House of Representing i
Guezon City. Metra Manila

FIFTEENTH CONGRESS
Second Regutar Session

COMMITTEE REPORT NOLAZ3 Sale
29 SEP 204

‘Submitted by the Committee on Banks and Financial Intermediaries on
ne: HoAGiino. S360
Recommending its approval, in substitution of House Bills No, 4519, 4805 and 4854,

Sponsors: Representative Sergio A. F, Aposto! and Rufus 8. Rodriguez

Mr. Speaker :

The Committee on Banks and Financial intermediaries to which wee referred:

House Bill No, 4519, introduced by Rufus B, Rodriguez and Maximo B, Rodriguez, Jr., entitied: “AN ACT
AMENDING REPUBLIC ACT 7353, OTHERWISE KNOWN AS THE RURAL BANKS ACT OF 1992, BY
ALLOWING LIMITED FOREIGN EQUITY OWNERSHIP OF RURAL BANKS IN THE PHILIPPINES”;

House Bill No. 4805, introduced by Representative Sergia A. F, Apostol, entitled: “AN ACT AMENDING
FOREIGN EQUITY IN THE CAPITAL OF FOREIGN BANKS, AMENDING FOR THE PURPOSE REPUBLIC ACT
NO. 7353, OTHERWISE KNOWN AS THE RURAL BANKS ACT OF 1992', AS AMENDED AND FOR OTHER
PURPOSES”; and

House Bill No, 4854, introduced by Pedro Romualdo, entitied: “AN ACT TO ALLOW FOREIGN EQUITY IN
THE AUTHORIZED CAPITAL STOCKS OF RURAL BANKS, AMENDING FOR THE PURPOSE REPUBLIC ACT NO,
7353 OTHERWISE KNOWN AS "THE RURAL BANKS ACT OF 1992', AS AMENDED AND FOR OTHER
PURPOSES”

has considered the same and recommends the approval of the attached bill, entitled:

“AN ACT ALLOWING FOREIGN EQUITY IN- RURAL BANKS, AMENDING FOR THE PURPOSE REPUBLIC ACT
NO. 7353 OTHERWISE KNOWN AS 'THE RURAL BANKS ACT OF 1992",

with Representatives Sergio A, F, Apostol, Rufus 8. Rodriguez, Maximo B. Rodriguez, Ir, Pedro
Romualdo, Roilo $. Golez, Julieta R. Cortuna, Isidro Q. tico, Cresente C. Paez and Philip A. Pichay as
authors thereof,

Respecttutly submitted,

SERGIO, POSTOL

Chairman

The HONORABLE SPEAKER
HOUSE OF REPRESENTATIVES
Quezon City



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House of Representatives
Gueson City. Metra Manila

Fifteenth Congress

Second Regular Session
Housésu.no. 5360

{In substitution of House Bills No. 4519, 4805 and 4854)

Reoresentatives Sergio A. F, Apostol, Rufus 8, Rodriguez, Maximo 8. Rodriguez, Jt, Pedro Ramualdo, Roito S.
Golez, Julieta R. Cortura, Isideo Q. Lico, Cresente C. Paez and Philip A. Pichay

“AN ACT
ALLOWING FOREIGN EQUITY IN. RURAL BANKS, AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 7353
OTHERWISE KNOWN AS ‘THE RURAL BANKS ACT OF 1992"

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

SECTION 1. Section 4 of Republic Act No. 7353, is hereby amended to reed as follows:

"Sec. 4, No rural bank shall be operated without 2 Certificate of Authority from the Monetary Board of
the {Ceateat_Bank] BANGKO SENTRAL NG PILIPINAS. Rural banks shall be organized in the form of stock
corporations. [Upes—consultation -with—the—eural_banks-in_the-area,—duly-ectabtished cooperatives oad
corporations peimarily-organize-te-hold-equities in-rural bonis may organite-o-rurat-bank and/o-subscribe te

‘Beard.] NON-FILIPINO CITIZENS MAY OWN, ACGUIRE, CR PURCHASE UP TO FORTY PERCENT 40%) OF THE
VOTING STOCK OF A RURAL BANK. WHERE A NEW BANK IS ESTABLISHED AS A RESULT OF A MERGER OR
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country.

The implementing rules and regulatians shall be published within ninety (90) days from the publication
of this law in two (2) newspapers of general circulation.

SEC. 5. This Act shall take effect fifteen (15) days following the completion of its publication either in
the Officiat Gazette of in any newspaper of general circulation in the Philippines.

Approved.

20110927


FACT SHEET

AMGiino. 5360

(Substitute bill to House Bills No, 4519, 4805, and 4854}
ALLOWING FOREIGN EQUITY IN RURAL BANKS,

Introduced by: REPRESENTATIVES PEDRO ROMUALDO, SERGIO A, F. APOSTOL, RUFUS RODRIGUEZ AND
MAXIMO B. RODRIGUEZ IR.

Chairperson: REPRESENTATIVE SERGIO A, f. APOSTOL

OBJECTIVES

1. To open a new source of equity infusion for rural banks so they sustain, even expand
the provision of more sophisticated forms of financial services or comply with increased
minimum capital requirements,

2. To provide for uniform foreign equity requirements in all types of banks.
KEY PROVISIONS

1. Allows foreign equity of up to 40% of voting stock in rural banks, amending for the
purpose RA No. 7353 “Rural Banks Act of 1992”. The 40% ceiling is consistent with the
provisions of R.A. No. 8791 “General Banking Law of 2000”

2. Adapts the provisions of the Ger
corporate stockholder.

ral Banking Law in determining the nationality of the