SEVENTEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES 
)
FIRST REGULAR SESSION 
)
(fl/Iir* of 
r#,rt(
*16 SEP 15 P6«9
SENATE
SENATE BILL NO. 1 1 4 8
Rl'.Ci.iv;-]' nv;
INTRODUCED BY SENATOR JOSEPH VICTOR G. EJERCITO
AN ACT
AMENDING REPUBLIC ACT NUMBERED SEVENTY-SIX HUNDRED AND 
FIFTY-THREE ENTITLED "THE NEW CENTRAL BANK ACT" AND FOR 
OTHER PUILPOSES
EXPLANATORY NOTE
This measure seeks to strengthen the regulatory and supervisory powers of 
the Bangko Sentral ng Pilipinas thereby maintaining price stability conducive to a 
balanced and sustainable growth in our economy. Additionally, the BSP shall 
promote, oversee and maintain the stability of the financial and payment systems in 
accordance with internationally accepted principles.
Tliis bill seeks to adopt, among others, the following international best 
practices in banking supervision and other measures that will strengthen the 
regulatory and supervisory powers of the BSP over banks and other financial 
institutions:
1. The principle of coiisolidated supervision - Tliis will authorize the BSP, 
when examining a bank or other financial institution under its 
supervision, to examine its subsidiaries and affiliates engaged in allied 
activities. This is an international best practice and very important in our 
jurisdiction since the parent institution can be adversely affected by the 
failure of its subsidiaries and affiliates. Hence, the BSP should be able to 
evaluate and determine the financial condition, not only of the parent 
institution under its supervision but also of its subsidiaries and affiliates.
2. BSP's authority to approve transfers or acquisitions of shares in a 
supervised institution where such transfer or acquisition or series of 
transfers or acquisitions should be sufficient to elect at least one seat in the 
board or would effect a change in the majority ownership or control of the 
voting stock of the institution - Tliis is a proactive measure that would


empower the BSP to prevent the entry of undesirable persons into the 
supervised institution. This is very important because failure of 
institutions is usually caused by the actions of controlling stockholders.
3. The authority of the Monetary Board to prescribe guidelines for the 
examination of supervised authorities - This proposal will result in more 
effective supervision since the resources and manpower of the BSP can be 
properly allocated and the examination of problem institutions can be 
prioritized.
4. The authority of the Monetary Board to direct existing stockholders to 
infuse addirional capital or in case of their inability or refusal, to direct 
them to accept new investors or merge or consolidate with a qualified 
financial institution - Tliis is also a proactive measure that could prevent 
failures of supervised institutions.
5. Prescribing additional and transparent grounds for bank closure 
announcement of unilateral closure, suspension of payment of deposit 
substitutes, or inability to pay liabilities as they become due - These 
proposed additional grounds for closing a bank will minimize losses on 
the part of the depositors and of public funds. This will even enable the 
PDIC to recover their payments of insured deposits.
6. Increase in penalties for violation of applicable laws and regulations - This 
is necessary because it has been observed in the past that banks opted to 
commit violations and just pay the penalty because the income from 
prohibited transactions was greater than the penalty. If not corrected, 
these practices would render useless some of BSP's monetary policies.
7. Indemnify BSP personnel for cost and expenses incurred by them in 
connection with any civil, administrative or criminal action, suit or 
proceedings - Tliis will encourage BSP personnel, particularly the 
examiners, to discharge their duties and responsibilities properly without 
fear of retaliation.
In view of the foregoing, approval of tliis bill is earnestly sought.
JOSEPH VICTOR G. EJERCITO 
Senator


SEVENTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES 
)
FIRST REGULAR SESSION 
)
(«^f*r.of l(,e>..rrUr
*16 SEP 15 P6.-09
SENATE
SENATE BILL NO. 1 1 4 8  
RELi';i'.,,! r^Y:
INTRODUCED BY SENATOR JOSEPH VICTOR G. EJERCITO
AN ACT
AMENDING REPUBLIC ACT NUMBERED SEVENTY-SIX HUNDRED AND 
FIFTY-THREE ENTITLED "THE NEW CENTRAL BANK ACT" AND FOR 
OTHER PURPOSES
Be it macted by the Senate and House of Representatives of the Philippines in Congress 
assembled:
1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22 
23
SECTION 1. Section 3, Republic Act No. 7653, otherwise known as the "The 
New Central Bank Act", is hereby amended to read as follows:
"SECTION 3. Responsibility and Primary Objective. - The Bangko 
Sentral shall provide policy directions in the areas of money, banking and 
credit. It shall have supervision over the operations of banks, QUASI-BANKS, 
AND OTHER FINANCIAL INSTITUTIONS WHICH UNDER THIS ACT OR 
SPECIAL LAWS ARE SUBJECT TO BANGKO SENTRAL SUPERVISION and 
exercise such regulatory powers as provided in this Act and other pertinent 
laws over the operations of [finance companies and] OTHER non-bank 
financial institutions NOT SUPERVISED OR REGULATED BY OTHER 
GOVERNMENT AGENCIES [performing quasi-banking functions, hereafter 
referred to as quasi-banks, and institutions performing similar functions).
The primary objective of the Bangko Sentral is to maintain price 
stability conducive to a balanced and sustainable growth of the economy. It 
shall also promote and maintain monetary stability and the convertibility of 
the peso. IT SHALL LIKEWISE PROMOTE, OVERSEE AND MAINTAIN 
THE STABILITY OF THE FINANCIAL AND PAYMENTS SYSTEMS OF THE 
COUNTRY IN ACCORDANCE WITH INTERNATIONALLY ACCEPTED 
PRINCIPLES. TOWARDS THIS END, THE BANGKO SENTRAL SHALL 
ISSUE AND ENFORCE APPROPRIATE REGULATIONS.
Page 1 of 17


