BSP Issues Regulation Enabling Banks to Expand Service Delivery Channels

01.18.2017

In line with the thrust of the Bangko Sentral ng Pilipinas to create an enabling regulatory environment for innovations and allow banks to exponentially expand reach and serve clients more efficiently, the Monetary Board recently approved the guidelines for new bank service channels and relaxed existing regulations on deposit taking activities outside bank premises.

Under the new regulations, banks are now allowed, with prior BSP authorization, to serve clients through cash agents contracted by banks to accept and disburse cash in its behalf, facilitating online self-service deposits, withdrawals and fund transfers, as well as bills payment. Cash agents can also perform Know-Your-Customer procedures as well as collect and forward application documents for loan and account opening. They may also sell and service insurance as may be authorized by the Insurance Commission. These cash agents are typically cash rich third party entities with many outlets that conduct regular business in fixed locations anywhere in the country, such as convenience stores, pharmacies and other highly accessible retail outlets.

Cash agents enable banks to leverage on innovative digital solutions to serve a wider client base, particularly in the low-income and rural areas where there is limited commercial incentive to establish a full branch or even a micro-banking office (MBO). Through this new cost-efficient service channel, serving the currently unbanked and low-income segments can become more viable and sustainable for banks. Data from the BSP shows that more than 36% of all the municipalities in the country have no banking presence although most of these are served by a variety of non-bank financial institutions like pawnshops, cooperatives, and lending investors.

In addition to these new service delivery models, the Monetary Board also relaxed existing regulations on offsite deposit servicing as well as deposit solicitation, by removing highly prescriptive operational requirements and conditions before banks may engage and offer these services. The amended regulations provide banks with more flexibility in designing appropriate and cost-efficient ways to render deposit pick-up and delivery services and as a result, enhance client experience.

To ensure the safety and soundness of banks as well as to uphold consumer protection, the guidelines emphasize banks’ responsibility for ensuring the adequacy of risk management and internal control systems for these liberalized deposit servicing activities. The BSP will evaluate the quality and sufficiency of these risk management and control systems before granting authorization to perform banking services outside bank premises.

Source: http://www.bsp.gov.ph/publications/media.asp?id=4274

Amendment of Circular No. 910 dated 22 April 2O16

BSP CL 2017-002: Publication/Posting of Balance Sheet and Consolidated Balance Sheet (31 Dec 2016)

BSP CL 2017-001: Guidelines on the Issuance of DAR Clearance to Authorize the Transfer of Ownership of Agricultural Lands

BSP Circular 936-2016: Guidelines on the Implementation of EMV Card Fraud Liability Shift Framework with FAQs

BSP Circular 935-2016: Extension of the Deadline for the Exchange or Replacement of New Design Series Banknotes from 31 Dec 2016 to 31 Mar 2017

BSP Memo 023-2016: Regulatory Incentives for Mergers/Consolidations, Acquisitions of a Bank/Quasi-bank

BSP Memo No. 022-2016: Reminder on Handling Support for Magnetic Stripe Transactions Pending Full Compliance with EMV Migration Requirement

BSP Circular No. 932-2016: Amendments to Establishment/Relocation/Voluntary Closure/Sale of Branches

BSP Supervisory Process & Examination Approach on Bank’s Compliance – Oct 17 -Butuan City

One-Day Orientation/Briefing on BSP Supervisory Process and Examination
Approach on Monitoring Bank’s Compliance with the Single Borrower’s Limit

The Bangko Sentral ng Pilipinas, through the Central Point of Contact
Department III (CPCD III) and Examination Department III (ED III) and in
partnership with the Rural Bankers Association of the Philippines (RBAP)
invite you to attend the One-Day Orientation/Briefing of BSP Supervisory
Process and Examination Approach on Monitoring Bank’s Compliance with the
Single Borrower’s Limit.

DATE & VENUE
October 17, 2016 (Monday)

AMARIS SUITES
Rosario’s Restaurant & Convention Center J.P. Rosales Ave., Butuan City
Tel. No. 085-341-7379

RESOURCE SPEAKERS
Bangko Sentral ng Pilipinas

CARYL T. VALDEZ – Deputy Director, ED III
ALDRIN JAVIER – Deputy Director, CPCD III

TOPICS

1. BSP Supervisory Process

2. Compliance System
* Expectations of Compliance System

3.BSP Supervisory Enforcement Policy
* Enforcement framework

4.Expectations on Compliance with the Single Borrowers Limit (SBL)

EXPECTED PARTICIPANTS:

President, Chief Compliance Officers and Heads of Credit Risk Management
(CRM) /Loans Department

Should you be interested, kindly submit the CONFIRMATION FORM
training@rbap.org on or before OCTOBER 10, 2016. Lunch and
morning/afternoon snacks will be served. Please note that this is a
live-out seminar. Accommodation is on a first come, first serve basis due
to seats limit.

Download confirmation sheet in PDF

 

BSP Circular No. 908: Agricultural Value Chain Financing Framework

Agricultural Value Chain Financing Framework

BSP Memorandum No. M-2016- 005: Strengthening of Know-Your-Customer (KYC) Practices in View of the Reported Unauthorized Disclosure of Voters’ Registration Records

Memo No. M-2016-04 — Reminder on Sound Risk Management Practices when Dealing with Foreign Exchange Dealers, Money Changers, and Remittance Agents

7 April 2016

TO: All Rural Banks
RE: MEMORANDUM No. M-2016-04 – REMINDER ON SOUND RISK MANAGEMENT PRACTICES WHEN DEALING WITH FOREIGN EXCHANGE DEALERS, MONEY CHANGERS AND REMITTANCE AGENTS

