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Peso Rediscounting Rate

19 August 2004

Mr. Senen D. Glorioso
President
Rural Bankers Association of the Philippines
RBAP Bldg., A. Soriano Ave., cor. Arzobispo St.
Intramuros, 1000 Manila

Dear Mr. Glorioso:

In accordance with Bangko Sentral ng Pilipinas (BSP) Circular No. 411 dated 29 October 2003, we wish to inform you that effective 4 December 2004, the peso rediscounting rate shall revert automatically to the market-based pricing mechanism provided for under Subsection X269.5 of the Manual of Regulations for Banks (MORB), as amended by Circular No. 354 dated 4 October 2002, to wit:

The rediscount rates for peso loans shall be based on the applicable Treasury Bill (TB) rates for the preceding week as follows:

Loan Maturity

Applicable TD Rate
90 days or less 91-day
91-180 days 182-day
181-360 days 364-day

Please disseminate the foregoing to your member-banks.

Thank you.

Very truly yours,

-SGD_
ROLANDO ALEJANDRO Q. AGUSTIN
Director
Department of Loans and Credit