1 
SEC. 2. Section 11 of the same Act is hereby amended by inserting a new
2 
paragraph between the third and the fourth paragraphs which shall read as follows:
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
39
40
41
42
43
44
45
46
"MEETINGS OF THE MONETARY BOARD MAY BE CONDUCTED 
THROUGH THE USE OF MODERN TECHNOLOGY INCLUDING, BUT 
NOT LIMITED TO, TELECONFERENCING OR VIDEO-CONFERENCING.”
SEC. 3. Section 15 (Exercise of the Authority of the Monetary Board), 
paragraphs (b) and (e), of the same Act is hereby amended to read as follows:
"(b) direct the management, operations, and administration of tlie 
Bangko Sentral, reorganize its persomiel, PROVIDE SEPARATION BENEFITS 
WHENEVER NECESSARY, and issue such rules and regulations as it may 
deem necessaiy or convenient for this purpose. The legal units of the Bangko 
Sentral shall be under the exclusive supervision and control of the Monetary 
Board;
"(e) indemnify its members and other [officials] PERSONNEL of the 
Bangko Sentral [, including personnel of the departments performing 
supervision and examination functions] against all costs and expenses 
reasonably incurred by such persons in connection with any civil or criminal 
action, suit or proceedings to which he may be, or is, made a party by reason 
of the performance of his functions or duties, unless he is finally adjudged in 
such action or proceeding to be liable for BAD FAITH, MALICE, GROSS 
negligence or GROSS misconduct.
In the event of a settlement or compromise, indemnification shall be 
provided only in connection with such matters covered by the settlement as to 
wlaich the Bangko Sentral is advised by external counsel that the person to be 
indemnified [did not conunit any] HAD NOT ACTED WITH BAD FAITH, 
MALICE, GROSS negligence or GROSS misconduct.
The costs and expenses incurred in defending the aforementioned 
action, suit or proceeding may be paid by the Bangko Sentral in advance of 
the final disposition of such action, suit or proceeding upon receipt of an 
undertaking by or on behalf of the member [, officer, or employee] AND 
OTHER PERSONNEL to repay the amount advanced should it ultimately be 
determined by the Monetary Board that he is not entitled to be indemnified as 
provided in this subsection ON ACCOUNT OF BAD FAITH, MALICE, 
GROSS NEGLIGENCE OR GROSS MISCONDUCT
SEC. 4. The first paragraph of SECTION 16 of the same Act is hereby 
amended to read as follows;
"SECTION 16. Responsibility. - THE GENERAL RULE AND THE 
EXCEPTION THEREFROM ON THE LIABILITY OF PUBLIC OFFICERS AS 
PROVIDED IN SECTIONS 38 AND 39 OF CHAPTER 9, BOOK I OF TFIE
Page 2 of 17


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
39
40
41
42
43
44
45
46
REVISED ADMINISTRATIVE CODE OF 1987 SHALL APPLY TO members of 
the Monetary Board [,officials, examiners, and employees] AND OTHER 
PERSONNEL of the Bangko Sentral. [who willfully violate tliis Act or who are 
guilty of negligence, abuses or acts of malfeasance or misfeasance or fail to 
exercise extraordinary diligence in the performance of his duties shall be held 
liable for any loss or injury suffered by the Bangko Sentral or other banking 
institutions as a result of such violation, negligence, abuse, malfeasance, 
misfeasance or failure to exercise extraordinary diligence.]
SEC. 5. Tlie first paragraph of SECTION 21 of the same Act is hereby 
amended to read as follows;
"SECTION 21. Deputy Governors. - Tlie Governor of the Bangko 
Sentral, with the approval of the Monetary Board, shall appoint not more than 
[three (3)] FIVE (5) Deputy Governors who shall perform duties as may be 
assigned to them by the Governor and the Board."
SEC. 6. Tlie first paragraph of SECTION 23 of the same Act is hereby 
amended to read as follows:
"SECHON 23. Authority to Obtain Data and Information.- The Bangko 
Sentral shall have the authority to request from ANY PERSON OR ENTITY, 
INCLUDING government offices and instrumentalities, or government- 
owned or controlled corporations, any data wliich it may require for the 
proper discharge of its functions and responsibilities. The Bangko Sentral 
through the Governor or in his absence, a duly authorized representative 
shall have the power to issue a subpoena for the production of the books and 
records Cor the aforesaid purpose. Tliose who refuse the subpoena without 
justifiable cause, or who refuse to supply the bank with data requested or 
required, shall be subject to punishment for contempt in accordance with the 
provisions of the Rules of Court."
SEC. 7. Section 25 of the same Act is hereby amended to read as follows:
"SECTION 25. Supervision and Examination. - The Bangko Sentral 
shall have , supervision over, and conduct periodic or special examination of 
[banking institutions, and ] BANKS AND quasi-banks, including their 
subsidiaries and affiliates engaged in allied activities, AND OTHER 
FINANCIAL INSTITUTIONS WHICH, UNDER SPECIAL LAWS, ARE 
SUBJECT TO BANGKO SENTRAL SUPERVISION. PURSUANT TO THE 
AUTHORITY OF THE BANGKO SENTRAL UNDER THIS SECTION, AND 
IN ADDITION TO SUCH OTHER AUTHORITY GRANTED BY LAW, PRIOR 
APPROVAL BY THE BANGKO SENTRAL SHALL BE REQUIRED FOR 
TRANSFERS OR ACQUISITIONS OF SHARES OF STOCK IN BANKS OR 
QUASI-BANKS WHERE ANY SUCH TRANSFER OR ACQUISITION OR 
SERIES OF' TRANSFERS OR ACQUISITIONS WOULD BE SUFFICIENT TO 
ELECT AT LEAST ONE SEAT IN THE BOARD OF DIRECTORS OR WOULD
Page 3 of 17


