Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

HOUSE BILL NO. 58

Introduced by: HON. JOSE CHRISTOPHER Y. BELMONTE

EXPLANATORY NOTE

The bill entitled, “An Act Further Strengthening Non-Stock Savings and Loan
Associations, Amending For the Purpose Republic Act No. 8367, Otherwise Known As The
"Revised Non-Stock Savings and Loan Association Act of 2013”,was previously presented
and discussed during the 14% and 15% Congresses.

At the 14” Congress, it was filed by Deputy Speaker Raul V. Del Mar and was
referred to the Committee on Banks and Financial Intermediaries, which approved the
Substitute Bill submitted by the Technical Working Group that it created. The
Substitute Bill was approved on third reading and transmitted to the Senate.
Unfortunately, the 2010 elections took place before the bill could be approved into law.

At the 15 Congress, Hon. Rachel Margeruite Del Mar filed House Bill No. 1686.
The bill was co-authored by Hon. Sergio A. Figueroa Apostol, Hon. Ma. Amelita A.
Calimbas-Villarosa and Hon. Pedro Palarca Romualdo and was referred to the
Committee on Banks and Financial Intermediaries. The bill was approved on second
reading. However, due to lack of material time because of the 2013 elections, the bill
did not become law.

When this bill was previously presented, the contribution of the non-stock
savings and loan associations to the Philippine economy and to the ideal of encouraging
Filipinos to save and judiciously use credit were well recognized. This industry has


experienced growth even in view of the framework of Republic Act No. 8367, otherwise
known as the “Revised Non-Stock Savings and Loan Association Act of 1997.”

Non-stock savings and loan associations (“NSSLAs") bring a multitude of
benefits to its members, especially those that do not have access to traditional financial
institutions. Unlike NSSLAs, traditional financial institutions simply will not extend
credit facilities to those with little or no assets, nor are they present in remote areas of
the country where there is an acute need for financial products. Neither will they
provide credit facilities in the scale typically provided by NSSLAs. In short, only
NSSLAs provide financial services to people who are otherwise considered as "high
risk" by traditional financial institutions.

‘The credit facilities provided by non-stock savings and loan associations, no
matter how small, help marginalized sectors of our society deal with situations that
perpetuate the cycle of poverty, such as stopping education due to economic reasons,
or, even simply, sparing them from the pangs of hunger.

As sensibly foreseen by previous sponsors of this bill, it is time that the
operations of these non-stock savings and loan associations be brought to the next level.
More specifically, the bill seeks to expand the non-stock savings and loan associations’
membership to a broader “well-defined group” to strengthen their stability; enable
them to accept foreign currency deposits; enhance their borrowing, lending and
investing abilities; and to task the Monetary Board of the Bangko Sentral ng Pilipinas to
set-up a regulatory framework that is best suited for non-stock savings and loan
associations.

A stronger non-stock savings and loan association can better serve its members.
Better served members means uplifting and providing better lives for more Filipinos.

For these reasons, the approval of the proposed bill is sincerely requested.

ia

JOSE CHRISTOPHER Y. BELMONTE


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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Section

HOUSE BILLNo.__088

Introduced by: HON. JOSE CHRISTOPHER Y. BELMONTE

AN ACT FURTHER STRENGTHENING NON-STOCK SAVINGS AND LOAN
ASSOCIATIONS, AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 8367,
OTHERWISE KNOWN AS THE “REVISED NON-STOCK SAVINGS AND LOAN
ASSOCIATION ACT OF 1997”

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

SECTION 1. Section 4 of Republic Act No. 8367 is hereby amended to read as
follows:

“SEC. 4.Organization of an Association. ~ At least five (5) but not
more than fifteen (15) members of a well-defined group as provided
herein may form an association under this Act. An association, prior to
transacting any business, shall secure a license from the Monetary Board
and register with the Securities and Exchange Commission (SEC). The
application for a license, signed by a majority of the incorporation and
verified by one of the trustees, shall include:

a) the proposed articles of incorporation and bylaws together

with the names and addresses of the incorporators, trustees and officers,


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‘with a statement of their character, experience and general fitness to
engage in the non-stock savings and loan business;

“B) A NOTARIZED AGREEMENT BETWEEN THE EMPLOYER
AND INCORPORATOR OF THE ASSOCIATION COVERING THE
COLLECTION MECHANISM FOR THE ASSOCIATION;

“C) [(b)Jan itemized statement of the estimated receipts and
expenditures of the proposed association for the first year;

“D) [(d)]a filing fee in such amount as may be determined by the
Monetary Board; and

“B){(d))such other information as the Monetary Board may
require.

