Question & AnswerQ&A (BSP CIRCULAR NO. 682, S. OF 2010)
The primary purpose of a Cooperative Bank is to provide a wide range of financial services to cooperatives and their members.
Cooperative Banks are governed under Chapter XII of Republic Act No. 9520, known as the Philippine Cooperative Code of 2008, which amends Republic Act No. 6938.
A Cooperative Bank must have a minimum paid-in capital of Ten Million Pesos (Php 10,000,000.00).
Only cooperative organizations duly established and registered under the Philippine Cooperative Code of 2008 (R.A. No. 9520) are eligible to organize a Cooperative Bank.
No cooperative member shall own or control more than forty percent (40%) of the total capital contributions of a Cooperative Bank.
At least one member of the Board of Directors must have one year of banking experience, and the manager of the Cooperative Bank must have actual banking experience, preferably as a manager or assistant manager.
Yes, while the primary service is to cooperatives and their members, a Cooperative Bank may also provide the same services to non-members or the general public, subject to BSP regulations.
The quorum requirement is one-half plus one of the number of voting shares of all members in good standing.
At least five cooperatives may form a Cooperative Bank, and the majority of the voting shares must be held by cooperatives located in the province where the head office is located.
- Php 10 Million to establish branches/extension offices within the province where the head office is located. - Php 50 Million to establish branches/extension offices in any island group except Metro Manila. - Php 100 Million to establish branches anywhere in the country except Metro Manila, unless qualified.
Members' voting rights are proportionate to the number of their paid-up shares. Each director in board meetings has one vote.
They shall be registered with the Cooperative Development Authority (CDA) only when accompanied by a certificate of authority issued by the Monetary Board.
Cooperative Banks receive the same privileges and incentives as other banks (rural, thrift, commercial, universal) such as rediscounting notes with BSP and government banks. Additionally, foreclosures on loans under Php 250,000 are exempt from newspaper publication requirements.
Yes, with respect to their operations and governance, banking laws, rules, and regulations prevail despite Section 71 of RA 8791.
They must convert to full-fledged cooperatives within one year from March 22, 2009. Failure to do so will result in their common shares being converted to preferred shares.