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
39
40
41
42
43
44
45
46
EFFECT A CHANGE IN THE MAJORITY OWNERSHIP OR CONTROL OF 
THE VOTING STOCK IN ANY OF THESE INSTITUTIONS. PRIOR TO 
SUCH APPROVAL, NO SUCH TRANSFER OR ACQUISITION SHALL BE 
RECOGNIZED IN THE BOOKS OF THE INSTITUTION NOR BY ANY 
GOVERNMENT AGENCY AND THE TRANSFERORSTOCKHOLDERS, IN 
CASES INVOLVING TRANSFERS, SHALL REMAIN ACCOUNTABLE AND 
RESPONSIBLE THEREFOR. IN APPROVING SAID TRANSFERS OR 
ACQUISITIONS, REGARD SHALL BE GIVEN BY THE BANGKO SENTRAL 
TO THE FITNESS OF THE INCOMING STOCKHOLDERS AS MAY BE 
INDICATED BY THEIR INTEGRITY AND FINANCIAL CAPACITY.
For purposes of tliis SECTION, a subsidiary means a corporation more 
than fifty percent (50%) of the voting stock of which is owned DIRECTLY OR 
INDIRECTLY by a bank or quasi-bank and an affiliate means a corporation 
the voting stock of which, to the extent of fifty percent (50%) or less,, is owned 
by a bank, quasi-bank or which is related or linked to such institution or 
intermediary through common stockholders or such other factors as may be 
determined by the Monetary Board.
CONTROL EXISTS WHEN THE PARENT OWNS DIRECTLY OR 
INDIRECTLY MORE THAN ONE HALF OF THE VOTING STOCK OF AN 
ENTERPRISE. CONTROL MAY ALSO EXIST EVEN WHEN THE PARENT 
OWNS ONE HALF OR LESS OF THE VOTING STOCK OF AN ENTERPRISE 
WHEN THERE IS:
(A) POWER OVER MORE THAN ONE HALF OF THE VOTING 
RIGHTS BY VIRTUE OF AN AGREEMENT WITH OTHER INVESTORS; OR
(B) POWER TO GOVERN THE FINANCIAL AND OPERATING 
POLICIES OF THE 
ENTERPRISE UNDER A STATUTE OR AN 
AGREEMENT; OR
(C) POWER TO APPOINT OR REMOVE THE MAJORITY OF THE 
MEMBERS OF THE BOARD OF DIRECTORS; OR
(D) POWER TO CAST THE MAJORITY OF VOTES AT MEETINGS OF 
THE BOARD OF DIRECTORS; OR
(E) OTHER ARRANGEMENTS SIMILAR TO ANY OF THE ABOVE.
The department heads and the examiners of the supervising and/or 
examining departments are hereby authorized to administer oaths to any 
director, officer, or employee of any institution under their respective 
supervision or subject to their examination and to compel the presentation of 
all books, documents, papers or records necessary in their judgment to 
ascertain the facts relative to the true condition of any institution as well as
Page 4 of 17


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
39
40
41
42
43
44
45
46
the books and records of persons and entities relative to or in connection with 
the operations, activities or transactions of the institution under examination, 
subject to the provision of existing laws protecting or safeguarding the 
secrecy or confidentiality of bank deposits, as well as investments of private 
persons, natural or juridical, in eiebt instruments issued by the Government.
No restraining order or injunction shall be issued by the court 
enjoining the Bangko Sentral from examining any institution subject to 
supervision or examination by the Bangko Sentral, unless there is convincing 
proof that the action of the Bangko Sentral is plainly arbitrary and made in 
bad faith and the petitioner or plaintiff files with the clerk or judge of court in 
which the action is pending a bond executed in favor of the Bangko Sentral, in 
an amount to be fixed by the court. The provisions of Rule 58 of tlie New 
Rules of Court insofar as they are applicable and not inconsistent with the 
provisions of tliis SECTION shall govern the issuance and dissolution of the 
restraining order or injunction contemplated in this Section.
SEC. 8. Section 26 of the same Act is hereby amended to read as follows:
"SECTION 26. Bank Deposits and Investments. - Any director, officer or 
stockholder who, together with Iris related interest, contracts a loan or any form of 
financial accommodation from: (1) his bank; or (2) from a bank (a) which is a 
subsidiary of a bank holding company of which both his bank and the lending 
bank are 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 ONE PERCENT (1%) 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 aU 
banks in the Philippines. Any information obtained from an examination of Iris 
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 
account."
SEC. 9. Section 28 of the same Act is hereby amended to read as follows:
"SECTION 28. Examination and Fees. - The supervising and examining 
department head, personally or by deputy, slrall examine the books of every 
[banking institution] BANK AND QUASI-BANK, INCLUDING THEIR 
SUBSIDIARIES AND AFFILIATES ENGAGED IN ALLIED ACnVITIES 
AND OTHER FINANCIAL INSTITUTIONS WHICH UNDER SPECIAL 
LAWS ARE SUBJECT TO BANGKO SENTRAL SUPERVISION, IN 
ACCORDANCE WITH THE GUIDELINES SET BY THE MONETARY 
BOARD: [once in every twelve (12) months, and at such other times as the 
Monetary Board by an affirmative vote of five (5) members, may deem
Page 5 of 17


