Question & AnswerQ&A (Republic Act No. 11211)
The Bangko Sentral ng Filipinas is an independent central monetary authority established as a body corporate, created under Section 2 of Republic Act No. 11211, amending Republic Act No. 7653, with an authorized capital of Two hundred billion pesos (P200,000,000,000) subscribed by the Government of the Republic of the Philippines.
The primary objective of the Bangko Sentral ng Filipinas is to maintain price stability conducive to balanced and sustainable growth of the economy and employment. Additionally, it promotes and maintains monetary stability and the convertibility of the peso.
The Monetary Board has supervision over operations of banks, quasi-banks, and certain non-bank financial institutions, including money service businesses, credit granting businesses, and payment system operators. It can exercise regulatory and examination powers and authorize entities to engage in money service businesses.
The Monetary Board shall meet at least once a week. A quorum requires the presence of four members, and in all cases, the Governor or his alternate must be among the four members. Decisions require the concurrence of at least four members.
Members and officials of the Bangko Sentral, including supervisory personnel, are indemnified against costs and expenses incurred in legal proceedings related to their duties unless adjudged liable for willful violation, bad faith, or gross negligence. Advances for defense costs may be provided with an undertaking to repay if indemnity is not warranted.
Personnel are prohibited from disclosing confidential information, including discussions or resolutions of the Monetary Board, without authorization or related to their official functions. Disclosure required by law to the President or Congress is not considered confidential. Unauthorized use of such information for personal gain or to detriment is also prohibited.
The Bangko Sentral can require data from any person or entity, including government agencies and enterprises, for statistical and policy development purposes. It has subpoena power for the production of books and records. Refusal without justifiable cause can lead to punishment for contempt.
Such transfers or acquisitions require prior approval of the Bangko Sentral. Without approval, the transfer has no legal effect and is not recognized in the institution’s books. Transfer of control before approval can result in liability under relevant provisions, and the Bangko Sentral may share related information with the Philippine Deposit Insurance Corporation (PDIC).
Willful refusal to make required reports or to permit lawful examination leads to fines ranging from Fifty thousand pesos (P50,000) to Two million pesos (P2,000,000), imprisonment from one to five years, or both, at the court’s discretion.
Sanctions include fines up to One million pesos (P1,000,000) per violation or One hundred thousand pesos (P100,000) per day for continuing violations; suspension of rediscounting privileges, lending or foreign exchange operations, interbank clearing privileges; and suspension or revocation of licenses. Directors or officers may also be preventively suspended during investigation.
In emergencies or financial panic, the Monetary Board may approve extraordinary loans up to fifty percent (50%) of total deposits, disbursed in tranches, secured by government securities or other acceptable collateral. Under certain conditions, the amounts and terms can be adjusted, with indemnity undertakings from principal stockholders.
In foreclosure cases, natural person mortgagors have one year to redeem the property by paying the principal, interests, charges, and costs. Juridical persons have the same right for judicial foreclosures but ninety days for extrajudicial foreclosures. The Bangko Sentral may possess the property during the redemption period and is entitled to its fruits to be applied to the redemption price.
The Bangko Sentral must publish and submit quarterly economic and financial analysis, annual budget and profit/loss statements, biannual review of the financial system, and timely reports on abnormal monetary and price movements along with remedial measures.
The Bangko Sentral shall not acquire shares or participate in ownership or management of any enterprise directly or indirectly, except when approved by at least five Monetary Board members for necessary membership in international organizations or consistent with its mandate without conflicts of interest. It does not engage in development banking or financing.
Such offenses are punishable by fines from One hundred thousand pesos (P100,000) to Two million pesos (P2,000,000), imprisonment of up to five years, or both, at the discretion of the court.