Question & AnswerQ&A (BSP CIRCULAR LETTER)
The Euro is the common currency of the eleven countries in the European Monetary Union (EMU) starting January 1, 1999. It is a currency in its own right that replaced the legacy currencies of the EMU member countries.
The eleven countries are Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Portugal, and Spain.
The legacy currencies are the Austrian Schilling, Belgian Franc, Finnish Markka, French Franc, Deutsche Mark, Irish Punt, Italian Lira, Luxembourg Franc, Netherlands Guilders, Portuguese Escudo, and Spanish Peseta.
The Euro officially became a currency in its own right on January 1, 1999.
Euro notes and coins came into circulation on January 1, 2002.
The conversion rates of the legacy currencies to the Euro were fixed to six significant digits on December 31, 1998, and these rates remained unchanged for converting each currency to the Euro from January 1, 1999 to June 30, 2002.
Yes, the legacy currencies continued to be legal tender until replaced by Euro notes and coins, with a transition period where both the legacy currencies and the Euro coexisted between January 1, 2002 and June 30, 2002.
No, the conversion of existing accounts to Euro was not compulsory until December 31, 2001, when all accounts in the eleven currencies had to be closed and converted to Euro.
The procedure involves closing the legacy currency account and opening a new Euro account, calculated at the fixed conversion rate set on December 31, 1998, with conversion rates not truncated or rounded except in cases where rounding to nearest currency unit is necessary.
From January 4, 1998, it incorporated fixed conversion rates of legacy currencies to the Euro and corresponding daily foreign exchange rates to US dollars and Philippine pesos, which are used to convert accounts denominated in legacy currencies.
Yes, banks, non-bank financial institutions, government agencies, corporations, and private entities with existing foreign loans denominated in legacy currencies must notify the Bangko Sentral of loans converted.
The reporting system is revised to accommodate the Euro as a new currency starting January 1, 1999, and legacy currencies are deleted from its currency library by July 1, 2002.
Yes, Euro accounts may be maintained in any bank in any country in the European Union.
The Euro is a currency in its own right, while the ECU is a basket of currencies including eight legacy currencies and three non-legacy currencies.