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
39
40
41
42
43
44
45
1
expedient and to make a report on the same to the Monetary Board;] 
Provided, That there shall be an interval of at least twelve (12) months 
between REGULAR [annual] examinations: PROVIDED, FURTHER, THAT 
THE MONETARY BOARD BY AN AFFIRMATIVE VOTE OF AT LEAST 
FIVE (5) MEMBERS MAY AUTHORIZE A SPECIAL EXAMINATION IF THE 
CIRCUMSTANCES SO WARRANT.
The [bank] INSTITUTION concerned shall afford to the head of the 
appropriate supervising and examining departments and to his authorized 
deputies full opportunity to examine its books, cash and available assets and 
general condition at any time during [banking] BUSINESS hours when 
requested to do so by the Bangko Sentral: Provided, however, that none of the 
reports and other papers relative to such examinations shall be open to 
inspection by the public except insofar as such publicity is incidental to the 
proceedings hereinafter authorized or is necessary for the prosecution of 
violations in connection with the business of such institutions.
[Banking] BANKS, [and quasi-banking institutions] QUASIBANKS, 
AND OTHER FINANCIAL INSTITUTIONS WHICH UNDER SPECIAL 
LAWS, [wliich] are subject to examination by the Bangko Sentral, shall pay to 
the Bangko Sentral, witliin the first tliirty (30) days of each year, an annual fee 
in an amount equal to a percentage as may be prescribed by the Monetary 
Board [of] BASED ON its average total assets during the preceding year [as 
shown on its end-of-month balance sheets, after deducting cash on hand and 
amounts due from banks, including the Bangko Sentral and banks abroad]. IN 
CONSOLIDATED EXAMINATION OF RESOURCES, THE FEES FOR THE 
EXAMINATION OF SUBSIDIARIES AND AFFILIATES ENGAGED IN 
ALLIED ACTIVITIES SHALL BE CHARGED AGAINST THEIR PARENT 
INSTITUTION UNDER EXAMINATION."
SEC. 10. Section 30 of the same Act is hereby amended to read as follows:
"SECTION 30. Proceedings in Receiversliip and Liquidation.- 
Whenever, upon report of the head of the supervising [or] AND examining 
department, the Monetary Board finds that a bank, or quasi-bank;
(a) 
HAS NOTIFIED THE BANGKO SENTRAL OR PUBLICLY 
ANNOUNCED A UNILATERAL CLOSURE, OR IN ANY MANNER HAS 
SUSPENDED THE.PAYMENT OF ITS DEPOSIT/DEPOSIT SUBSTITUTES 
LIABILITIES, OR is unable to pay its liabilities as they become due in the 
ordinary course of business; Provided, That this shall not include inability to 
pay caused by extraordinary demands induced by financial panic in the 
banking OR FINANCIAL community; OR
Page 6 of 17


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
39
40
41
42
43
44
45
46
1
(b) has insufficient realizable assets TO MEET ITS LIABILITIES, as 
determined by the Bangko Sentral IN ACCORDANCE WITH THE BANKING 
REGULATIONS [to meet its liabilities]; or
(c) cannot continue in business without involving probable losses to its 
depositors or creditors; or
(d) has willfully violated a cease and desist order under Section 37 that 
has become final, involving acts or transactions which amount to fraud or a 
dissipation of the assets of the institution; in which cases, the Monetary Board 
may summarily and without need for prior hearing forbid the institution 
from doing business in the Pliilippines and IN CASE IT IS A BANK, designate 
the Philippine Deposit Insurance Corporation as receiver of the banking 
institution.
For a quasi-bank, any person of recognized competence in banking or 
finance may be designated as receiver.
Tlie receiver shall immediately gather and take charge of all the assets 
and liabilities of the institution, administer the same for the benefit of its 
creditors, and, exercise the general powers of a receiver under the Revised 
Rules of Court but shall not, with the exception of administrative 
expenditures, pay or commit any act that will involve the transfer or 
disposition of any asset of the institution: Provided, That the receiv'er may 
deposit or place the funds of the institution in non-speculative investments. 
The receiver shall determine as soon as possible, but not later than ninety (90) 
days from take-over, whether the institution may be rehabilitated or 
otherwise placed in such a condition so that it may be permitted to resume 
business with safety to its depositors and creditors and the general public: 
Provided, That any determination for the resumption of business of the 
institution shall be subject to prior approval of the Monetary Board.
IN ORDER TO REHABILITATE THE CLOSED INS TITUITON OR TO 
RESTORE ITS OPERATIONS WITH SAFETY TO ITS DEPOSITORS, 
CREDITORS AND THE GENERAL PUBLIC OR TO MERGE OR 
CONSOLIDATE 
THE 
CLOSED 
INSTITUTION 
WITH 
ANOTHER 
QUALIFIED 
INSTITUTION, 
THE 
RECEIVER 
MAY 
IMMEDIATELY 
TRANSFER OR DISPOSE OF ANY OR ALL OF THE ASSETS OF THE 
CLOSED INSTITUHON AND PERFORM SUCH OTHER ACTS AS MAY BE 
AUTHORIZED BY LAW.
If the receiver determines that the institution cannot be rehabilitated or 
permitted to resume business in accordance with [the next preceding 
paragraph ] THIS SECTION, the Monetary Board shall notify in writing the 
board of directors of its findings and direct the receiver to proceed with the 
liquidation of the institutions. The receiver shall:
Page 7 of 17


1
2
3
4
5
6
7
8 
9
10
n
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
39
40
41
42
43
44
45
46
(1) file ex parte with the proper regional trial court, and without 
requirement of prior notice or any other action, a petition for assistance in the 
liquidation of the institution pursuant to a liquidation plan adopted by the 
Pliilippine Deposit Insurance Corporation for general application to all closed 
banks. In case of quasi-banks, the liquidation plan shall be adopted by the 
Monetary Board. Upon acquiring jurisdiction, the court shall, upon motion by 
the receiver after due notice, adjudicate disputed claims against the 
institution, assist the enforcement of individual liabilities of the stockholders, 
directors and officers, and decide on other issues as may be material to 
implement the liquidation plan adopted. The receiver shall pay the cost of the 
proceedings from the assets of the institution.
(2) convert the assets of the institution to money, dispose of the same to 
creditors and other parties, for the purpose of paying the debts of such 
institution in accordance witli the rules on concurrence and preference of 
credit under the Civil Code of the Philippines and he may, in the name of the 
institution, and with the assistance of counsel as he may retain, institute such 
actions as may be necessary to collect and recover accounts and assets of, or 
defend any action against the institution. The assets of an institution under 
receiversliip or liquidation shall be deemed in custodia legis in the hands of 
the receiver and shall, from the moment the insHtution was placed under such 
receivership or liquidation, be exempt from any order of garnishment, levy, 
attachment, or execution.
The actions of the Monetary Board taken under this section or under 
Section 29 of tliis Act shall be final and executory, and may not be restrained 
or set aside by the court except on petition for certiorari on the ground AND 
UPON A FINDING AFTER DUE HEARING that the action taken was in 
excess of jurisdiction or with such grave abuse of discretion as to amount to 
lack or excess of jurisdiction: PROVIDED, HOWEVER, THAT ANY ORDER 
RESTRAINING, 
ENJOINING 
OR 
SETTING 
ASIDE 
THE 
ACTION 
COMPLAINED OF IN THE PETITION FOR CERTIORARI, MAY ONLY BE 
ISSUED BY THE COURT OF APPEALS, BUT MAY BE DISSOLVED OR 
STAYED UPON BANGKO SENTRAL FILING A WRITTEN UNDERTAKING 
THAT IT WILL PAY ALL DAMAGES WHICH THE PETITIONER MAY 
SUFFER FROM THE DENIAL, DISSOLUTION OR STAY OF THE 
INJUNCTION SHOULD IT BE DECIDED IN A FINAL JUDGMENT THAT 
THE PETITIONER IS ENTITLED TO HAVE THE ACTS COMPLAINED OF 
PERMANENTLY ENJOINED. The petition for certiorari may only be filed by 
the stockholders of record representing the majority of the capital stock 
witlrin ten (10) days from receipt by the board of directors of the institution of 
the order directing receivership, liquidation or conservatorship. THE 
PROVISIONS OF RULE 58 OF THE 1997 RULES ON CIVIL PROCEDURE IN 
SO FAR AS THEY ARE APPLICABLE AND NOT INCONSISTENT WITH 
THE PROVISIONS OF THIS SECTION SHALL GOVERN THE ISSUANCE
Page 8 of 17


