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RA 7635 BSP ± concerning Money, Banking and credit Government-owned corporation ± enjoy Fiscal and Administrative Autonomy 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 the 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. *Any director, officer or stockholder who, together with his 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 five percent (5%) 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 all banks in the Philippines. Any information obtained from an examination of his 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. Prohibitions. ² In addition to the prohibitions found in Republic Act Nos. 3019 and 6713, personnel of the Bangko Sentral are hereby prohibited from: (a) being an officer, director, lawyer or agent, employee, consultant or stockholder, directly or indirectly, of any institution subject to supervision or examination by the Bangko Sentral, except non-stock savings and loan associations and provident funds organized exclusively for employees of the Bangko Sentral, and except as otherwise provided in this Act; (b) directly or indirectly requesting or receiving any gift, present or pecuniary or material benefit for himself or another, from any institution subject to supervision or examination by the Bangko Sentral; (c) revealing in any manner, except under orders of the court, the Congress or any government office or agency authorized by law, or under such conditions as may be prescribed by the Monetary Board, information relating to the condition or business of any institution. This prohibition shall not be held to apply to the giving of information to the Monetary Board or

Functions: 1. Provide policy directions in the area of MBC 2. Supervision over the operations of banks 3. Regulatory powers over finance companies and non-bank financial institutions performing quasibanking functions and institutions performing similar functions Objective 1. Maintain price stability to a balanced and sustainable growth of the economy 2. Promote and maintain monetary stability and convertibility of the peso Corporate Powers 1. 2. 3. 4. 5. 6. Adopt a zeal Enter into contracts Lease/own RP/PP Sell/otherwise dispose the same Sue/be sued Others a. May own assets and incur liabilities b. Compromise, condone/release any claim/settled liability to BSP

*BSP has the power to issue subpoena for production of books and records to obtain data and information. Such data and information shall not be available to any person/entity outside of BSP whether public or private EXCEPT under order of the court SUBSIDIARY - a corporation more than fifty percent (50%) of the voting stock of which is owned by a bank or quasi-bank AFFILIATE - a corporation the voting stock of which, to the extent of fifty percent (50%) or less, is owned by a bank or 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. *No restraining order or injunction shall be issued by the court enjoining the Bangko Sentral from examining any

but not later than ninety (90) days from take over. in which cases. collect all monies and debts due said institution. That personnel of the supervising and examining departments are prohibited from borrowing from a bank under their supervision or examination. That any determination for the resumption of business of the institution shall be subject to prior approval of the Monetary Board. administer the same for the benefit of its creditors. determine that the continuance in business of the institution would involve probable loss to its depositors or creditors. any person of recognized competence in banking or finance may be designed as receiver. If the receiver determines that the institution cannot be rehabilitated or permitted to resume business in accordance with the next preceding paragraph. the Monetary Board may appoint a conservator with such powers as the Monetary Board shall deem necessary to take charge of the assets. however. Appointment of Conservator. or (d) has willfully violated a cease and desist order under Section 37 that has become final. on the basis of the report of the conservator or of its own findings. The Monetary Board shall terminate the conservatorship when it is satisfied that the institution can continue to operate on its own and the conservatorship is no longer necessary. and the management thereof. (b) has insufficient realizable assets. Proceedings in Receivership and Liquidation. the Monetary Board may summarily and without need for prior hearing forbid the institution from doing business in the Philippines and designate the Philippine Deposit Insurance Corporation as receiver of the banking institution. fully disclosed to the Monetary Board. the Monetary Board finds that a bank or quasi-bank: (a) is unable to pay its liabilities as they become due in the ordinary course of business: Provided. The receiver shall determine as soon as possible. ² Whenever. pay or commit any act that will involve the transfer or disposition of any asset of the institution: Provided. or (c) cannot continue in business without involving probable losses to its depositors or creditors.2 the Governor of the Bangko Sentral. The conservatorship shall not exceed one (1) year. as determined by the Bangko Sentral. to receive such information. 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. involving acts or transactions which amount to fraud or a dissipation of the assets of the institution. and (d) borrowing from any institution subject to supervision or examination by the Bangko Sentral shall be prohibited unless said borrowings are adequately secured. the Monetary Board shall notify in writing the board of . 