 
applicable laws and regulations; and 
33 
 
34 


 
6 
 
(o) Exercise the general powers provided for in RA No. 11232, otherwise known as 
1 
the “Revised Corporation Code of the Philippines”, insofar as they are not 
2 
inconsistent or incompatible with this Charter. 
3 
SEC. 4. Issuance of Bonds. – The Bank shall, upon the approval of the Board of 
4 
Directors, issue all kinds of bonds, debentures, securities, collaterals and other evidence of 
5 
indebtedness and/or the renewal or refunding thereof; at such terms, rates and conditions as 
6 
the Bank may determine, up to an aggregate amount not exceeding, at any one time, ten 
7 
times its paid-in capital and surplus, subject to compliance with the provisions of applicable 
8 
law, and rules and regulations promulgated by the Monetary Board. 
9 
These bonds and other obligations shall be redeemable at the option of the Bank at or 
10 
before maturity and in such manner as may be stipulated therein and shall bear such rate of 
11 
interest as may be fixed by the Bank. Such obligations shall be secured by the assets of the 
12 
Bank including the stocks, bonds, debentures, and other securities underwritten, purchased 
13 
or held by it under the provisions of this Charter. Such obligations may be issued in payment 
14 
or replacement of certain assets transferred to the Bank or offered for sale at such price or 
15 
prices as the Bank may determine, and may, subject to the approval of the President of the 
16 
Philippines, be fully guaranteed by the Government of the Republic of the Philippines, and 
17 
such guarantee shall be expressed on the face thereof. 
18 
These instruments of indebtedness shall be negotiable and may be mortgaged in 
19 
accordance with established banking procedures and practices with government institutions, 
20 
their existing charters and existing law to the contrary notwithstanding, to enable the holders 
21 
of such bonds to make use of them in investments in productive enterprises. The Board of 
22 
Directors shall have the power to prescribe rules and regulations for the issuance, reissuance, 
23 
servicing, placement and redemption of the bonds herein authorized to be issued as well as 
24 
the registration of such bonds at the request of the holders thereof. 
25 
SEC. 5. Investment by Government-Owned or -Controlled Corporations. – The 
26 
provisions of their respective charters to the contrary notwithstanding, all government owned 
27 
or controlled corporations, including government financial institutions, are authorized to invest 
28 
in shares of stock of the Bank. 
29 
SEC. 6. Capital. – The authorized capital stock of the Bank shall be One Trillion pesos 
30 
(₱1,000,000,000,000.00) to be divided into Ten Billion (10,000,000,000) shares with par value 
31 


 
7 
 
of One Hundred pesos (₱100.00) per share. The Board shall determine the classification of 
1 
shares, their corresponding rights, privileges, or restrictions: Provided, That, the National 
2 
Government shall own, at all times, seventy percent (70%) of the total outstanding capital 
3 
stock of the Bank.  
4 
Two Hundred Billion pesos (₱200,000,000,000.00) or twenty percent (20%) of the 
5 
authorized capital stock of the Bank shall be subscribed and One Hundred Sixty-Three Billion 
6 
Seven Hundred Eighty-Seven Million Seven Hundred Eleven Million Three Hundred Eight pesos 
7 
(₱163,787,711,308.00) or at least eighty one and 89/100 percent (81.89%) of the total 
8 
subscription shall be paid up by the National Government.  
9 
When dividends are declared for stockholders, the dividend due to the National 
10 
Government shall at all times be in proportion to its ownership of the Bank. The Board, upon 
11 
the recommendation of the Secretary of Finance and with the approval of the President of the 
12 
Philippines, may increase the capitalization of the Bank up to such an amount as may be 
13 
necessary to attain the objectives of this Charter, and may allocate part or all of the Bank's 
14 
unrestricted retained earnings towards paying for the increase in capital. 
15 
SEC. 7. Preferred Shares. – All preferred shares of stock issued under this Charter shall 
16 
be entitled to the income earned by the Bank on its investment and other operations: Provided, 
17 
That the holders of such preferred shares of stock shall not bring derivative suits against the 
18 
Bank. 
19 
SEC. 8. Voting of Shares. – The voting power of all the common shares of stock of the 
20 
Bank owned and controlled by the government shall be vested in the President of the 
21 
Philippines or in any ex officio member of the Board of Directors of the Bank or their respective 
22 
alternates, as may be designated by the ex officio member. 
23 
SEC. 9. The Board of Directors and Membership. – The powers and functions of the 
24 
Bank shall be vested in and exercised by a Board of Directors which shall be composed of nine 
25 
(9) members as follows: 
26 
(a) Secretary of Finance who shall be the ex-officio Chairperson of the Board, without 
27 
compensation; 
28 
(b) President of the Bank as Vice Chairperson, who shall be appointed by the President 
29 
of the Philippines from a shortlist prepared by the Governance Commission on 
30 