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
39
40
41
42
43
44
45
46
1
AND DISSOLUTION OF THE RESTRAINING ORDER OR INJUNCTION 
CONTEMPLATED IN THIS SECTION.
The designation of a conservator under Section 29 of this Act or the 
appointment of a receiver under this section shall be vested exclusively with 
the Monetary Board. Furthermore, the designation of a conservator is not a 
precondition to the designation of receiver."
THE AUTHORITY OF THE MONETARY BOARD TO PLACE A 
BANK OR QUASI-BANK UNDER RECEIVERSHIP AS PROVIDED 
DESIGNATED AS A RECEIVER. ABOVE MAY ALSO BE EXERCISED OVER 
NON-STOCK SAVINGS AND LOAN ASSOCIATIONS, BASED ON THE 
SAME APPLICABLE GROUNDS. FOR THIS PURPOSE, ANY PERSON OF 
RECOGNIZED COMPETENCE IN BANKING, CREDIT AND FINANCE 
MAY BE DESIGNATED AS A RECEIVER.
SEC. 11. A new section entitled Section 30-A of tlie same Act shall be inserted 
between Sections 30 and 31 wliich shall read as follows:
"SECTION 30-A. WHENEVER UPON THE REPORT OF THE HEAD 
OF THE 
SUPERVISING 
AND 
EXAMINING 
DEPARTMENT, 
THE 
MONETARY BOARD FINDS THAT THE ADJUSTED CAPITAL ACCOUNTS 
OF A BANK OR QUASI-BANK IS LOWER THAN THE MINIMUM 
CAPITAL REQUIRED UNDER EXISTING RULES AND REGULATIONS, OR 
IT HAS A CAPITAL ADEQUACY RATIO LOWER THAN THE MINIMUM 
RATIO 
PRESCRIBED 
UNDER 
EXISTING 
REGULATIONS, 
THE 
MONETARY BOARD SHALL HAVE THE AUTHORITY TO DIRECT THE 
EXISTING STOCKHOLDERS OF SAID BANK OR QUASI-BANK TO INFUSE 
CAPITAL WITHIN A PERIOD NOT EXCEEDING 90 DAYS FROM THE 
DATE OF DIRECTIVE IN SUCH AMOUNT AS MAY BE NECESSARY TO 
RESTORE THE ENTITY'S CAPITAL TO THE MINIMUM REQUIRED 
AMOUNT 
AND/OR 
RATIO. 
IN 
CASE 
OF 
INABILITY 
OR 
UNWILLINGNESS OF THE STOCKHOLDERS TO INFUSE THE REQUIRED 
AMOUNT OF ADDITIONAL CAI’ITAL WITHIN THE PRESCRIBED 
PERIOD, THE MONETARY BOARD MAY DIRECT SAID BANK OR QUASI­
BANK TO ACCEPT INVESTMENTS FROM QUALIFIED THIRD PARTIES 
OR TO MERGE OR CONSOLIDATE WITH A QUALIFIED FINANCIAL 
INSTITUTION.
THE MONETARY BOARD MAY ALSO AUTHORIZE OR ORDER 
THE EXISTING STOCKHOLDERS OF THE CONCERNED ENTITY TO 
EFFECT A QUASI-REORGANIZATION OF SAID ENTITY TO REFLECT 
THE FAIR VALUE OF HS CAPITAL.
Page 9 of 17