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. on the basis of a report submitted by the appropriate supervising or examining department. with the exception of administrative expenditures. The conservator shall report and be responsible to the Monetary Board and shall have the power to overrule or revoke the actions of the previous management and board of directors of the bank or quasi-bank. or to any person authorized by either of them. to meet its liabilities. and exercise all powers necessary to restore its viability. liabilities. and exercise the general powers of a receiver under the Revised Rules of Court but shall not. That the receiver may deposit or place the funds of the institution in non-speculative investments. The conservator should be competent and knowledgeable in bank operations and management. ² Whenever. in writing. and shall be subject to such further rules and regulations as the Monetary Board may prescribe: Provided. For a quasi-bank. the Monetary Board finds that a bank or a quasi-bank is in a state of continuing inability or unwillingness to maintain a condition of liquidity deemed adequate to protect the interest of depositors and creditors. That this shall not include inability to pay caused by extraordinary demands induced by financial panic in the banking community. upon report of the head of the supervising or examining department. The conservatorship shall likewise be terminated should the Monetary Board. in which case the provisions of Section 30 shall apply. *The receiver shall immediately gather and take charge of all the assets and liabilities of the institution. reorganize the management.

Furthermore. The cease and desist order shall be immediately effective upon service on the respondents. in the name of the institution. *Notes and coins issued by the Bangko Sentral shall be liabilities of the Bangko Sentral and may be issued only against. institute such actions as may be necessary to collect and recover accounts and assets of. 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. The receiver shall: (1) file ex parte with the proper regional trial court. assist the enforcement of individual liabilities of the stockholders. be exempt from any order of garnishment. levy.3 directors of its findings and direct the receiver to proceed with the liquidation of the institution. The following applicable: administrative sanctions.all Philippine notes and coins issued or circulating in accordance with the provisions of this Act *The Bangko Sentral shall have the sole power and authority to issue currency. whenever (a) fines in amounts as may be determined by the Monetary Board to be appropriate. Currency . and in amounts not exceeding. and decide on other issues as may be material to implement the liquidation plan adopted. upon motion by the receiver after due notice. The actions of the Monetary Board taken under this section or under Section 29 of this Act shall be final and executory. from the moment the institution was placed under such receivership or liquidation. for the purpose of paying the debts of such institution in accordance with the rules on concurrence and preference of credit under the Civil Code of the Philippines and he may. (d) suspension of interbank clearing privileges. make arrests. The assets of an institution under receivership or liquidation shall be deemed in custodia legis in the hands of the receiver and shall. (c) suspension of lending or foreign exchange operations or authority to accept new deposits or make new investments. or defend any action against. and/or (e) revocation of quasi-banking license. Upon acquiring jurisdiction. In case of quasibanks. The petition for certiorari may only be filed by the stockholders of record representing the majority of the capital stock within ten (10) days from receipt by the board of directors of the institution of the order directing receivership. within the territory of the Philippines. The above administrative sanctions need not be applied in the order of their severity.000) a day for each violation. or execution. taking into consideration the attendant circumstances. for the purpose of maintaining the integrity of the currency. such as the nature and gravity of the violation or irregularity and the size of the bank or quasibank. adjudicate disputed claims against the institution. and may further order that immediate action be taken to correct the conditions resulting from such practice or violation. the liquidation plan shall be adopted by the Monetary Board. liquidation or conservatorship. directors and officers. . 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. Whether or not there is an administrative proceeding. (2) convert the assets of the institutions to money. (b) suspension of rediscounting privileges or access to Bangko Sentral credit facilities. and may not be restrained or set aside by the court except on petition for certiorari on the ground 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. Said notes and coins shall be a first and paramount lien on all assets of the Bangko Sentral. but in no case to exceed Thirty thousand pesos (P30. the court shall. The receiver shall pay the cost of the proceedings from the assets of the institution. 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. dispose of the same to creditors and other parties. conduct searches and seizures in accordance with law. attachment. a petition for assistance in the liquidation of the institution pursuant to a liquidation plan adopted by the Philippine Deposit Insurance Corporation for general application to all closed banks. the designation of a conservator is not a precondition to the designation of a receiver. and without requirement of prior notice or any other action. and with the assistance of counsel as he may retain. *The Bangko Sentral shall have the authority to investigate. the assets of the Bangko Sentral. the institution.

