QuestionsQuestions (BSP MEMORANDUM)
It sets out procedures for banks/NBQBs that intend to transfer/sell their non-performing assets (NPAs) to a Special Purpose Vehicle (SPV), to an individual involving a single family residential unit, or through dacion en pago by the borrower or third party, to obtain a Certificate of Eligibility (COE) required under R.A. No. 9182 for incentives.
It must coordinate with the BSP through the Supervisory Reports and Studies Office (SRSO) and the appropriate Supervision and Examination Department (SED) to develop a reconciled and finalized master list of its eligible NPAs.
Only NPAs included in the bank’s/ NBQB’s reconciled master list that meet the definitions of NPA, NPL, and ROPOA under R.A. No. 9182 may qualify for the COE.
It must be filed in writing (hard copy) by the selling bank/NBQB with the BSP through the appropriate SED for each proposed transfer of asset/s, describing the transaction in sufficient detail, including counterparty/ies and terms, conditions, and material commitments.
The list of NPAs must be submitted in soft copy (by email or diskette) in Excel format using the prescribed data structure/format for NPLs and ROPOAs (Attachments 2-1 to 2-4) to the appropriate SED email addresses.
It is preferable to submit the list also in soft copy; however, hard copy is allowed if all necessary information shown in the prescribed data structure relevant to each NPL or ROPOA is indicated.
The application must be accompanied by a written certification signed by a senior officer with at least Senior Vice President rank (or equivalent), authorized by the board (or by the country head for foreign banks), certifying specified matters including eligibility as NPAs under the SPV Act, true sale, borrower notification compliance, and compliance with the maximum 90-day renegotiation/restructuring period (with an exception when NPL becomes ROPOA after June 30, 2002).
It must certify that the proposed sale/transfer of the NPAs is under a true sale.
The certification must state that the notification requirement to borrowers has been complied with and that the maximum 90-day period for renegotiation and restructuring has been complied with; however, items on notification and the 90-day period do not apply if the NPL has become a ROPOA after June 30, 2002.
If the NPL is settled through dacion en pago, the COE application on the NPL must be accompanied by a Deed of Dacion executed by the borrower, the third party, the registered owner of the property, and the bank/NBQB.
The appropriate SED may conduct an on-site review of the proposed NPLs and ROPOAs to be transferred/sold.
Processing fee per COE equals 1/100 of 1% of the transfer price, but not below P10,000 if the transfer is to an SPV, or not below P3,000 if the transfer is to an individual or in a dacion en pago arrangement by an individual or corporate borrower.
The SPV must file an application with the SEC for such transfer/sale; the SEC issues the corresponding COE based on the BSP COE database.
The individual must file an application for another COE with the BSP through the bank/NBQB from which the NPA was acquired, indicating the previous COE issued for the NPA and the name, address, and TIN of the transferee/buyer.
A processing fee of P3,000 shall be collected by BSP upon issuance of the COE.
It takes effect immediately upon adoption on June 17, 2003.