 
8 
 
GOCCs (GCG) pursuant to RA No. 10149, otherwise known as the “GOCC 
1 
Governance Act of 2011”;  
2 
(c) Secretary of Agriculture as an ex-officio member; 
3 
(d) Secretary of Agrarian Reform as an ex-officio member; 
4 
(e) Secretary of Labor and Employment as an ex-officio member,  
5 
(f) Secretary of the National Economic and Development Authority as an ex-officio 
6 
members; and 
7 
(g) Three (3) independent directors to be appointed by the President of the Philippines 
8 
with the appointment process under RA No. 10149, wherein one (1) shall represent 
9 
the agricultural sector and two (2) shall represent the private sector, preferably 
10 
with expertise in finance, economics, and banking.  
11 
The ex-officio directors may each designate an alternate, who shall be an official with 
12 
a rank not lower than Assistant Secretary. 
13 
The annual stockholders' meeting shall be held at any date in May, as may be 
14 
determined by the Board of Directors, unless it falls on a legal holiday, in which case, the 
15 
meeting shall be held on the next succeeding business day. 
16 
The appointive members of the Board shall hold a term of office for one (1) year and 
17 
shall continue to hold office until their successor shall have been qualified and appointed. The 
18 
Board shall convene as often as necessary to discharge its responsibilities properly, but shall 
19 
meet at least once every month. The Board may be convoked either by the Chairperson or in 
20 
one's absence, the Vice Chairperson. 
21 
The majority of the board members shall constitute a quorum. All decisions of the 
22 
Board shall require the concurrence of at least the majority of its members. 
23 
No person shall be elected or appointed director of the Bank unless such person is a 
24 
Filipino citizen, of good moral character, and has attained proficiency, expertise and 
25 
recognized competence in one or more of the following:  banking, finance, economics, law, 
26 
agriculture, agrarian reform, business management, governance, sustainability, digital 
27 
transformation, rural economy, banking, co-operation, small-scale industry, information 
28 
technology, and information security.  
29 
The compensation, per diems, allowances, incentives, and other benefits for Board 
30 
Members shall be subject to the provisions of RA No. 10149.  
31 


 
9 
 
SEC. 10. Powers and Responsibilities of the Board. – The Board of Directors shall have 
1 
the following specific powers and responsibilities:  
2 
(a) Formulate policies, rules and regulations for the effective operation of the Bank 
3 
and issue such rules and regulations as it may deem necessary to effectively 
4 
implement the provisions of this Charter;  
5 
(b) Decide on matters concerning loans, as well as fix the rates of interest thereon, 
6 
guarantees, investments, borrowings by the Bank, furnishing of technical 
7 
assistance and other operations of the Bank; 
8 
(c) Establish such branches and agencies as may be deemed necessary and 
9 
convenient;  
10 
(d) Appoint and remove such personnel as may be necessary for the expeditious 
11 
conduct of the business of the Bank; 
12 
(e) To create and establish a “Provident Fund” which shall consist of contributions, 
13 
made both by the Bank and its officers or employees, to a common fund for the 
14 
payment of benefits to such officers or employees, or their heirs, under such terms 
15 
and conditions consistent with RA No. 10149 and Executive Order (EO) No. 150, s. 
16 
2021 otherwise known as the Compensation and Position Classification System 
17 
(CPCS) and Index of Occupational Services, Position Titles, and Job Grades for 
18 
GOCCs (IOS-G) Framework; 
19 
(f) Notwithstanding any law to the contrary, adopt an organizational structure, staffing 
20 
pattern and personnel qualification standards of the Bank and to reorganize, 
21 
rationalize and restructure the same, or realign the various functions in the Bank 
22 
to ensure effective accomplishment of its mandates and strategic goals, the 
23 
alignment of its organizational structure and staffing pattern with industry 
24 
standards, and its responsiveness to regulatory requirements, subject to the 
25 
provisions of RA No. 10149.  
26 
(g) Design, adopt and revise, as it may deem necessary, an early separation plan for 
27 
employees of the Bank to ensure the availability of a human resource pool qualified 
28 
and capable of implementing the Bank's authorities under this Charter in a manner 
29 
responsive and attuned to market developments, and to provide incentives for 
30 
those who shall be separated from the service, subject to the provisions of RA No. 
31 
10149; 
32 
(h) Approve the budget of the Bank for its operations;  
33 