for the purpose of relending or purchasing of receivables and other obligations. These instruments may include. That a check which has been cleared and credited to the account of the creditor shall be equivalent to a delivery to the creditor of cash in an amount equal to the amount credited to his account. That. *The operations of the Securities Stabilization Fund shall consist of purchases and sales. however. their cash balances should be deposited with the Bangko Sentral. *The Bangko Sentral shall not acquire shares of any kind or accept them as collateral. its political subdivisions and instrumentalities as well as of government-owned or controlled corporations and. *The Bangko Sentral shall not engage in development banking or financing: Provided. in which the liquid funds of the Government shall be deposited. or operations with. and shall not participate in the ownership or management of any enterprise. subject to such rules and regulations as the Board may prescribe: Provided. That outstanding loans obtained or extended for development financing shall not be affected by the prohibition of this section. *Checks representing demand deposits do not have legal tender power and their acceptance in the payment of debts. participations. with only minimum working balances to be held by government-owned banks and such other banks incorporated in the Philippines as the Monetary Board may designate. The purpose of these operations shall be to increase the liquidity and stabilize the value of said securities in order thereby to promote investment in government obligations. ² Only banks duly authorized to do so may accept funds or create liabilities payable in pesos upon demand by the presentation of checks. of bonds and other evidences of indebtedness issued or fully guaranteed by the Government. as a general policy. promissory notes. certificates of assignment and similar instruments with recourse. its political subdivisions and instrumentalities *The Bangko Sentral shall represent the Government in all dealings. the Bangko Sentral shall maintain international reserves adequate to meet any foreseeable net demands on the Bangko Sentral for foreign currencies. coins shall be legal tender in amounts not exceeding Fifty pesos (P50. however. through the issuance. *The Bangko Sentral may extend loans and advances to banking institutions for a period of not more than seven (7) days without any collateral for the purpose of providing liquidity to the banking system in times of need Deposit substitutes . in the open market. That such banks may hold deposits of the political subdivisions and instrumentalities of the Government beyond their minimum working balances whenever such subdivisions or instrumentalities have outstanding loans with said banks. said Fund. both public and private. *The Bangko Sentral shall open a general cash account for the Treasurer of the Philippines. *The Bangko Sentral shall act as a banker of the Government. *All notes and coins issued by the Bangko Sentral shall be fully guaranteed by the Government of the Republic of the Philippines and shall be legal tender in the Philippines for all debts.4 *The Bangko Sentral's holdings of its own notes and coins shall not be considered as part of its currency issue and. . but need not be limited to. endorsement. and in amounts not exceeding Twenty pesos (P20.alternative form of obtaining funds from the public. and such operations shall be subject to the control of the Monetary Board in accordance with the powers granted it with respect thereto under this Act. *In order to maintain the international stability and convertibility of the Philippine peso. unless otherwise fixed by the Monetary Board. Demand deposits . is at the option of the creditor: Provided. both public and private: Provided. however. shall not form part of the assets or liabilities of the Bangko Sentral. other than deposits. and repurchase agreements.all those liabilities of the Bangko Sentral and of other banks which are denominated in Philippine currency and are subject to payment in legal tender upon demand by the presentation of checks Issue of Demand Deposits. or acceptance of debt instruments for the borrower's own account. bankers acceptances.00) for denominations of Ten centavos or less.00) for denominations of Twenty-five centavos and above. accordingly. negotiations and transactions with the International Monetary Fund and shall carry such accounts as may result from Philippine membership in. either directly or indirectly. *The Bangko Sentral shall be the official depository of the Government.

