In order to control the volume of money created by the credit operations of the banking system, all banks

operating in the Philippines shall be required to maintain reserves against their deposit liabilities.

Since the requirement to maintain bank reserves is imposed primarily to control the volume of money, the
Bangko Sentral shall not pay interest on the reserves maintained with it unless the Monetary Board
decides otherwise as warranted by circumstances.

SECTION 96. Required Reserves Against Peso Deposits. The Monetary Board may fix and, when it
deems necessary, alter the minimum reserve ratios to peso deposits, as well as to deposit substitutes,
which each bank and/or quasi-bank may maintain, and such ratio shall be applied uniformly to all banks
of the same category as well as to quasi-banks.

SECTION 97. Required Reserves Against Foreign Currency Deposits. The Monetary Board is similarly
authorized to prescribe and modify the minimum reserve ratios applicable to deposits denominated in
foreign currencies.

SECTION 98. Reserves Against Unused Balances of Overdraft Lines. In order to facilitate Bangko
Sentral control over the volume of bank credit, the Monetary Board may establish minimum reserve
requirements for unused balances of overdraft lines.

The powers of the Monetary Board to prescribe and modify reserve requirements against unused
balances of overdraft lines shall be the same as its powers with respect to reserve requirements against
demand deposits.

SECTION 99. Increase in Reserve Requirements. Whenever in the opinion of the Monetary Board it
becomes necessary to increase reserve requirements against existing liabilities, the increase shall be
made in a gradual manner and shall not exceed four percentage points in any thirty-day period. Banks
and other affected financial institutions shall be notified reasonably in advance of the date on which such
increase is to become effective.

SECTION 103. Exemption from Attachment and Other Purposes. Deposits maintained by banks with
the Bangko Sentral as part of their reserve requirements shall be exempt from attachment, garnishments,
or any other order or process of any court, government agency or any other administrative body issued to
satisfy the claim of a party other than the Government, or its political subdivisions or instrumentalities.