“The SEC shall not register the articles of incorporation and
bylaws of a proposed association unless the application is accompanied
by a certificate of the Monetary Board approving the same. The Monetary
Board may deny the application to organize an association under this Act
if it finds that the association is being organized for any purpose other
than to engage in the business of a legitimate non-stock savings and loan
association or that the association’s financial program is unsound, or that
the proposed members are adequately served by one or more existing
associations.

“PRIOR TO ITS OPERATION, THE ASSOCIATION IS REQUIRED
TO SECURE A FAVORABLE ENDORSEMENT FROM THE NATIONAL,
ORGANIZATION OF NON-STOCK SAVINGS AND LOAN
ASSOCIATIONS DULY RECOGNIZED AND ACCREDITED BY THE
BANGKO SENTRAL NG PILIPINAS FOR PURPOSES OF ENSURING
COMPLIANCE, SETTING AND MAINTENANCE OF STANDARDS,
FORMULATION OF PROGRAMS NECESSARY FOR THE


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DEVELOPMENT OF STRONG AND DYNAMIC NON-STOCK
SAVINGS AND LOAN ASSOCIATIONS IN THE PHILIPPINES.

“The association shall confine its membership to a well-defined
group of persons and shall not transact business with the general public.
A ‘well-defined group’ shall be defined by the Monetary Board, and shall
consist of, but shall not be limited to, any of the following:

“1) employees, officers, and directors of [one company] PRIVATE
CORPORATIONS,including member-retirees BELONGING IN THE
SAME TRADE AND INDUSTRY;

“2)government employees belonging to the same department[/],
[branch], BUREAUJ/], office, AGENCY OR INSTRUMENTALITY OF
THE GOVERNMENT IN ACCORDANCE WITH THE REVISED
ADMINISTRATIVE CODE OF 1987, including member-retirees; and

“3) SPOUSES AND immediate members of the families [(] up to
[second] theTHIRD degree of consanguinity or affinity {)] of those falling
under paragraphs 1 and 2 above, INCLUDING THEIR LEGALLY
ADOPTED CHILDREN.

“Associations whose articles of incorporation and bylaws were
approved and registered prior to the effectivity of this Act and which
allow membership coverage broader than the foregoing definition, shall
be allowed to continue as such, [unless otherwise required by the
Monetary Board] SUBJECT TO COMPLIANCE WITH SUCH OTHER
REQUIREMENTS AS MAY BE DEEMED PROPER AND NECESSARY
BY THE MONETARY BOARD.

“{The Monetary Board may, as circumstances warrant, require

associations mentioned in the immediately preceding paragraph to


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amend their bylaws to comply with the concept of a “well-defined
group.”]

“THE ASSOCIATION MAY LEVY ENTRANCE FEES;
PROVIDED, THAT [I] In no case shall the total amount of entrance fees
exceed [one] TWO percent {(1%)] (2%) of the MINIMUM amount OF
CAPITAL CONTRIBUTION [to be contributed or otherwise paid in by
the particular member; Provided, That for new members, the said fee shall
be based on the amount of contribution computed in accordance with the
revaluation of the assets of the association].

“No person, association, partnership or corporation shall do
business, or hold itself out as doing business, as an association, or shall
use the term ‘Savings and Loan Association’ or any other title or name
tending to give the public the impression that it is engaged in the
operations and activities of an association, unless so authorized under

this Act.”