composed of: (i) Savings and mortgage banks. its political subdivisions and its instrumentalities. suspended or annulled by the Bangko Sentral in accordance with this Act or other special laws. Non-Filipino citizens may become members of the board of directors of a bank to the extent of the foreign participation in the equity of said bank. government official. *No person or entity shall engage in banking operations or quasi-banking functions without authority from the Bangko Sentral: Provided. That the deficiencies/irregularities found by or discovered by an audit shall be immediately addressed. such person or entity may commence to engage in banking operations or quasi-banking function and shall continue to do so unless such authority is sooner surrendered. 6848. endorsement or assignment with recourse or acceptance of deposit substitutes as defined in Section 95 of Republic Act No. 3. 4. irrespective of the place of incorporation. and (g) Other classifications of banks as determined by the Monetary Board of the Bangko Sentral ng Pilipinas. Upon issuance of this authority. The citizenship of the corporation which is a stockholder in a bank shall follow the citizenship of the controlling stockholders of the corporation. 73S3 (hereafter the "Rural Banks Act"). This rule shall apply to Filipinos and domestic non-bank corporations. *Foreign individuals and non-bank corporations may own or control up to forty percent (40%) of the voting stock of a domestic bank. however. (f) Islamic banks as defined in Republic Act No. except upon written permission of the depositor. or Enforcing prompt corrective action.5 RA 1405 *All deposits of whatever nature with banks or banking institutions in the Philippines including investments in bonds issued by the Government of the Philippines. and (iii) Private development banks. Regular investigation which shall not be oftener than once a year from the last date of examination to determine whether an institution is conducting its business on a safe or sound basis: Provided. as defined in Republic Act No. bureau or office. That an entity authorized by the Bangko Sentral to perform universal or commercial banking functions shall likewise have the authority to engage in quasi-banking functions. The issuance of rules of. or upon order of a competent court in cases of bribery or dereliction of duty of public officials. revoked. or in cases where the money deposited or invested is the subject matter of the litigation. 5. Inquiring into the solvency and liquidity of the institution (2-D). inquired or looked into by any person. conduct or the establishment standards of operation for uniform application to all institutions or functions covered. or in cases of impeachment. The conduct of examination to determine compliance with laws and regulations if the circumstances so warrant as determined by the Monetary Board. Overseeing to ascertain that laws and regulations are complied with. (e) Cooperative banks. 6. as defined in the Republic Act No. to which such rules. (d) Rural banks. The percentage of foreign-owned voting stocks in a bank shall be determined by the citizenship of the individual stockholders in that bank. RA 8791 Banks . 7906 (hereafter the "Thrift Banks Act"). otherwise known as the "Charter of Al Amanah Islamic Investment Bank of the Philippines". modes or standards are to be applied. (c) Thrift banks. *Quasi-banks . are hereby considered as of an absolutely confidential nature and may not be examined. (b) Commercial banks. taking into consideration the distinctive character of the operations of institutions and the substantive similarities of specific functions 2. Supervisory Powers 1. 7653 (hereafter the "New Central Bank Act") for purposes of re-lending or purchasing of receivables and other obligations.entities engaged in the borrowing of funds through the issuance.entities engaged in the lending of funds obtained in the form of deposits Banks shall be classified into: (a) Universal banks. . as defined in Republic Act No 6938 (hereafter the "Cooperative Code"). (ii) Stock savings and loan associations.