 
10 
 
(i) Enter into compromise or release in whole or in part, any claim or liability 
1 
whatsoever for or against the Bank, including interest, penalties, fees and other 
2 
charges, under such terms and conditions as the Board may find acceptable and 
3 
practicable in accordance with standard banking practices, subject to its best 
4 
business judgment, and the best interest of the corporation; and 
5 
(j) Perform other functions, duties and responsibilities necessary, related and 
6 
incidental to the above mentioned powers and functions. 
7 
The Board shall exercise its powers in a manner consistent with the principles of 
8 
transparency, fairness and accountability: Provided, That, the Board may delegate its powers 
9 
to the President as may be deemed necessary. 
10 
SEC. 11. Environmental, Social, and Governance Principles. – As an integral part of the 
11 
National Government, the Bank is inherently mandated to be socially responsible, to act and 
12 
operate as good corporate citizens. The Governing Board of the Bank shall recognize and 
13 
perform obligations that the Bank has towards the National Government, its majority 
14 
stockholder, as well as the minority stockholders when existing, together with the employees, 
15 
suppliers, customers and other stakeholders, and the communities in which it operates. 
16 
SEC. 12. Foreclosure of Collaterals and Disposal of Bank Acquired Properties. – The 
17 
foreclosure of collaterals and disposal of bank acquired properties shall be governed by the 
18 
following: 
19 
(a) Foreclosure of Mortgage Collaterals - Foreclosure of mortgage collaterals to loan 
20 
may be made either judicially or extrajudicially;  
21 
(b) Deputization of Legal Staff - The Bank may, with the approval of the court, deputize 
22 
any member of its legal staff to act as special sheriff in foreclosure cases, in the 
23 
sale or attachment of debtor's properties and in the enforcement of court writs and 
24 
processes in cases involving the Bank. The special sheriff of the Bank shall make a 
25 
report to the proper court after any action has been taken by such special sheriff, 
26 
which court shall treat such actions as if it were an act of its own sheriffs in all 
27 
respect; 
28 
(c) Disposal of Real Estate and Other Properties in the Collection of Debt - Real estate 
29 
and other properties acquired by the Bank in the collection of debts or investment 
30 
by way of foreclosure or other means shall be sold or disposed of in accordance 
31 
with law, within five (5) years after their respective dates of acquisition.  
32 


 
11 
 
For this purpose, the Board of Directors shall be the appropriate regulatory 
1 
authority and promulgate the necessary implementing rules and regulations; 
2 
(d) Exemption from Attachment - The provisions of any law to the contrary 
3 
notwithstanding, securities on loans and other credit accommodations granted by 
4 
the Bank shall not be subject to attachment or execution or any other court 
5 
process, nor shall they be included in the property of insolvent persons or 
6 
institutions, unless all debts and obligations of the debtors to the Bank have been 
7 
paid, including accrued interest, penalties, collection expenses, and other charges; 
8 
and 
9 
(e) Right of Redemption of Foreclosed Property, Right of Possession During 
10 
Redemption Period - Within the redemption period provided for in Section 47 of 
11 
the General Banking Law of 2000, the mortgagor shall have the right to redeem 
12 
the property by paying all claims of the Bank against such mortgagor on the date 
13 
of the sale including all the cost and other expenses incurred by reason of the 
14 
foreclosure sale and custody of the property, as well as charges and accrued 
15 
interest. The Bank may take possession of the foreclosed property during the 
16 
redemption period. When the Bank takes possession during such period, it shall be 
17 
entitled to the fruits of the property with no obligation to account for them, the 
18 
same being considered compensation for the interest that would otherwise accrue 
19 
on the account. Neither shall the Bank be obliged to post a bond for the purpose 
20 
of such possession. Perform other functions, duties and responsibilities necessary, 
21 
related and incidental to the above mentioned powers and functions 
22 
SEC. 13. Compensation of Executive Officers. – The President of the Bank shall be its 
23 
Chief Executive Officer whose salary shall be subject to the provisions of RA No. 10149.  
24 
The President shall be assisted by Vice Presidents and other officials whose 
25 
appointment and removal for cause shall be approved by the Board of Directors upon 
26 
recommendation of the President of the Bank. The salary of the Vice President and other 
27 
officials shall also be subject to the provisions of RA No. 10149. During the absence or 
28 
temporary incapacity of the President, or in case of vacancy or permanent Incapacity and 
29 
pending appointment of a new President of the Bank, the Board of Directors shall designate 
30 
the officer-in-charge of the Bank. 
 
