To make the Central Bank ceilings, loan values, and rediscount/lending rates in prior executive issuances directory (modifiable by the Monetary Board when warranted by economic conditions), thereby removing obstacles to interest rate reforms and monetary management.

The Central Bank of the Philippines (Bangko Sentral/CBP), specifically its preferential rediscounting and the related lending rates that banks may charge on paper rediscounted with the Central Bank.

They are treated as “directory,” meaning they may be modified by the Monetary Board whenever warranted by prevailing economic conditions, rather than being fixed as strict mandatory limits.

They are not absolute or immutable; they guide policy but do not prohibit the Monetary Board from adjusting them in accordance with the Central Bank’s Charter and prevailing economic conditions.

Letters of Instructions and other executive issuances that had fixed the ceilings, loan values, and rediscount rates for preferential rediscounting and the lending rates banks may charge on paper rediscounted with the Central Bank.

The Monetary Board of the Central Bank, as provided in the Central Bank’s Charter.

Modification must be “whenever warranted by prevailing economic conditions.”

Because fixed ceilings and rates limited the Central Bank’s flexibility to adjust interest rate policy in response to changing economic conditions.

It is consistent with the constitutional duty of the Central Bank to provide policy direction in money, banking, and credit.

That it must regulate the volume, costs, availability, and character of bank credit and provide the banking system with liquid funds in times of need, using the credit accommodations it is authorized to extend.

It repeals or modifies all issuances and regulations inconsistent with Executive Order No. 698.

They are repealed or modified to the extent they are inconsistent with the Executive Order.

Immediately, as stated in Section 3.

Its fixed ceilings become directory and may be modified by the Monetary Board in accordance with prevailing economic conditions and the Central Bank Charter.

No. It does not prescribe new numerical rates; it changes the legal character of existing ceilings/rates by making them directory and adjustable by the Monetary Board.

EO 698 expressly states that modifications by the Monetary Board must be made “in accordance with the provisions of its Charter,” grounding the Monetary Board’s authority in that Charter.

Banks’ ability to charge lending rates on papers rediscounted with the Central Bank would be subject to Monetary Board adjustments to the prior fixed or capped rates/values, allowing rate policy to respond to economic conditions.