SEC. 2. Section 7 of Republic Act No. 8367 is hereby amended to read as follows:

“SEC. 7.Power of Associations. - The associations [shall] MAY:

“A) accept deposits ONLY from [and grant loans] [to] its members,
INCLUDING DOLLAR SAVINGS DEPOSITS: PROVIDED, THAT IN THE
CASE OF DOLLAR DEPOSITS, THE SAME SHALL BE SUBJECT TO THE
PRIOR APPROVAL OF THE BANGKO SENTRAL NG PILIPINAS,
subject to such rules and regulations as the Monetary Board may
promulgate to ensure sound, stable and efficient operation; Provided,
FURTHER, That no deposits shall be sourced or deducted from the loans

granted to a member without his or her written consent[.];


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“B) EXTEND LOANS TO ITS MEMBERS. IN CASE OF AN
UNCOLLATERALIZED LOAN, THE MAXIMUM LOAN AMOUNT OF
A MEMBER WILL BE BASED ON HIS OR HER PAYING
CAPACITY;PROVIDED, THAT HIS OR HER NET TAKEHOME PAY
SHALL BE NO LOWER THAN WHAT IS PROVIDED FOR IN THE
GENERAL APPROPRIATIONS ACT FOR GOVERNMENT EMPLOYEES
OR THAT SET BY COMPANY INTERNAL POLICIES, IN CASE OF
PRIVATE EMPLOYEES. IN CASE OF COLLATERALIZED LOANS,
[T]the loan{s] AMOUNT shall not exceed the members’ deposits and
contributions in the association, plus twelve (12) months of his OR HER
regular salary as the association may allow AND/OR seventy percent
(70%) of the [fair market] APPRAISED value of any property acceptable as
collateral on first mortgage that [he] THE MEMBER may offer as
security;PROVIDED, FURTHER, THAT THE CONDITION ON NET
TAKEHOME PAY UNDER AN UNCOLLATERALIZED LOAN IS
COMPLIED WITH. THE ASSOCIATION SHALL PRESCRIBE THE
INTEREST RATE, FEES, CHARGES, REPAYMENT PERIOD AND
OTHER TERMS AND CONDITIONS OF THE LOAN BASED ON
SOUND RISK MANAGEMENT. [Provided, That no loan shall have the
maturity date of more than five (5) years, except loans on the security of
unencumbered real estate for the purpose of home building and home
development, which may be granted with maturities not exceeding
twenty-five (25) years, and medium and long-term loans to finance
agricultural projects, subject to regulations prescribed by the Monetary
Board]: Provided,{further] FINALLY, That [the treasurer, cashier, or
paymaster of the office] NOTWITHSTANDING THE PROVISION OF


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ANY EXISTING LAW, RULE AND REGULATION TO THE CONTRARY,
THE COMPANY, DEPARTMENT, BUREAU, OFFICE OR AGENCY
employing a member is AUTHORIZED [required, notwithstanding the
provision of any existing law, rule and regulation to the contrary,] to
[make]DEDUCT [deducions] from A MEMBER'S [his] salary, wage,
income, OTHER COMPENSATION, [or] retirement pension, OTHER
RETIREMENT AND SEPARATION BENEFITS, AND OTHER
RECEIVABLES pursuant to the terms of his/HER loan AGREEMENT, and
all SUCH other deductions authorized by HIM/HER|the member], AND
to remit such deductions to the association; [concerned, and to collect such
reasonable fee for his services as may be authorized by rules promulgated
by the Monetary Board.]

[In addition to the powers granted it by this Act and existing laws,
any association may:]

[a) charge reasonable interest and collect such necessary fees and
charges incidental to the grant of loans;]

“C)[b)] invest its funds in any TRADABLE INVESTMENT-GRADE_
[sound non-speculative enterprises as well as in] bonds, security, and
other obligations issued by the government of the Philippines, or any of
its political subdivisions, instrumentalities, or corporations [including
government-owned or  -controlled corporations] AND OTHER
INVESTMENT OUTLETS subject to [the rules and regulations of the
Monetary Board] PRIOR APPROVAL OF THE BANGKO NG PILIPINAS
SENTRAL;

“D)[o)] allow members to participate in the profits of the
association ON THE BASIS OF THEIR RESPECTIVE CAPITAL
CONTRIBUTIONS AND STATUS OF THEIR LOANS ON THE


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DISTRIBUTION DATE OF NET INCOME, AS APPROVED BY ITS
BOARD OF TRUSTEES/DIRECTORS;