31 


 
12 
 
SEC. 14. Duties and Powers of the Bank President. – The President of the Bank shall 
1 
execute the policies, measures, orders and resolutions promulgated by the Board of Directors 
2 
and supervise and administer the operations of the Bank. The President shall be the legal 
3 
representative of the Bank and shall make all contracts and enter into all necessary obligations 
4 
on behalf of the Bank as required or permitted by this Charter. The President shall report 
5 
periodically to the Board of Directors the main facts concerning the operations of the Bank, 
6 
and recommended changes of policies which may seem best. The President shall furnish, upon 
7 
the request of the President of the Philippines, any information regarding the operations of 
8 
the Bank. 
9 
SEC. 15. Qualifications of Executive Officers. – No person shall be appointed to any 
10 
executive position in the Bank mentioned in the preceding section unless that person is of 
11 
good moral character and of unquestionable integrity and responsibility, and who is of 
12 
recognized competence in the field of economics, agriculture, industry, law, banking or 
13 
finance, information technology, information security, and possessed of demonstrated 
14 
administrative skill and ability. 
15 
SEC. 16. Withdrawal of Persons Having Personal Interest. – Whenever any member 
16 
attending a meeting of the Board has a personal interest in the discussion or resolution of any 
17 
given matter, or any of the relatives within the fourth degree of consanguinity or a second 
18 
degree of affinity has such interest, said member shall disclose such interest to the Board and 
19 
shall not participate in the discussion or resolution of the matter and must retire from the 
20 
meeting during the deliberations thereon. The subject matter, when resolved, and the fact 
21 
that a member had a personal interest in it, shall be disclosed to the public. The minutes of 
22 
the meeting shall reflect the disclosure made and the recusal of the member concerned. 
23 
SEC. 17. Prohibition on Persons with Personal/Pecuniary Interest. – No member of the 
24 
Board, officer, attorney, agent, or employee of the Bank shall in any manner, directly or 
25 
indirectly participate in the deliberation upon or the determination of any question affecting 
26 
one’s direct personal interest or the personal interests of relatives within the second civil 
27 
degree of consanguinity or affinity, or of any corporation, partnership, or association in which 
28 
the member, officer, attorney, agent, or employee has a direct interest. 
29 
SEC. 18. Borrowing by Directors, Officers and Employees; Restriction and Limitation. 
30 
– No (1) director or officer or employee of the Bank; or (2) any corporation, partnership, or 
31 
company wherein any member of the Bank’s Board of Directors, officer or employee, or their 
32 