invest in the equities of allied and non-allied enterprises as may be determined by the Monetary Board. *A commercial bank may own up to one hundred percent (100%) of the equity of a thrift bank or a rural bank. *A commercial bank may. in addition to the powers authorized for a commercial bank in Section 29. Allied enterprises may either be financial or non-financial. Except as the Monetary Board may otherwise prescribe: 1. ± No director or officer of any bank shall. or of its wholly or majority-owned subsidiaries. and 2. *A bank other than a universal or commercial bank cannot accept or create demand deposits except upon prior approval of. subject to the conditions stated in the succeeding paragraph. subject to the conditions stated in the succeeding paragraphs. This rule shall also apply in the case of commercial banks. training. for himself or as the representative or agent of others. The equity investment in any one enterprise shall not exceed twenty-five percent (25%) of tile net worth of the bank. the Monetary Board may disqualify. Stockholders and Their Related Interests. and 2. *To promote competitive conditions in financial markets. pass upon and review the qualifications and disqualifications of individuals elected or appointed bank directors or officers and disqualify those found unfit. Where the equity investment of a commercial bank is in other financial allied enterprises. directly or indirectly. such investment shall remain a minority holding in that enterprise *A commercial bank may own up to one hundred percent (100%) of the equity in a non-financial allied enterprise. education. Allied enterprises may either be financial or non-financial. The total investment in equities of allied and non-allied enterprises shall not exceed fifty percent (50%) of the net worth of the bank. invest only in the equities of allied enterprises as may be determined by the Monetary Board. Except as the Monetary Board may otherwise prescribe: 1. experience. *The equity investment of a universal bank. the Monetary Board may further limit to forty percent (40%) equity investments of universal banks in quasibanks. In determining whether an individual is fit and proper to hold the position of a director or officer of a bank. and subject to such conditions and rules as may be prescribed by the Monetary Board Restriction on Bank Exposure to Directors. A publicly-listed universal or commercial bank may own up to one hundred percent (100%) of the voting stock of only one other universal or commercial bank *A universal bank may own up to one hundred percent (100%) of the equity in a non-financial allied enterprise.6 Fit and Proper Rule. and competence. whether allied or non-allied. The acquisition of such equity or equities is subject to the prior approval of the Monetary Board which shall promulgate appropriate guidelines to govern such investment. a rural bank or a financial allied enterprise. *A universal bank can own up to one hundred percent (100%) of the equity in a thrift bank. The total investment in equities of allied enterprises shall not exceed thirty-five percent (35%) of the net worth of the bark. in a single nonallied enterprise shall not exceed thirty-five percent (35%) of the total equity in that enterprise nor shall it exceed thirty-five percent (35%) of the voting stock in that enterprise. The equity investment in any one enterprise. suspend or remove any bank director or officer who commits or omits an act which render him unfit for the position. save in cases where such service is incident to financial assistance provided by the government or a government owned or controlled corporation to the bank or unless otherwise provided under existing laws. *A universal bank shall have the authority to exercise. including another commercial bank. After due notice to the board of directors of the bank. shall not exceed twenty-five percent (25%) of the net worth of the bank. no appointive or elective public official whether full-time or part-time shall at the same time serve as officer of any private bank. regard shall be given to his integrity. *Except as otherwise provided in the Rural Banks Act. borrow from such bank nor shall he become a . Officers. ± To maintain the quality of bank management and afford better protection to depositors and the public in general the Monetary Board shall prescribe. the powers of an investment house as provided in existing laws and the power to invest in nonallied enterprises as provided in this Act *A universal bank may.