“B)[d)] borrow money or incur such obligations not exceeding
twenty percent (20%) of the total assets of the associationfs], from any
lending institutions. The Monetary Board, may, in meritorious cases, raise
the ceiling on the borrowing capacity of an association to an amount not
exceeding thirty percent (30%) of its total assets;Provided, That any such
association organized by employees of an entity or corporation may
borrow funds from said entity or corporations but not vice-versa;Provided,
further, That the number of the association's creditors shall not exceed
nineteen (19) at any GIVEN[one] time;

“F)Je)|maintain deposits with banks;Provided, That the amount of
such deposits shall be subject to the loan limit to a single borrower as
prescribed herein or by other special laws or regulations;

“G)[l[require the employer-entity or corporation to provide it
with adequate office space within which it can conduct its business]
LEND OR INVEST IN ANOTHER ASSOCIATION WITH THE MAIN
OBJECTIVE OF EXTENDING FINANCIAL ASSISTANCE TO AN
ASSOCIATION EXPERIENCING LIQUIDITY PROBLEM; [and]

“H)[g)] engage in death benefit program meant exclusively for the
mutual benefit of its members[.];

“1) REDISCOUNT PAPERS WITH THE BANGKO SENTRAL NG
PILIPINAS OR OTHER BANKS AND THEIR BRANCHES AND
AGENCIES. THE BANGKO SENTRAL NG PILIPINAS SHALL SPECIFY
THE NATURE OF THE PAPER DEEMED ACCEPTABLE FOR THE


1 REDISCOUNT RATE TO BE CHARGED BY ANY OF THESE
2 INSTITUTIONS; AND

3 “J) PERFORM SUCH ACTS AND FUNCTIONS AS MAY BE
4 AUTHORIZED AND/OR DELEGATED BY THE BANGKO SENTRAL NG
Ss PILIPINAS.”

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7 SEC. 3. Section 9 of Republic Act No. 8367 is hereby amended to read as follows:
8

9 “SEC. 9.Service Units. — An association [shall] IS HEREBY
10 AUTHORIZED TO open, maintain and operate service units as may be
a necessary, in order to EFFICIENTLY AND EFFECTIVELY deliver services
2 to its members subject to RULES AND REGULATIONS PRESCRIBED BY
13 [approval of] the Monetary Board{.|;PROVIDED, HOWEVER, THAT
14 SERVICE UNITS CANNOT ACCEPT/RECEIVE DEPOSITS OR
15 CONTRIBUTIONS.”

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wv SEC. 4. A new section, Section 9-A, is hereby added to Republic Act No.

18 8367 to read as follows:

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20 “SEC. 9-A. PROVISION OF OFFICE SPACE. ~ THE EMPLOYER-
2 ENTITY OR CORPORATION SHALL PROVIDE ITS NON-STOCK
22 SAVINGS AND LOAN ASSOCIATION WITH ADEQUATE OFFICE
23 SPACE IN ITS PREMISES TO CONDUCT ITS BUSINESS.”

24

25 SEC. 5.Section 10 of Republic Act. No. 8367 is hereby amended to read as

26 follows:


1 “SEC. 10. Agents and Salesmen. — No person OR ENTITY shall act
2 as a[n] SALES agent or [sales] representative of an associate [or operate an
3 agency] without [obtaining a license from] REGISTERING WITH the
4 [Monetary Board] BANGKO SENTRAL NG PILIPINAS. No license OR
i REGISTRATION is required for a collector of an association [but no
6 person shall hold himself out or act as collector unless he is authorized as
7 a collector in writing by such association].”

8

9 SEC. 6. Section 11 of Republic Act No. 8367 is hereby amended to read as follows:
10

1 “SEC. 11. Merger or Consolidation of Associations. — To
2 achievesimplicity, economy and__ efficiency, MERGER OR
13 CONSOLIDATION OF SEVERAL OR different associations of one
4 company or department or office [may merge or consolidate] SHALL BE
15 ALLOWED [upon] SUBJECT TO THE approval of the Monetary Board.”
16

7 SEC. 7.Section 12 of Republic Act No. 8367 is hereby amended to read as
18 follows:

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20 “SEC. 12. Trustees AND OFFICERS.— Only members are eligible as
21 trustees of an association. Provided, That in the case of a merger or
22 consolidation of associations duly approved by the Monetary Board, the
23 limitation on the maximum number of trustees in a corporation, as
24 provided for in the Corporate Code, shall not be applied for a maximum
25 period of three (3) years so that membership in the new board may
26 include up to the total number of trustees provided for in the respective

27 articles of incorporation of the merging or consolidating associations.