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
39
40
41
42
43
44
45
46
SEC. 12. Section 36 of the same Act is hereby amended to read as follows:
"SECTION 36. Proceedings Upon Violation of This Act and Other 
Banking Laws, Rules, Regulations, Orders or Instructions.- Whenever 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 tlie 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 punished by a fine of not less than Fifty 
thousand pesos (P50,000.00) nor more than [Two hundred tliousand pesos 
(P200,000.00)] TWO MILLION PESOS (P2,000,000.00 or by imprisonment of 
not less than two (2) years nor more than ten (10) years, or both, at the 
discretion of the court.
Whenever AN ENTHT UNDER BANGKO SENTRAL SUPERVISION 
[a bank or quasi-bank] persists in carrying on its business in an unlawful or 
unsafe manner, the 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 action under Section 30 of this Act."
SEC. 13. Section 37 of the same Act is hereby amended to read as follows:
"SECTION 37. Administrative Sanctions [on Banks and Quasi-Bai\ks]. - 
Wit,hont, prejudice to the criminal sanctions against the culpable persons 
provided in Sections 34, 35, and 36 of this Act, the Monetary Board may, at its 
discretion, impose upon any bank or quasi- bank, INCLUDING THEIR 
SUBSIDIARIES AND AFFILIATES ENGAGED IN ALLIED ACTIVITIES, OR 
OTHER INSTITUTIONS WHICH UNDER SPECIAL LAWS ARE SUBJECT 
TO THE BANGKO SENTFLAL SUPERVISION, their directors and/or 
officers, for any willful violation of its charter or by-laws, willful delay in the 
submission of reports or publications thereof as required by law, rules and 
regulations; any refusal to permit examination into the affairs of the 
institution; any willful making of a false or misleading statement to the Board 
or the appropriate supervising and examining department or its examiners; 
any willful failure, or refusal to comply with, or violation of, any banking law 
or any order, instruction or regulation issued by the Monetary Board, or any 
order, instruction or ruling by the Governor; or any commission of 
irregularities, and/or conducting business in an unsafe or unsound manner as 
may be determined by the Monetary Board, the following administrative 
sanctions, whenever applicable:
(a) 
Fines in amounts as may be determined by the Monetary Board to 
be appropriate, [but in no case to exceed Tlairty thousand pesos (P30,000.00) a 
day for each violation, taking into consideration the attendant circumstances.
Page 10 of 17


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
39
40
41
42
43
44
45
46
such as the nature and gravity of the violation or irregularity and the size of 
the bank or quasi-bank;] FOR EACH VIOLATION OR IRREGULARITY BUT 
IN NO CASE TO EXCEED THE FOLLOWING AMOUNTS PER BANKING 
DAY:
NATURE OF VIOLATION OR IRREGULARITY/
TYPE OF INSTITUTION 
MAXIMUM
AMOUNT 
IN PESOS
UNIVEI^AL BANKS, COMMERCIAL BANKS, THEIR
DIRECTORS AND/OR OFFICERS
-SERIOUS OR GRAVE VIOLATION/IRREGULARHY'
300.000
- LESS SERIOUS OR LESS GRAVE 
VIOLATION/ IRREGULARITY
- MINOR VIOLATION/IRREGULARITY
50.000
150,000
50,000
25,000
SUBSIDIARIES AND AFFILIATES OF UNIVERSAL 
BANKS AND COMMERCIAL BANKS, THRIFT 
BANKS, QUASI-BANKS, THEIR SUBSIDIARIES AND 
AFFILIATES, OTHER INSTITUTIONS UNDER BSP 
SUPERVISION, THEIR DIRECTORS AND/OR 
OFFICERS.
- SERIOUS OR GRAVE VIOLATION/IRREGULARITY
100,000
- LESS SERIOUS OR LESS GRAVE 
VIOLATION/IRREGULARITY
- MINOR VIOLATIONIIRREGULARIN
RURAL BANKS, NON-STOCK SAVINGS AND LOAN 
ASSOCIATIONS, PAWNSHOPS, THEIR 
SUBSIDIARIES AND AFFILIATES, DIRECTORS AND 
OFFICERS
- SERIOUS OR GRAVE VIOLATIONIIRREGULARITY
50.000
-LESS SEWOUS OR LESS GRAVE 
VIOLATION/ IRREGULARHY
- MINOR VIOLATION/IRREGULARITY
10.000
TO PROPERLY AND EFFECTIVELY IMPLEMENT THE FOREGOING 
SANCTIONS, THE MONETARY BOARD SHALL, BY REGULATION,
25,000
Page 11 of 17


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
39
40
41
42
43
44
45
DEFINE SERIOUS OR GRAVE, LESS SERIOUS OR LESS GRAVE, AND 
MINOR OFFENSES TAKING INTO CONSIDERATION THE ATTENDANT 
CIRCUMSTANCES, SUCH AS NATURE AND GIL^VITY OF THE 
VIOLATION OR IRREGULAR AND THE SIZE OF THE INSTITUTION: 
PROVIDED, THAT WILLFUL VIOLATIONS AND IRREGULARITIES MAY 
3E AUTOMATICALLY CONSIDERED BY THE MONETARY BOARD AS 
SERIOUS OR GRAVE REGARDLESS OF THEIR EFFECT TO THE 
FINANCIAL 
CONDrnON 
OF 
THE 
CONCERNED 
INSTITUTION; 
PROVIDED, 
FURTHER, 
THAT 
WITHOUT 
PREJUDICE 
TO 
THE 
IMPOSITION OF APPLICABLE SANCTION TO THE INSTITUTION THAT 
COMMITTED A SPECIFIC VIOLATION OR IRREGULARITY, THE 
MONETARY BOARD MAY ALSO IMPOSE SANCTIONS TO ITS PARENT 
UNIVERSAL OR COMMERCIAL BANK IF THERE IS EVIDENCE THAT 
SAID PARENT INSTITUTION ABETTED THE COMMISSION OF THE 
VIOLATION OR IRREGULARITY OR DID NOT EXERCISE REASONABLE 
MEANS TO PREVENT THE SAME."
(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;
(d) suspension of interbaiik clearing privileges; [andlor]
(e) revocation of quasi-banking license;
(F) REVOCATION OF TRUST LICENSE;
(G) PROHIBITION FROM DECLARING CASH DIVIDENDS;
(H) CONFISCATION BY AND FORFEITURE IN FAVOR OF THE 
BANGKO SENTRAL OF ANY AND ALL PROFITS, AS MAY BE 
DETERMINED BY THE MONETARY BOARD, ARISING FROM THE 
OFFENSE OR VIOLATION OF BANKING LAWS, RULES AND RE 
GURATIONS; AND/OR
(I) OTHER SANCTIONS AS THE MONETARY BOARD MAY DEEM 
APPROPRIATE UNDER THE CIRCUMSTANCES.
THE DIRECTOR OR OFFICER RESPONSIBLE FOR THE VIOLATION 
MAY, 
AFTER 
DUE 
PROCESS, 
BE 
SUSPENDED, 
REMOVED 
OR 
DISQUALIFIED FROM HOLDING OFFICE, OR ANY POSITION, IN AN 
INSTITUTION UNDER THE SUPERVISION OF THE BANGKO SENTRAL, 
FOR A PERIOD TO BE DETERMINED BY THE MONETARY BOARD, 
TAKING INTO CONSIDERATION THE ATTENDANT CIRCUMSTANCES,
Page 12 of 17


