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Volume 1,
Series 1
MORB and MORNBFI as of End-October 2015, Amended

BSP Circular No. 903-2016

The Monetary Board released its Resolution no. 113 last January 21, 2016. It states the amended sections of: the Manual of Regulations for Banks (MORB), and Manual of Regulations for Non-Bank Financial Institutions (MORNBFI), as of end-October 2015.

Section 1: tackles the Circular no. 871, with the title of “Internal Control and Internal Audit” Appendix A dated March 5, 2015. It will be retitled as Examples of Minimum Internal Control Measures. New appendices: App. 112 (MORB) and App. Q-66 (MORNBFI), shall be added to these subsections: X185.31 for MORB and 4185Q.3 for MORNBFI.

Section 2: articulates the Circular no. 875 dated April 15, 2015. The provisions are numbered as X009/4009Q/4009T of MORB and MORNBFI.

Section 3: broaches the CL-2015-050 which is released last Aug 18. Revisions are in the 2nd paragraph of the last sentence, and 3rd paragraph of X109 from MORB. It will be titled as Consolidation Program for Rural Banks (CPRB). Lastly, Annex A from the App. 113 of MORB will be entitled as Framework on the Consolidation Program for Rural Banks.

Section 4: discourses that BSP may supervise, conduct periodic or special examination of trust corporations under Circular no. 884, or known as “Guidelines on the Establishment and Operation of Trust Corporation (TC).” It was released last July 22, 2015.

Section 5: confers these subsections 4103T.1, 4126T.1 and 4402T of the MORNBFI: a) no TC may be allowed to operate without the knowledge of BSP; b) Within 6 months of receiving the advice of approval receipt from the Monetary Board, TCs shall have their application for authority. They shall secure the certificate of authority to operate their business, and submit it to the BSP; c) Organizational requirements; d) Issuance of the Certificates of Authority to register and to operate.

The TC also has a limit of stockholders – domestic and foreign only. Foreign stockholders may own stocks in a TC, but they will be subjected to the limits decreed by the laws and regulations of the investing company’s home country or origin. Under Sec. 4402T entitled “Applicable Regulations on Trust and Other Fiduciary Activities”, Sec. 449Q is revised. This section talks about the sanctions called “Guidelines for the imposition of monetary penalty” under Appendix T-2 which would also be used by the TC.

Section 6: explains the item “v” of Appendix 48 from Subsec. X301.6a and 6b. is transferred to Subsec. X178.9 of the MORB.

Section 7: expounds the guidelines listed under Appendix 25 entitled “Risk Management Guidelines for Derivatives” of Sections X175 and X176 of the MORB that were deleted.

Section 8: enounces the amendment of the Appendix 25 introduction from MORB.

Section 9: clarifies that topic titles of items C&D in Part 9 of MORB are changed to items D&E instead.

Section 10: enunciates that the reference to Subsec. 4441N.62 in Appendix 68 (MORB) or Q-38 (MORNBFI) is changed. The former Section 8 in Circular no. 837 dated Mar. 25, 2015 is now revised to Subsection 4144N.6.

Section 11: lists the footnotes of the sections/subsections of the MORB/MORNBFI. Under the Transitory Provisions of Circulars, which was issued last year, Circular nos. 873 is at the X441 of MORB and 886 at the X321 and 4337S.

Section 12: notes the codified memoranda of the MORB. Memorandum nos. 5 (Jan. 20, 2015), 9 (Jan. 28, 2015) and 35 (Oct. 7, 2015) which states the regulatory relief of banks or NBQBS affected by calamities like typhoon Ruby and tropical storm Seniang, which are under: X257, X302, X306, X338, X192.2, X269.6, X269.8, and App. 18. Lastly, Memorandum no. 8 (Jan. 28, 2015) entitled “Strengthening Program for Rural Banks (SPRB) Plus is on App. 94A.

Section 13: talks about the modifications of the reportorial requirements and annual supervisory fees. Under Appendix 6 were Memorandum nos. 1, 4, 14, 15, 21, 26, 28, 29, 30, 31, 32, 33, and 36; X907.6 of Appendix 6 is Memorandum no. 34; and lastly, Memorandum no. 22 which is under X901.1 of App. 99, 49012.1 and App. Q-51.

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