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“AFTER DUE NOTICE TO THE BOARD OF TRUSTEES OF THE.
ASSOCATION, THE MONETARY BOARD MAY DISQUALIFY,
SUSPEND OR REMOVE ANY TRSUTEEE OR OFFICER WHO COMITS.
OR OMITS AN ACT WHICH RENDERS HIM OR HER UNFIT FOR THE
POSITION.

“IN DETERMINING WHETHER AN INDIVIDUAL IS FIT AND
PROPER TO HOLD THE POSITION OF A TRUSTEE OR OFFICER OF
AN ASSOCIATION, REGARD SHALL BE GIVEN TO HIS OR HER
INTEGRITY, EXPERIENCE, EDUCATION, TRAINING AND
COMPETENCE.”

SEC.

“SEC. 14.Compensation of Trustees, Officers and Employees. No
trustee, officer, or employee of an association shall receive from such
association, and no association shall pay to any trustee, officer, or
employee of such association, any commission, emolument, gratuity or
reward based on the volume or number of loans made, or based on the
interest or fees collected thereon. Nothing in this section SHALL BE
CONSTRUED TO prohibit[s] or OTHERWISE [limits] RESTRICT any of
the following:

“a) receipt of or payment of salaries of trustees, officers and
employees;

“B) RECEIPT OR PROVISION OF FRINGE BENEFITS TO
OFFICERS AND EMPLOYEES;

ction 14 of Republic Act No. 8367 is hereby amended to read as follows:


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“C)[b)|receipt of payment of commissions to agents whether or not
based on the volume or number of loans or on the interest or fees
collected thereon; [and] OR

“D)[c)] receipt or payment of bonuses to trustees, officers or
employees, if such bonuses are based on the performance and not on the
volume or number of loans made or on the interest or fees collected
thereon.

{All increase in the compensation, in any form, of all trustees and
trustee-officers in excess of ten percent (10%) thereof per annum shall
require the approval of the BangkoSentral.]

“IN ORDER TO PROTECT THE FUNDS OF MEMBERS AND
CREDITORS, THE TERMS AND CONDITIONS OF THE
COMPENSATION OF TRUSTEES, OFFICERS AND EMPLOYEES MAY
BE SUBJECT TO RULES AND REGULATIONS OF THE BANGKO
SENTRAL NG PILIPINAS.

SEC. 9. Section 16 of Republic Act No. 8367 is hereby amended to read as follows:

“SEC. 16.Execution of Loan Agreement. For each loan made by an

association, [a written note or other obligation expressing a rate of
interest must be executed by the borrower] PAYMENT OF A SPECIFIC
RATE OF INTEREST BY THE BORROWER SHALL EXPRESSLY BE
STIPULATED IN THE LOAN AGREEMENT OR ANY DOCUMENT
DEEMED AN INTEGRAL PART THEREOF.”

SEC. 10Section 18 of Republic Act No. 8367 is hereby amended to read

as follows:


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2 “SEC. 18.Limitation on Investment. — a) No association at any one
3 time shall invest in bonds and securities in a total amount in excess of [ten
4 percent (10%)] TWENTY-FIVE PERCENT (25%) of the total assets of such
5 association without THE prior written approval of the BangkoSentral NG
G PILIPINAS[];
7 “p) No association at any one time shall invest in real property in a
8 total amount in excess of five percent (5%) of the total assets of such
9 association|.];
10 “c) No association at any one time shall invest in furniture, fixture,
1 furnishings and equipment and leasehold improvements for its offices, in
2 an amount more than ten percent (10%) of its total capital
3 contribution|.];”
14
nh) SEC. 11 Section 19 of Republic Act No. 8367 is hereby amended to read as