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
39
40
41
42
43
44
45
SUCH AS r a n  n a tu r e a n d  gravity of th e a c t o r o m issio n a n d
THE SIZE OF THE INSTITUTION.
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] TFIE 
INSTITUTION pending an investigation: Provided, That should the 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 Iiis position: Provided further, Tliat 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 continue 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 directors 
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. Tlie cease and desist 
order shall be immediately effective upon service on the respondents.
The respondents shall be afforded an opportunity 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, tlie 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 liis discretion, to impose upon 
Ranking institutions,] BANKS AND QUASI-BANKS, INCLUDING THEIR 
SUBSIDIARIES AND AFFILIATES ENGAGED IN ALLIED ACTIVITIES, 
AND OTHER FINANCIAL INSTITUTIONS WHICH UNDER SPECIAL 
LAWS ARE SUBJECT TO BANGKO SENTRAL SUPERVISION for any failure 
to comply with the requirements of law, Monetaiy Board regulations and 
policies, andlor instructions issued by the Monetaiy Board or by the 
Governor, fines not in excess of [Ten thousand pesos (P100,000.99) a] ONE 
HUNDI'lED THOUSAND PESOS (P100,000.00) PER BANKING day for
Page 13 of 17


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
39
40
41
42
43
44
45
46
eachviolation, the imposition of which shall be final and executory until 
reversed, modified or lifted by the Monetary Board on appeal."
SEC. 14. Section 77 of the same Act is hereby amended to read as follows:
"SECTION 77. Requirement of Balanced Currency Position.- The 
Monetary Board may require [the] banks AND QUASI-BANKS, INCLUDING 
THEIR SUBSIDIARIES 
AND 
AFFILIATES 
ENGAGED 
IN 
ALLIED 
ACTIVITIES, to maintain a balanced position between their assets and 
liabilities in Philippine pesos or in any other currency or currencies in which 
they operate. [The Banks] THEY shall be granted a reasonable period of time 
in which to adjust their currencypositions to any such requirement.
The powers granted under this section shall be exercised only when 
special circumstances make such action necessary, in the opinion of the 
Monetary Board, and shall be applied to all banks AND QUASI-BANKS, 
INCLUDING THEIR SUBSIDIARIES AND AFFILIATES ENGAGED IN 
ALLIED ACTIVITIES, alike and without discrimination."
SEC. 15. A new section entitled Section 88-A of the same Act shall be inserted 
between Sections 88' and 89 which shall read as follows:
"SECTION 
88-A. 
EXEMPTION 
FROM 
ATTACHMENT. 
THE 
PROVISIONS OF ANY LAW TO THE CONTRARY NOTWITHSTANDING 
AND SECTION 31 OF THIS ACT, COLLATERALS ONLOANSAND 
ADVANCES GRANTED BYTHE BANGKO SENTRAL TO BANKING 
INSTITUTIONS 
SHALL 
NOT 
BE 
SUBJECT 
TO 
ATTACHMENT, 
EXECUTION OR ANY OTHER COURT PROCESS, NOR SFIALL THEY BE 
INCLUDED 
IN THE 
PROPERTY 
OF 
INSOLVENT PERSONS OR 
INSTITUTIONS, UNLESS ALL DEBTS AND OBLIGATIONS OF TFIE 
BANKING INSTITUTIONS TO THE BANGKO SENTRAL, WHETHER 
REGISTERED OR NOT, HAVE BEEN PAID, INCLUDING ACCRUED 
INEREST, 
PENALTIES, 
COLLECTION 
EXPENSES, 
AND 
OTHER 
CFIARGES."
SEC. 16. A new section entitled Section 89-A of the same Act be inserted 
between Sections 89 wliich shall read as follows:
"SECTION 89-A. CREDIT FACILITIES FOR ISLAMIC BANKS. THE 
BANGKO SENTRAL MAY, TAKING INTO CONSIDERATION THE 
PECULIAR CHARACTERISTICS OF ISLAMIC BANKING, FORMULATE 
RULES AND REGULATIONS FOR THE EXTENSION OF REDISCOUNTING 
OR OTHER SIMILAR FACILITIES TO ISLAMIC BANKS."
Page 14 of 17


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
39
40
41
42
43
44
45
SEC. 17. Section 95 of the same Act is hereby amended to read as follows:
"SECTION 95. Definition of Deposit Substitutes. - The term "deposit 
substitutes" is defined as an alternative form of obtaining funds from the 
public, other tlian deposits, through the issuance, endorsement, or acceptance 
of debt instruments for the borrower's own account, for the purpose of re­
lending or purchasing of receivables and other obligations. Tliese instruments 
may include, but need not be Limited to, bankers, acceptances, promissory 
notes, participations, certificates of assignment and similar instruments with 
recourse, and repurchase agreements. The Monetary Board shall determine 
what specific instruments shall be considered as deposit substitutes for the 
purposes of SECTION 94 of this Act[:]. THE MONETARY BOARD MAY 
ALSO EXCLUDE FUNDS OBTAINED OR BORROWED FROM CERTAIN 
INSTITUTIONAL LENDERS FROM THIS SECTION: Provided, however. 
That deposit substitutes of commercial, industrial and other non-financial 
companies issued for the liinited 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 tliis Act."
SEC. 18. The second paragraph of Secrion 102 of the same Act is hereby 
amended to read as follows:
"The deposit reserves maintained by the banks in the Bangko Sentral in 
accordance with the provisions of Section 94 of this Act shall serve as basis for 
the clearing of checks and the settlement of interbank balances, subject to such 
rules and regulations as the Monetary Board may issue with respect to such 
operations: Provided, That any bank wliich incurs an overdrawing in its 
deposit account with Bangko Sentral shall fully cover said overdraft, 
including interest thereon at a rate equivalent to one-tenth of one percent 
(1/10 of 1%) per day or the prevailing ninety-one-day treasury bill rate plus 
three percentage points, whichever is higher, not later than the next clearing 
day: Provided, HOWEVER,[further], That settlement of clearing balances 
shall not be effected for any account which IS [continues to be] overdrawn for 
A PERIOD AS MAY BE DECIDED BY THE MONETARY BOARD 
WHENEVER WARRANTED BY THE CIRCUMSTANCES: PROVIDED, 
THAT SUCH PERIOD SHALL IN NO CASE EXCEED five (5) consecutive 
banking days until such time as the overdrawing is fully covered or otherwise 
converted into an emergency loan or advance pursuant to the provisions of 
SECTION 84 of this Act: Provided, finally. That the appropriate clearing office 
shall be officially notified of banks with overdrawn balances. Banks with 
existing overdrafts with the Bangko Sentral as of the effectivity of this Act 
shall, within such period as may be prescribed by the Monetary Board, either 
convert the overdraft into an emergency loan or advance with a plan of 
payment, or settle such overdrafts, and that, upon failure to so comply
Page 15 of 17


