QuestionsQuestions (BSP CIRCULAR LETTER S. 1992)
It provides guidelines for reconciling and determining the “true and accurate” balances of foreign investors’ stockholdings that appear in the records of stock brokers/custodian banks (SB/CB) versus those in the Central Bank (CBP).
It is issued in line with Circular No. 1318 dated January 3, 1992. The Circular Letter supplements it by giving specific reconciliation guidelines for foreign investor stockholdings balances.
The lesser balance will be adopted as true and accurate.
All of the balances of the SB/CB combined shall be adopted as true and accurate, even if in some STD numbers the CBP balances would be the lesser with respect to the SB/CB combined.
The rule on Item 1 shall be followed.
It first checks whether SB/CB aggregates are less than CBP aggregates (Item 2—use all SB/CB combined). If CBP aggregates are less than SB/CB aggregates (Item 3—apply Item 1). When reconciling individual foreign investor accounts under the applicable scenario, the lesser balance is generally adopted as true and accurate (Item 1).
It refers to the foreign investor’s specific securities account balance as reflected separately in CBP records and in the combined SB/CB records for the same listed security.
It refers to each particular security traded/listed on which balances are being reconciled. The rules are applied per listed security, not generally across all securities.
On or before April 30, 1992.
As of February 28, 1992.
To the Central Bank through the Foreign Exchange Operations and Investments Department (Attn.: FX Securities Transactions Division).
Brokers and designated custodian banks must submit the inventory in the prescribed form (specified in the Circular Letter as available upon request at the Office of the National Administrative Register, U.P. Law Center).
Any data submitted after April 30, 1992 shall no longer be taken into account in arriving at investors’ balances.
Stock brokers and designated custodian banks.
It directs how to determine the correct balances to be used when CBP and SB/CB records differ, by applying the specific rules (Items 1–3) based on individual and aggregate comparisons.
It indicates the formal adoption and issuance of the circular letter by the BSP Governor, making the guidelines binding for the covered regulated entities under BSP authority.