Article 151p. 151

COMMERCIAL LAWS NEGOTIABLE INSTRUMENTS, CORPORATION, INSURANCE, TRANSPORTATION, BANKING

nor

quasi-bank

declare dividends, if at the time of

declaration:

57.1 Its clearing account with the Bangko Sentral is

overdrawn; or

57.2 It is deficient in the required liquidity floor for

government deposits for five (5) or more consecutive

days; or

57.3 It does not comply with the liquidity standards/ratios

prescribed

by

the

Bangko

Sentral

for

purposes

of

determining funds available for dividend declaration; or

57.4 It has committed a major violation as may be

determined by the Bangko Sentral. (84a)

SECTION 58. Independent Auditor . — The Monetary

Board may require a bank, quasi-bank or trust entity to

engage the services of an independent auditor to be

chosen by the bank, quasi-bank or trust entity concerned

from a list of certified public accountants acceptable to

the Monetary Board. The term of the engagement shall

be as prescribed by the Monetary Board which may

either be on a continuing basis where the auditor shall

act as resident examiner, or on the basis of special

engagements; but in any case, the independent auditor

shall be responsible to the bank's, quasi-bank's or trust

entity's board of directors. A copy of the report shall be

furnished to the Monetary Board. The Monetary Board

may

also

direct

the

board

of

directors

of

a bank,

quasi-bank, trusty entity and/or the individual members

thereof, to conduct, either personally or by a committee

created by the board, an annual balance sheet audit of

the bank, quasi-bank or trust entity to review the internal

audit and control system of the bank, quasi-bank or trust

entity and to submit a report of such audit. (6-Da)

SECTION

59.

Authority

to

Regulate

Electronic

Transactions .

— The Bangko Sentral shall have full

authority to regulate the use of electronic devices, such as

computers, and processes for recording, storing and

transmitting information or data in connection with the

operations of a bank, quasi-bank or trust entity, including

the delivery of services and products to customers by

such entity. (n)

SECTION

60.

Financial

Statements .

—

Every

bank,

quasi-bank or trust entity shall submit to the appropriate

supervising and examining department of the Bangko

Sentral financial statements in such form and frequency

as may be prescribed by the Bangko Sentral. Such

statements,

which

shall

be

as

of

a

specific

date

designated by the Bangko Sentral, shall show the actual

financial

condition

of the institution submitting the

statement, and of its branches, offices, subsidiaries and

affiliates, including the results of its operations, and shall

contain such information as may be required in Bangko

Sentral regulations. (n)

SECTION 61. Publication of Financial Statements . —

Every bank, quasi-bank or trust entity, shall publish a

statement of its financial condition, including those of its

subsidiaries and affiliates, in such terms understandable

to

the

layman

and

in

such

frequency

as

may

be

prescribed by the Bangko Sentral, in English or Filipino, at

least once every quarter in a newspaper of general

circulation in the city or province where the principal

office, in the case of a domestic institution, or the

principal branch or office in the case of a foreign bank, is

located, but if no newspaper is published in the same

province, then in a newspaper published in Metro Manila

or in the nearest city or province.

The Bangko Sentral may by regulation prescribe the

newspaper where the statements prescribed herein shall

be published.

The

Monetary

Board may allow the posting of the

financial statements of a bank, quasi-bank or trust entity

in

public

places

it

may

determine,

in

lieu

of

the

publication required in the preceding paragraph, when

warranted by the circumstances.

Additionally, banks shall make available to the public in

such form and manner as the Bangko Sentral may

prescribe

the

complete

set

of

its

audited

financial

statements as well as such other relevant information

including

those

on

enterprises

majority-owned

or

controlled by the bank, that will inform the public of the

true financial condition of a bank as of any given time.

In periods of national and/or local emergency or of

imminent panic which directly threaten monetary and

banking stability, the Monetary Board, by a vote of at least

five

(5) of its members, in special cases and upon

application of the bank, quasi-bank or trust entity, may

allow such bank, quasi-bank or trust entity to defer for a

stated period of time the publication of the statement of

financial condition required herein. (n)

SECTION 62. Publication of Capital Stock . — A bank,

quasi-bank or trust entity incorporated under the laws of

the Philippines shall not publish the amount of its

authorized or subscribed capital stock without indicating

at

the same time and with equal prominence, the

amount of its capital actually paid up.

No branch of any foreign bank doing business in the

Philippines shall in any way announce the amount of the

capital and surplus of its head office, or of the bank in its

entirety without indicating at the same time and with

equal prominence the amount of the capital, if any,

definitely assigned to such branch. In case no capital has

been definitely assigned to such branch, such fact shall

be stated in, and shall form part of the publication. (82)

SECTION 63. Settlement of Disputes . — The provisions of

any law to the contrary notwithstanding, the Bangko

Sentral shall be consulted by other government agencies

or instrumentalities in actions or proceedings initiated by

or brought before them involving controversies in banks,

quasi-banks or trust entities arising out of and involving

relations between and among their directors, officers or

stockholders, as well as disputes between any or all of

them and the bank, quasi-bank or trust entity of which

they are directors, officers or stockholders. (n)

SECTION 64. Unauthorized Advertisement or Business

Representation . — No person, association, or corporation

unless duly authorized to engage in the business of a

bank,

quasi-bank,

trust

entity,

or

savings

and

loan

association as defined in this Act, or other banking laws,

shall advertise or hold itself out as being engaged in the

business

of

such

bank,

quasi-bank,

trust

entity,

or

association, or use in connection with its business title,

the

word

or

words

"bank",

"banking",

"banker",

"quasi-bank",

"quasi-banking",

"quasi-banker",

"savings

and loan association", "trust corporation", "trust company"

or words of similar import or transact in any manner the

business of any such bank, corporation or association. (6)

SECTION 65. Service Fees . — The Bangko Sentral may

charge equitable rates, commissions or fees, as may be

prescribed

by

the

Monetary

Board

for

supervision,

examination and other services which it renders under

this Act. (n)

SECTION 66. Penalty for Violation of this Act . — Unless

otherwise herein provided, the violation of any of the

provisions of this Act shall be subject to Sections 34, 35, 36

and 37 of the New Central Bank Act . If the offender is a

director or officer of a bank, quasi-bank or trust entity, the

Monetary

Board may also suspend or remove such

director or officer. If the violation is committed by a

corporation, such corporation may be dissolved by quo

warranto proceedings instituted by the Solicitor General.

(87)

CHAPTER V Placement Under Conservatorship

SECTION

67.

Conservatorship .

—

The

grounds

and

procedures for placing a bank under conservatorship, as

well

as,

the

powers

and

duties

of

the conservator

appointed

for

the

bank

shall

be

governed

by

the

provisions of Section 29 and the last two paragraphs of

Section 30 of the New Central Bank Act : Provided , That

this

Section

shall

also

apply

to

conservatorship

proceedings of quasi-banks. (n)

© Compiled by RGL

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