 
13 
 
relatives within the first civil degree of consanguinity or affinity is a director, officer or 
1 
controlling shareholder either directly or indirectly, for one’s self or as representative or agent 
2 
of others, borrow any of the deposits of funds from the Bank, nor shall he become a guarantor, 
3 
or in any manner be an obligor for money borrowed from the Bank or loaned by it: Provided, 
4 
That this prohibition on loans to directors, officers and employees shall not include loans 
5 
allowed in the form of fringe benefits granted in accordance with rules and regulations as may 
6 
be prescribed by the Monetary Board: Provided, further, That this prohibition shall not apply 
7 
to loans to corporations wherein the director, officer or employee of the Bank sits on the board 
8 
of the borrower corporation to represent the interest of the Bank. 
9 
SEC. 19. Rules and Regulations on Conflict of Interest. – The Board of Directors is 
10 
hereby authorized to issue rules and regulations for the purposes of determining and resolving 
11 
conflict of interest questions, which rules shall, in particular, include the requirement on all 
12 
officers and employees of the Bank to disclose any shareholdings they, or their relatives within 
13 
the second civil degree of consanguinity or affinity, may have in any corporation, partnership, 
14 
or company in excess of two percent (2%) of the equity of said corporation, partnership, or 
15 
company or in any related party transactions defined by the Monetary Board of the BSP and 
16 
the Board of Directors of the Bank.  
17 
SEC. 20. Prohibition on Officers and Employees of the Bank. – Except as required by 
18 
law, or upon order of a court of competent jurisdiction, or the express order of the President 
19 
of the Philippines or written permission of the client, no officer or employee of the Bank shall 
20 
reveal nor allow to be examined, inquired or looked into, by any third person, government 
21 
official, bureau or office any information relative to details of individual accounts or specific 
22 
banking transactions, condition or business of any of its clients, or funds or properties in the 
23 
custody of the Bank belonging to private individuals: Provided, That in respect to deposits or 
24 
whatever nature, the provisions of existing law shall apply.  
25 
This prohibition shall not apply to the exchange of confidential credit information 
26 
among government financial institutions or among banks, in accordance with established 
27 
banking practices or as may be allowed by law.  
28 
SEC. 21. Exaction of Fee, Commission, Gift or Charge. – No unauthorized fee, 
29 
commission, gift, or charge of any kind shall be exacted, demanded, or paid, for obtaining 
30 
loans from the Bank, and any officer, employee, or agent of the Bank found guilty of exacting, 
31 
demanding, or receiving any fee services in obtaining any service or transaction from the 
32 


 
14 
 
Bank, shall be punished by a fine of not less than Fifty thousand pesos (P50,000) nor more 
1 
than Two million pesos (P2,000,000), imprisonment for not less than six (6) years and one 
2 
(1) month nor more than fifteen (15) years, and perpetual disqualification from public office 
3 
and confiscation or forfeiture in favor of the government of any prohibited interest and 
4 
unexplained wealth.  
5 
SEC. 22. Personnel. – The Board of Directors shall provide for an organization and staff 
6 
of officers and employees of the Bank and upon recommendation of the President of the Bank, 
7 
appoint and remove such officers and employees: Provided, That the Board shall have 
8 
exclusive and final authority to promote, transfer, assign or reassign personnel of the Bank, 
9 
any provisions of existing law to the contrary notwithstanding.  
10 
All positions in the Bank shall be governed by the provisions of RA No. 10149 . 
11 
The Bank officers and employees, including all members of the Board, shall not engage 
12 
directly or indirectly in partisan political activities or take part in any election except to vote. 
13 
No officer or employee of the Bank, subject to civil service law and regulations, shall 
14 
be removed or suspended except for cause as provided for by law and after due process of 
15 
law. 
16 
SEC. 23. Legal Counsel. – Any provision of existing law or executive order to the 
17 
contrary notwithstanding, the Bank shall have its own Legal Department which shall have the 
18 
power to represent the Bank in cases filed before courts, tribunals, and quasi-judicial bodies, 
19 
render opinions, prepare and review contracts/agreements. The Head and members of the 
20 
Legal Department shall be appointed by the Board of Directors. 
21 
In appropriate cases, the Bank may also avail of the legal services of external counsel, 
22 
subject to the approval of the Board and the Office of the Government Corporate Counsel 
23 
(OGCC): Provided, however, That the present Legal Services Group in the Bank shall serve as 
24 
its in-house legal counsel. 
25 
The hiring of any external private counsel may be authorized by the President, upon 
26 
the recommendation of the chief legal counsel and the approval of the Board and the OGCC. 
27 
SEC. 24. Penalty for Violation of the Provisions of this Charter. – Any director, officer, 
28 
employee or agent of the Bank who violates or permits the violation of any of the provisions 
29 


