Question & AnswerQ&A (Republic Act No. 8367)
The short title of the Act is the 'Revised Non-Stock Savings and Loan Association Act of 1997.'
The State policy is to encourage savings and credit utilization among members, regulate and supervise such associations for sound and efficient operation, lay down minimum standards for organization and operation, and maximize protection of members against trustee and officer misconduct.
It is a non-stock, non-profit corporation that accumulates savings of members and uses the funds to grant loans to members for household needs, home building, and personal finance.
An association must be formed by at least five but not more than fifteen members of a well-defined group, must secure a license from the Monetary Board, and register with the Securities and Exchange Commission. The articles of incorporation and bylaws require Monetary Board approval before SEC registration.
It includes employees, officers, and directors of a single company (including member-retirees), government employees of the same office or department (including retirees), and immediate family members up to second degree of consanguinity or affinity of these persons, as defined by the Monetary Board.
Yes, income including interest on deposits is exempt from income tax, except for income derived from property or activities conducted for profit, which are subject to taxes under the National Internal Revenue Code.
All deposits are confidential and cannot be examined or disclosed except with depositor's written permission, in impeachment cases, by court order in cases of bribery, dereliction of duty, or litigation involving the deposited money. Violations by officials or employees are punishable under Republic Act No. 1405.
Loans to members should not exceed their deposits plus twelve months of their salary or 70% of the fair market value of acceptable collateral. Loan maturity must not exceed five years except for home-building or agricultural loans, which can be up to 25 years. Deductions of loan payments from salary are mandatory.
Loans may be made to trustees or officers only with written approval of the majority of trustees excluding the concerned trustee and must not exceed 20% of the association's capital contributions. Transactions must be on terms not more favorable than those for other members. Violations lead to forfeiture of office and criminal penalties.
Such officers, employees, or agents are liable to a fine of up to Ten thousand pesos or thrice the loan amount, or imprisonment for up to one year, at the court's discretion.