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
39
40
41
42
43
44
45
1
to
herewith, the Bangko Sentral shall take such action against the bank as may 
be warranted under this Act."
SEC. 19. Section 108 of the same Act is hereby amended to read as follows;
"SECTION 108. Minimum Capital Ratios. - The Monetary Board may 
prescribe minimum RISK-BASED CAPITAL ADEQUACY ratios BASED ON 
INTERNATIONALLY ACCEPTED STANDARDS [which the capital and 
surplus of the banks must bear to the volume of their assets, or to specific 
categories thereof, ] and may alter said ratios whenever it deems necessary. 
IN THE EXERCISE OF HS AUTHORITY UNDER THIS SECTION, THE 
MONETARY BOARD MAY PRESCRIBE A HIGHER MINIMUM CAPITAL 
ADEQUACY RATIO FOR INDIVIDUAL BANKS WHICH ARE EXPOSED TO 
MORE THAN NORMAL RISKS."
SEC. 20. Section 125 of the same Act is hereby amended to read as follows;
"SECTION 125. Tax Exemptions.- THE PROVISIONS OF ANY 
GENERAL OR SPECIAL LAW TO THE CONTIC\RY NOTWITHSTANDING, 
the Bangko Sentral shall be exempt [, for a period of five (5) years from tire 
approval of tliis Act] from all national, provincial, municipal and city taxes, 
fees, charges and assessments [.I NOW IN FORCE OR HEREAFTER 
ESTABLISHED. The exemptions authorized in the preceding paragraph of 
this section shall apply to all property of the Bangko Sentral, to the resources, 
receipts, expenditures, profits and income of the Bangko Sentral, as well as 
toall contracts, deeds, documents and transactions related to the conduct of 
the business of the Bangko Sentral; Provided, however. That said exemptions 
shall apply only such taxes, fees, charges, and assessments for which the 
Bangko Sentral itself would otherwise be [ , ] liable, and shall not apply to 
taxes, fees, charges, or assessments payable by persons or other entities doing 
business with the Bangko Sentral; Provided, further. That foreign loans and 
other obligations of the Bangko Sentral shall be exempt, both as to principal 
and interest, from any and all other taxes if the payment of such taxes has 
been assumed by the Bangko Sentral."
SEC. 21. The first paragraph of Section 126 of the same Act is hereby amended 
read as follows;
"SECTION 126. Exemption from Customs Duties. - The provision of 
any general or special law to the contrary notwithstanding, the importation 
and exportation by the Bangko Sentral of notes and coins, and of gold and 
other metals to be used for purposes authorized under tliis Act, and the 
importation of all equipment AND SUPPLIES needed [for] IN THE BANGKO 
SENTRAL OPERATIONS SUCH AS bank note production, ininting of coins, 
metal refining, [and other] security printing operations AND TRANSPORT 
OF CURRENCY shall be fully exempt from all customs duties and consular
Page 16 of 17


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
fees and from all other faxes, assessments and charges related to such 
importation or exportation."
SEC. 22. The first paragraph of Section 128 of the same Act ishereby amended 
to read as follows:
"SECTION 128. Prohibitions.- Tlie Bangko Sentral shall not acquire 
shares of any kind or accept them as collateral, and shall not participate in the 
ownersliip or management of [any] AN enterprise, either directly or indirectly 
[.I: PROVIDED, THAT THIS PROHIBITION SHALL NOT APPLY 
WHENEVER 
SUCH 
OWNERSHIP 
AND/OR 
MANAGEMENT 
IS 
EXPRESSLY AUTHORIZED BY LAW, OR THE MONETARY BOARD BY A 
VOTE OF AT LEAST FIVE (5) OF HS MEMBERS DEEMS AN ACQUISITION 
OR INVESTMENT TO BE NECESSARY TO THE PERFORMANCE BY 
BANGKO SENTRAL OF ITS MANDATES UNDER THIS ACT OR TO 
QUALIFY OR AS REQUIRED FOR MEMBERSHIP IN INTERNAHONAL 
AND REGIONAL ORGANIZATIONS."
SEC. 23. Repealing Clause. All provisions of existing laws, orders, rules and 
regulations, or parts thereof, in conflict or inconsistent with the provisions of this Act 
are hereby repealed.
SEC. 24. Separability Clause. If any provision or section of this Act or the 
application thereof to any person or circumstance is held to be invalid, the other 
provisions or sections of this Act, and the application of such provision or section to 
other persons or circumstances, shall not be affected thereby.
SEC. 25. Effcctivity. This Act shall take effect after fifteen (15) days following 
its publication either in the Official Gazette or in a newspaper of general circulation in 
the Philippines.
Approved,
Page 17 of 17