Legal basis and regulatory changes
- BSP Circular No. 209 amends Section 7 of BSP Circular No. 147 (October 24, 1997) to revise administrative sanctions for noncompliance with SME credit allocation ratios for each reporting period (Section 1).
- BSP Circular No. 209 amends Subsection X162.2(b)(1)(a) of the Manual of Regulations for Banks concerning fines for willful delay in submission of required reports (Section 2).
- BSP Circular No. 209 amends specific reporting forms and their submission terms under Appendices 6-A, 6-B, and 6-C (Sections 3, 4, and 5).
- BSP Circular No. 209 expressly ties the credit allocation compliance referenced in the sanctions to R.A. No. 6977, as amended by R.A. No. 8289 (e.g., report filing and compliance deadlines) (Sections 1 and 2).
- The circular states that the credit allocation sanctions under Section 7 are imposed without prejudice to other administrative sanctions under Section 37 of Republic Act No. 7653 (Section 1(A)).
Administrative sanctions for ratio noncompliance
- Section 7(A) of BSP Circular No. 147 (as amended by Section 1 of this circular) imposes administrative sanctions on banks for noncompliance/undercompliance with prescribed ratio requirements of the mandated credit allocation to small and medium enterprises for each reporting period.
- Noncompliance (zero compliance) triggers a fine of not less than Five Hundred Thousand Pesos (PHP 500,000.00) where a bank fails to meet at least 6% for small enterprises and at least 2% for medium enterprises (Section 7(A)(1)).
- Undercompliance fines are imposed based on the type of bank, calculated as daily fines per day of undercompliance:
- Expanded commercial banks (EKBs), Commercial Banks (KBs), and branches of Foreign Banks (FXBs): PHP 5,000 per day
- Thrift Banks (TBs): PHP 2,500 per day
- Rural Banks (RBs)/Cooperative Banks (Coop Banks): PHP 1,000 per day (Section 7(A)(2)).
- The reckoning period for the daily undercompliance fines starts from the end of the reference quarter and continues until the bank has fully complied with the credit allocation requirements (Section 7(A)(2)).
- Daily fines continue to run until the appropriate supervising and examining department receives an interim report that accurately shows the bank’s level of compliance with both the prescribed 6% and 2% credit allocation requirements (Section 7(A)(2)).
Administrative sanctions for false statements
- Section 7(A)(3) imposes a fine of not less than Five Hundred Thousand Pesos (PHP 500,000.00) uniformly on all banks that willfully make a false or misleading statement to the Bangko Sentral regarding compliance with the prescribed 6% (small enterprises) and 2% (medium enterprises) credit allocation requirements.
- The imposition of fines under Section 7(A)(1), (2), and (3) is imposed without prejudice to other administrative sanctions under items (b), (c), (d), and (e) of Section 37 of Republic Act No. 7653 (Section 1(A)).
Administrative sanctions for report nonsubmission/delay
- Section 7(B) imposes fines for non-submission or delayed submission of reports on compliance with the mandated credit allocation for each reporting period.
- For EKBs/KBs/FXBs, the fine is PHP 1,000 per business day of delay in submission (Section 7(B)).
- For TBs, the fine is PHP 500 per business day of delay (Section 7(B)).
- For RBs/Coop Banks, the fine is PHP 250 per business day of delay (Section 7(B)).
Fines for willful delay in required reports (X162.2)
- Section 2 amends Subsection X162.2(b)(1)(a) of the Manual of Regulations for Banks under “Sanctions in case of willful delay in the submission of reports/refusal to permit examination,” specifically fines for willful delay in submission of reports.
- The amendment provides an explicit fine schedule for “Category A-1, A-2 and A-3 reports” for banks that incur willful delay in filing required reports (Section 2; X162.2(b)(1)(a)).
- For Category A-1, A-2 and A-3 reports relating to general schedule, fines run per business day of default until the report is filed with the BSP:
- EKBs/KBs: PHP 1,200 per business day of default
- TBs: PHP 600 per business day of default
- RBs/Coop Banks: PHP 180 per business day of default (Section 2; X162.2(b)(1)(a)).
- For the specific report on compliance with the mandatory credit allocation required under R.A. No. 6977 (as amended by R.A. No. 8289), fines run per business day of default until the report on compliance is filed with the BSP:
- EKBs/KBs: PHP 1,000 per business day of default
- TBs: PHP 500 per business day of default
- RBs/Coop Banks: PHP 250 per business day of default (Section 2; X162.2(b)(1)(a)).
Reporting forms, frequency, and deadlines
- Appendix 6-A reporting for DCB I/II Form 61 is amended under the provisions on DCB I/II Form 61 (Funds Set Aside for Small Enterprise Credit Under R.A. No. 6977) in Appendix 6-A (Section 3).
- Section 3 adds/updates the reporting line for “Report on Compliance with Mandatory Credit Allocation Required under R.A. No. 6977 (as amended by R.A. No. 8289)”:
- Category: A-3
- Form No.: DCB I/II Form 6
- MOR Ref.: X342.6
- Frequency: Quarterly
- Deadline: 15 banking days after end of reference quarter
- Procedure: Original and duplicate a DCB I/II Triplicate– SMED Council (Section 3).
- Appendix 6-B reporting for TB Form II is amended for the “Report on Compliance with Mandatory Allocation Required under R.A. No. 6977 (as amended by R.A. No. 8289)”:
- Category: A-3
- Form No.: TB Form II
- MOR Ref.: X342.6
- Frequency: Quarterly
- Deadline: 15 banking days after end of reference quarter
- Procedure: Original and duplicate DTBNFI Triplicate SMED Council (Section 4).
- Appendix 6-C reporting for RB/COB Form 12 is amended for the “Report on Compliance with Mandatory Credit Allocation Required under R.A. No. 6977 (as amended by R.A. No. 8289)”:
- Category: A-3
- Form: RB/COB
- Frequency: Quarterly
- Deadline: 15 banking days after end of reference quarter
- Procedure: Original and duplicate DRB Triplicate SMED Council (Section 5).
Administrative structure references
- The undercompliance daily fines continue until receipt by the appropriate supervising and examining department of an interim report showing compliance with both the 6% and 2% requirements (Section 1(A)(2)).
- Report submissions and compliance references are operationally tied to reporting obligations for R.A. No. 6977, as amended by R.A. No. 8289, through BSP reporting forms and the BSP filing requirement for compliance reports (Sections 2, 3, 4, and 5).