3. whichever is earlier. by a bank to its directors. and 5. ± In the event of foreclosure. act as managing agent. The Monetary Board shall define the term "related interests. however. Any petition in court to enjoin or restrain the conduct of foreclosure proceedings instituted pursuant to this provision shall be given due course only upon the filing by the petitioner of a bond in an amount fixed by the court conditioned that he will pay all the damages which the bank may suffer by the enjoining or the restraint of the foreclosure proceeding. adviser. 2. officers. The required approval shall be entered upon the records of the bank and a copy of such entry shall be transmitted forthwith to the appropriate supervising and examining department of the Bangko Sentral. credit accommodations and guarantees secured by assets considered as non-risk by the Monetary Board shall be excluded from such limit: Provided. but not after. evidences of indebtedness and all types of securities. Other Banking Services. Rent out safety deposit boxes. juridical persons whose property is being sold pursuant to an extrajudicial foreclosure. directly or indirectly. shall have the right to redeem the property in accordance with this provision until. as well as investments of such bank in enterprises owned or controlled by said directors. the registration of the certificate of foreclosure sale with the applicable Register of Deeds which in no case shall be more than three (3) months after foreclosure. or officers and their related interests. documents and valuable objects. Dealings of a bank with any of its directors. That such written approval shall not be required for loans. credit accommodations and guarantees which a bank may extend to each of its stockholders. to redeem the property by paying the amount due under the mortgage deed. After due notice to the board of directors of the bank. other credit accommodations and advances granted to officers under a fringe benefit plan approved by the Bangko Sentral. Notwithstanding Act 3135. Make collections and payments for the account of others and perform such other services for their customers as are not incompatible with banking business. further. . or in any manner be an obligor or incur any contractual liability to the bank except with the written approval of the majority of all the directors of the bank. officers or stockholders and their related interests shall be upon terms not less favorable to the bank than those offered to others. the mortgagor or debtor whose real property has been sold for the full or partial payment of his obligation shall have the right within one year after the sale of the real estate. credit accommodations and guarantees extended by a cooperative bank to its cooperative shareholders. Receive in custody funds.7 guarantor. Foreclosure of Real Estate Mortgage. ± 1. credit accommodations and guarantees prescribed herein shall not apply to loans." The limit on loans. However. of any mortgage on real estate which is security for any loan or other credit accommodation granted. stockholders and their related interests. That loans. shares. consultant or administrator of investment management/advisory/consultancy accounts. the purchaser at the auction sale concerned whether in a judicial or extrajudicial foreclosure shall have the right to enter upon and take possession of such property immediately after the date of the confirmation of the auction sale and administer the same in accordance with law. *A bank shall not directly engage in insurance business as the insurer. by order of and for the account of their customers. shall be limited to an amount equivalent to their respective unencumbered deposits and book value of their paid-in capital contribution in the bank: Provided. The Monetary Board may regulate the amount of loans. the outstanding loans. credit accommodations and advances to officers in the form of fringe benefits granted in accordance with rules as may be prescribed by the Monetary Board shall not be subject to the individual limit. excluding the director concerned: Provided. the office of any bank director or officer who violates the provisions of this Section may be declared vacant and the director or officer shall be subject to the penal provisions of the New Central Bank Act. 4. endorser or surety for loans from such bank to others. whether judicially or extrajudicially. credit accommodations and guarantees that may be extended. directors. However. That loans. Upon prior approval of the Monetary Board. and all the costs and expenses incurred by the bank or institution from the sale and custody of said property less the income derived therefrom. with interest thereon at rate specified in the mortgage. officers. Prohibited Transactions. stockholders and their related interests. Act as financial agent and buy and sell. Owners of property that has been sold in a foreclosure sale prior to the effectivity of this Act shall retain their redemption rights until their expiration.