Dear Rural Bankers,

Pursuant to Part 8 of the Manual of Regulations for Banks (MORB), banks dealing with foreign exchange dealers, money changers and remittance agents (FXDs, MCs and RAs) should take extra caution and vigilance and shall perform consistent with regulations and the bank’s procedures as provided under its Money Laundering and Terrorist Financing Prevention Program (MLPP). The bank’s MLPP should contain appropriate risk management practices to ensure that money laundering (ML) and terrorist financing (TF) risks arising from dealings with FXDs, MCs, and RAs are effectively identified, assessed, monitored, mitigated, and controlled. To this end, banks should ensure the soundness and adequacy of their risk management policies and practices in dealing with FXDs, MCs, and RAs, which include, among others, the following:

1. Banks shall only deal with FXDs, MCs and RAs registered with the BSP for the appropriate authority to engage in a specified business;

2. When dealing with RAs as remittance partners or tie up or if the accounts are being used to facilitate their business, the banks have the ultimate responsibility for conducting appropriate due diligence necessary to the relationship to ensure that it will not be used as channel for ML/TF activities. Bank’s tie-up relationship with such customers shall not be used to circumvent existing regulations;

3. Conduct risk assessment of the FXD, MC and RA customers, considering relevant factors such as business operations, types of customers, product/service availed, distribution channel, jurisdictions they are exposed to and expected account activity. By the nature of their business, they may inherently pose higher ML/TF risk which should be appropriately identified, monitored and mitigated;

4. Perform enhanced due diligence. Unsatisfactory result of the due diligence process shall be a ground for denying the business relationship.

5. Perform continuing account and transaction monitoring.

Banks are reminded that violation of the rules provided in Part 8 of the MORB shall be subject to applicable sanctions and penalties provided under Section X811 of the MORB.

For guidance and strict compliance.

You may also view/ download full copy of this memo through this link: http://rbap.org/wp-content/uploads/2016/04/m004.pdf

RBAP Secretariat

BSP Circular No. 2016-028: Authority of the Insurance Commissioner to Appoint a Conservator or Receiver of Insurance Companies

30 March 2016

TO: All Rural Banks
RE: AUTHORITY OF THE INSURANCE COMMISSIONER TO APPOINT A CONSERVATOR OR RECEIVER OF INSURANCE COMPANIES

Dear Rural Bankers:

The BSP, in a communication, advised all Banks of the authority of the Insurance Commissioner to appoint a conservator or receiver to take charge of, among others, the assets and liabilities of the insurance companies, pursuant to Sections 255 and 256 of the Insurance Code, which read as follows:

“Section 255. If at any time before, or after, the suspension or revocation of the certificate of authority of an insurance company as provided in the preceding title, the Commissioner finds that such company is in a state of continuing inability or unwillingness to maintain a condition of solvency or liquidity deemed adequate to protect the interest of policyholders and creditors, he may appoint a conservator to take charge of the assets, liabilities, and the management of such company, collect all moneys and debts due to said company and exercise all powers necessary to preserve the assets of said company, reorganize the management thereof, and restore its viability. The said conservator shall have the power to overrule or revoke the actions of the previous management and board of directors of the said company, any provision of law, or of the articles of incorporation or bylaws of the company, to the contrary notwithstanding, and such other powers as the Commissioner shall deem necessary.”

x x x

“Section 256. Whenever, or upon examination or other evidence, it shall be disclosed that the condition of any insurance company doing business in the Philippines is one of insolvency, or that its continuance in business would be hazardous to its policyholders and creditors, the Commissioner shall forthwith order the company to cease and desist from transacting business in the Philippines and shall designate a receiver to immediately take charge of its assets and liabilities, as expeditiously as possible collect and gather all the assets and administer the same for the benefit of its policyholders and creditors, and exercise all the powers necessary for these purposes including, but not limited to, bringing suits and foreclosing mortgages in the name of the insurance company.

x x x

For information and guidance.

To download copy of the circular please click through this link: http://rbap.org/wp-content/uploads/2016/03/cl028.pdf

RBAP Secretariat

APPROVED APPLICATIONS FOR NEW BANKING OFFICES AND OPENED BANKING OFFICES OF 4Q 2015

30 March 2016

TO: ALL RURAL BANKS
RE: APPROVED APPLICATIONS FOR NEW BANKING OFFICES AND OPENED BANKING OFFICES DURING THE 4TH QUARTER OF 2015

Dear Rural Bankers:

For information, listed below are the (1) approved applications for new banking offices, and (2) opened banking offices during the last quarter of 2015.

I. Approved Applications for New Banking Offices
Rural and Cooperative Banks

1. Banco Dipolog Inc., (A Rural Bank) – Extension office
2. Card Bank, Inc. (A Microfinance Oriented RB) – MBO
3. Cooperative Bank of Cotabato – MBO
4. Rizal Bank, Inc. (A Microfinance Oriented RB) – MBO

II. Opened Banking Offices
Rural and Cooperative Banks

1. BOF Inc. (A Rural Bank) – Regular Branch
2. Camalig Bank, Inc. (A Rural Bank) – Regular Branch
3. Card Bank, Inc. (A Microfinance Oriented RB) – MF Branch, MBO
4. East West Rural Bank Inc – Regular Branch, Extension Office
5. New Rural Bank of San Leonardo (N.E.), Inc. – Regular Branch
6. Rural Bank of Capalonga (Cam. Norte), Inc. – Regular OBO
7. Rural Bank of Medina (Mis. Or), Inc – Regular OBO
8. Rural Bank of Mexico, Inc. – Regular Branch

To view and/ or download complete list of approved banking offices applications, please click through this link: http://rbap.org/wp-content/uploads/2016/03/cl026.pdf

Sincerely,

(SGD)
VICENTE R. MENDOZA
Executive Director