16 follows:

v7 “SEC. 19.Reserves. — Every association shall create a withdrawable
18 share reserve which shall consist of [two percent (2%)] ONE PERCENT
19 (1%) of total capital contributions of the members [which the Monetary
20 Board may increase to a maximum of three percent (3%), as the situation
2 warrants]. THE BANGKO SENTRAL NG PILIPINAS SHALL, IN
2 MERITORIOUS CASES AND WHEN THE INTERESTS OF THE
23 ASSOCIATION AND ITS MEMBERS SO DICTATE, ALLOW THE
24 STRAGGERED BOOKING OF ITS RESERVE REQUIREMENT TO
25 INCLUDE ITS WITHDRAWABLE SHARE RESERVE, SURPLUS
26 RESERVE FOR LEDGER DISCREPANCIES AS WELL AS ITS RESERVES

27 FOR OFFICE PREMISES, FURNITURE, FIXTURES AND EQUIPMENT.


2B

1 “{No association shall distribute to its members any portion of its
2 net income of its withdrawable share reserve it less than the minimum
3 requirement, or if by such payment or distribution, such reserve will be
4 reduced to an amount below the minimum requirement provided herein.]
c

6 SEC. 12. Section 20 of Republic Act No. 8367 is hereby repealed.

7 SEC. 13.Section 21 of Republic Act. No. 8367 is hereby amended to read as
8 follows:

9 “SEC. 21.Annual Reports by the Association. - Every association
10 shall, within one hundred twenty (120) calendar days after the close of its
1 fiscal year furnish the Monetary Board and post in any of the association's
2 bulletin board or in any other conspicuous place a copy of its financial
13 statements AS REVIEWED BY A BANGKO SENTRAL NG PILIPINAS-
14 ACCREDITED INDEPENDENT AUDITOR, showing, in such form and
15 detail as the Monetary Board shall require, the amount and character of
16 the assets and liabilities of the association at the end of the preceding fiscal
v7 year. The Monetary Board may, in addition to the foregoing, require the
18 disclosure of such other information as it shall deem necessary for the
19 protection of the members of the association.”

20 SEC. 14.Section 22 of Republic Act. No. 8367 is hereby amended to read as
21 follows:

2 “SEC. 22.Regulatory Powers Over Associations. —
2B Notwithstanding the provisions of Section 130 of Republic Act No. 7653,
24 the power to regulate the operations of any association by the Monetary
25 Board shall continue;PROVIDED, THAT THE MONETARY BOARD
26 SHALL TAKE INTO ACCOUNT THE UNIQUE BUSINESS NATURE

27 AND INTRINSIC MANDATE AND MISSION OF ASSOCIATIONS IN


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THE ADOPTION OF A REGULATORY FRAMEWORK. SUCH
PERTINENT FEATURES OF THE REGULATORY FRAMEWORK
PRESENTLY APPLIED TO REGULAR BANKS AND QUASI-BANKS
MAY BE ADOPTED, UNTIL A REGULATORY FRAMEWORK FOR
ASSOCIATIONS IS ADOPTED. SUCH POWER SHALL [and] consist of
the following:

a) [in seeing] ENSURE [to it] that the capital, financing, direction
and administration, as well as the integrity, responsibility, and ability of
organizers, administrators, trustees, and officers of all associations
organized and OPERATING[operated] under this Act{,shall] reasonably
ASSURES|assure] the safety of the interests which its members
ENTRUSTEDJentrust] to them;

“p) {in regulating] REGULATE the operation and activities of
associations, which include, among others: 1) in placing limits to the
maximum credit allowed TO any individual borrower; 2) in determining
the loan repayment period and loan procedures; 3) in imposing a
uniform accounting system IN COMPLIANCE WITH PHILIPPINE
FINANCIAL REPORTING STANDARDS and manner of keeping the
accounts and records of associations; 4) in instituting periodic surveys of
loan and lending procedures, audits, test CHECKS [check] of each and
ANY other transactions of associations[,]; and 5) whenever necessary, in
conducting training courses for personnel of associations.