bureau. officer. 4. (d) Overvalue or aid in overvaluing any security for the purpose of influencing in any way the actions of the bank or any bank. 1405. *In case of voluntary liquidation of any bank organized under the laws of the Philippines. No examiner. branch or agency of the Government that is assigned to supervise. fee. 3. After the revocation of such license. and the Monetary Board shall have the right to intervene and take such steps as may be necessary to protect the interests of creditors. *The Monetary Board may revoke the license to transact business in the Philippines of. officer or employee of the Bangko Sentral or of any department. or causing damage to. office. or behoof of others. After the revocation of its license. officer. That numbered accounts for recording and servicing of said deposits shall be allowed. or any other entity: Provided. For purposes of this Act. No director. employee. or increasing a loan or other credit accommodation or extending the period thereof. if it finds that the foreign bank is insolvent or in imminent danger thereof or that its continuance in business will involve probable loss to those transacting business with it. examine. such a corporation shall be referred to as a trust entity RA 6426 Authority of banks to accept foreign currency deposits. corporations. the bank or any person. (c) Attempt to defraud the said bank in the event of a court action to recover a loan or other credit accommodation. the provisions of existing laws shall prevail. thereby affecting the financial interest of. (c) Accept gifts. otherwise known as the Banks Secrecy Law. or any other form of compensation in order to influence such persons into approving a loan or other credit accommodation application. (b) Furnish false or make misrepresentation or suppression of material facts for the purpose of obtaining.8 1. (b) Without order of a court of competent jurisdiction. No borrower of a bank shall (a) Fraudulently overvalue property offered as security for a loan or other credit accommodation from the bank. . That with respect to bank deposits. any foreign bank. ± The banks designated by the Central Bank under Section two hereof shall have the authority: (1) To accept deposits and to accept foreign currencies in trust Provided. renewing. *Only a stock corporation or a person duly authorized by the Monetary Board to engage in trust business shall act as a trustee or administer any trust or hold property in trust or on deposit for the use. or of any branch or office in the Philippines of a foreign bank. Consistent with the provisions of Republic Act No. assist or render technical assistance to any bank shall commit any of the acts enumerated in this Section or aid in the commission of the same. benefit. or commissions or any other form of remuneration in connection with the approval of a loan or other credit accommodation from said bank. written notice of such liquidation shall be sent to the Monetary Board before such liquidation shall be sent to the Monetary Board before such liquidation is undertaken. commission. no bank shall employ casual or non regular personnel or too lengthy probationary personnel in the conduct of its business involving bank deposits. (87-Aa) The making of false reports or misrepresentation or suppression of material facts by personnel of the Bangko Sental ng Pilipinas shall be subject to the administrative and criminal sanctions provided under the New Central Bank Act. it shall be unlawful for any such foreign banks to transact business in the Philippines unless its license is renewed or reissued. fees. employee or agent of a bank any gift. or (e) Outsource inherent banking functions. or (d) Offer any director. disclose to any unauthorized person any information relative to the funds or properties in the custody of the bank belonging to private individuals. the Bangko Sentral shall take the necessary action to protect the creditors of such foreign bank and the public. 2. or agent of any bank shall (a) Make false entries in any bank report or statement or participate in any fraudulent transaction.

and (5) To pay interest in foreign currency on such deposits. are hereby declared as and considered of an absolutely confidential nature and. bureau or office whether judicial or administrative or legislative. Provided. . 1035. government agency or any administrative body whatsoever. *Except as the Monetary Board may otherwise prescribe or allow. of which cover at least fifteen percent shall be in the form of foreign currency deposit with the Central Bank. government official. 1034. the depository banks shall maintain at all times a one hundred percent foreign currency cover for their liabilities. as amended by PD No. (4) To accept said deposits as collateral for loans subject to such rules and regulations as may be promulgated by the Central Bank from time to time. as well as foreign currency deposits authorized under PD No.9 (2) To issue certificates to evidence such deposits. That said foreign currency deposits shall be exempt from attachment. in no instance shall foreign currency deposits be examined. or any other entity whether public or private. and the balance in the form of foreign currency loans or securities. garnishment. *There shall be no restriction on the withdrawal by the depositor of his deposit or on the transferability of the same abroad except those arising from the contract between the depositor and the bank. Except as the Monetary Board may otherwise prescribe or allow. subject to the limitations to be prescribed by the Monetary Board on such loans. or any other order or process of any court. *All foreign currency deposits authorized under this Act. and if requested shall exchange the foreign currency notes and coins into foreign currency instruments drawn on its depository banks. Such foreign currency loans may include loans to domestic enterprises which are export-oriented or registered with the Board of Investments. however. except upon the written permission of the depositor. (3) To discount said certificates. which loans or securities shall be of short term maturities and readily marketable. inquired or looked into by any person. The Central Bank may pay interest on the foreign currency deposit. the foreign currency cover shall be in the same currency as that of the corresponding foreign currency deposit liability. legislative body.