With the effectivity date of the Truth in Lending Act fast approaching, we would like to call all member RBs to review the recently issued circular on the modified and updated Rules Implementing the Truth in Lending Act to Enhance Loan Transaction Transparency for Non-Bank Financial Institutions (NBFIs) under BSP Supervision, and Penal Provisions on Banks and NBFIs for Non-Compliance with the Applicable BSP Rules and Regulations. Kindly take note of the changes in the numberings, modified wordings and new subsections, which as stated above, help enhance transparency.
Particular attention should likewise be given to Section 7 of the Sanctions for non compliance, stipulating the new subsection X307.5 that will be added under the MORB and the amendments under the renumbered x320.16. The sanctions under the new subsection, in addition to the penalties under Republic Act 3765, are as follows: (1) First Offense: Reprimand the erring officers; (2) Second Offense: Reprimand the entire BOD; (3) Subsequent offense, suspension of erring officer or entire members of the BOD and restriction on lending activities.
To download the 16 page circular and sample disclosure form, kindly click RBAP’s Slideshare account link.
For your information and guidance.