“c) [in requiring all accountable officers and employees of every
association to post bonds for the faithful performance of their duties in

reasonable sums and with such sureties as the Monetary Board may

require] PRESCRIBE ADDITIONAL LIQUIDITY REQUIREMED


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“d) [in fixing, by rules or by orders, in specific cases, after notice
and hearing, the limits of loanable funds, amounts for investment and
reserves for withdrawals and other contingencies] ENFORCE PROMPT
CORRECTIVE ACTION ON ASSOCIATIONS CLEARLY SHOWING
CONDITIONS INDICATING HIGHER THAN NORMAL RISK OF
FAILURE;

“e) {in issuing rules and regulations for the proper implementation
of this Act, effective administration of the associations, and to] render
advisory assistance to all interested parties in order to carry out the
intents and purposes of this Act; [and]

“f) {in conducting] CONDUCT such investigations, tak[ing]E such
remedial measures and [existing] EXERCISE all powers under Republic
Act No. 7653, insofar as they are applicable in the enforcement of this
Act{.J;

“G) IMPOSE UPON ANY ASSOCIATION, ITS TRUST!
OFFICERS, OR EMPLOYEES, AFTER DUE NOTICE AND PROPER
HEARING, THE FOLLOWING ADMINISTRATIVE SANCTIONS,

WHENEVER APPLICABLE:

“1) FINES IN AMOUNTS AS MAY BE DETERMINED AS
APPROPRIATE BASED ON THE NATURE AND GRAVITY OF THE
OFFENSE;

“2) RESTRICTION OR SUSPENSION OF LICENSE; AND’

“3) OTHER ADMINISTRATIVE SANCTIONS AVAILABLE TO
THE BANGKO SENTRAL NG PILIPINAS UNDER ITS CHARTER.

“H) PROVIDE A CREDIT FACILITY TO SYSTEMICALLY
CRITICAL NON-STOCK SAVINGS AND LOAN ASSOCIATIONS
EXPERIENCING LIQUIDITY PROBLEMS; AND


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“1) PLACE UNDER RECEIVERSHIP, AFTER DUE NOTICE AND
HEARING, AN ERRING/DISTRESSED ASSOCIATION TO PROTECT
THE INTERESTS OF ITS MEMBERS PURSUANT TO THE EXISTING
RULES AND REGULATIONS PROMULGATED BY THE MONETARY
BOARD.

“THE RECEIVER SHALL FORTHWITH GATHER AND TAKE
CHARGE OF ALL THE ASSOCIATION'S ASSETS AND LIABILITIES
AND ADMINISTER THESE FOR THE BENEFIT OF ITS MEMBERS AS
PROVIDED FOR UNDER THE REVISED RULES OF COURT. THE
PROVISIONS OF SECTION 30 OF REPUBLIC ACT NO. 7653 ON THE
POWERS, FUNCTIONS, DUTIES AND OTHER TERMS OF REFERENCE
ON RECEIVERS SHALL APPLY.

“The Bangko Sentral NG PILIPINAS shall have the power to
enforce the laws, orders, instructions, rules and regulations promulgated
by the Monetary Board applicable to associations; to require associations,
their trustees, officers and agents to conduct and manage the affairs of
the association in a lawful and orderly manner. After due notice and
hearing, the Monetary Board may revoke or suspend the license of any
association, for such period as it determines necessary, particularly when
the solvency of an association is imperiled by losses or irregularities,
and/or when an association willfully violates any provisions of this Act
or any rule or regulations promulgated hereunder.

“The director and examiners of the department of the
BangkoSentral NG PILIPINas charged with the regulation of associations
are hereby authorized to administer oaths to any trustee, officer or
employee of any association or to any voluntary witness and to compel

the presentation of all books, documents, papers or records necessary in


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his judgment to ascertain in the facts relative to the true condition of any

association or to any loan.”

SEC. 15Section 24 of Republic Act No. 8367 is hereby amended to read as
follows:

“SEC. 24.Annual SUPERVISION Fees. — Consistent with the
provisions of Section 28 of Republic Act No. 7653, any association
organized under this Act may, pursuant to regulations promulgated for
the purpose by the Monetary Board, be required to contribute to the
Bangko Sentral NG PILIPINAS an annual SUPERVISION fee to be
determined by the Monetary Board.”

SEC. 16.Separability Clause. - If any provision of this Act is held invalid, all
other provisions of this Act not so affected thereby shall continue to be in full force and

effect.

SEC. 17.Repealing ClauseAny law or provision of law incon
provisions of this Act are hereby repealed or modified accordingly.

SEC. 18.Effectivity. - This Act shall take effect fifteen (15) days following the
completion of its publication in the Official Gazette or in two (2) national newspapers of

general circulation.

Approved.