 
15 
 
of this Charter, or any person aiding or abetting the violation of any of the provisions of this 
1 
Charter, shall be punished by a fine of not to exceed Five hundred thousand pesos 
2 
(P500,000.00) or by Imprisonment of not more than five (5) years, or both such fine and 
3 
Imprisonment. 
4 
SEC. 25. Other Liability of Guilty Officer or Employee. – Any member of the Board of 
5 
Directors or officer or employee of the Bank who willfully violates any of the provisions of this 
6 
Act shall, in addition to the criminal and administrative liability resulting from such act, be held 
7 
liable for any loss or injury suffered by the Bank as a result of such violation.  
8 
SEC. 26. Liability of Directors, Officers or Partners of Offending Corporation or 
9 
Partnership. – If the violation of the provisions of this Act is committed by a corporation or 
10 
partnership, the directors, officers or partners hereof who participated in the violation shall be 
11 
criminally liable for such violation. 
12 
SEC. 27. Applicability of Banking Laws. – The provisions of R.A. No. 7653, otherwise 
13 
known as the New Central Bank Act, as amended by R.A. No. 11211, R.A. No. 8791, and other 
14 
applicable banking laws, insofar as they are not in conflict with any provision of this Act,  shall 
15 
apply to the Bank.  
16 
The penal provisions of Section 66 R.A. No. 8791, in relation to Sections 34, 35, 36 
17 
and 37 of R.A. No. 7653, as amended by R.A. No. 11211 shall be applicable to directors, 
18 
officers, employees and borrowers of the Bank. 
19 
SEC. 28. Control Over Subsidiaries and Dividends from Subsidiaries. – Pursuant to 
20 
Section 3(a) of this Act and notwithstanding any law, rule, regulation or practice to the 
21 
contrary, the Bank, thru its President and CEO, shall have control over its subsidiaries and 
22 
shall appoint the members of its board of directors based on the number of shares of stock 
23 
standing in the Bank’s own name in the stock books of the subsidiaries: Provided, That the 
24 
Bank may temporarily appoint directors to its subsidiaries in cases where urgent action is 
25 
needed from the subsidiaries’ board and the present number of directors does not constitute 
26 
a quorum.  Every subsidiary shall declare and remit at least fifty percent (50%) of its annual 
27 
net earnings as cash, stock or property dividends, without impairing its viability and the 
28 
purposes for which it has been established, to the Bank as the parent corporation: Provided, 
29 
That the percentage of annual net earnings that shall be declared by such subsidiary may be 
30 
adjusted by the President and CEO. 
31 


 
16 
 
SEC. 29. Transitory Provision. – Nothing in this Act shall operate to abolish the Bank 
1 
and affect the validity or legality of any right, duty, or obligation created by or in respect of 
2 
the Bank prior to the effectivity this Act. 
3 
Within one hundred eighty (180) days after the effectivity of this Act, the Bank is 
4 
hereby authorized to reorganize  and/or rationalize  the  Bank's  organizational structure to 
5 
attract fresh and critical talents to join the Bank's workforce in response to dynamic Industry 
6 
trends, incentivize early separation of tenured employees and those with medical conditions 
7 
who will be considered for retirement before the optional retirement age of sixty (60) years 
8 
old, and improve headcount management and succession planning. 
9 
All those who shall retire from the service or are separated therefrom on account of 
10 
the reorganization of the Bank under the provisions of this Charter shall be entitled to all 
11 
gratuities and benefits provided for under existing laws and/or supplementary retirement 
12 
plans adopted by and effective in the Bank. 
13 
SEC. 30. Separability Clause. – If any provision of this Act is subsequently declared 
14 
invalid or unconstitutional, the other provisions hereof which are not affected thereby shall 
15 
remain in full force and effect. 
16 
SEC. 31. Repealing Clause. – Sections 74 to 100 of RA No. 3844, otherwise known as 
17 
the Agricultural Land Reform Code, as amended, are hereby repealed. All laws, executive 
18 
orders, rules and regulations, or parts thereof inconsistent with any provision hereof are 
19 
hereby repealed or modified accordingly. 
20 
SEC. 32. Effectivity. – This Act shall take effect fifteen (15) days after its publication 
21 
in the Official Gazette or in a newspaper of general circulation. 
22 
Approved,