Law Summary

Overview

BSP Circular No. 866, adopted on January 7, 2015, outlines the guidelines for the submission of reports by banks performing underwriting, brokering, dealing, and transfer agency activities. This circular modifies existing regulations and establishes specific reporting requirements to enhance compliance and accountability among financial institutions.

Section 1: Amendment to Subsection X192.3 of the Manual of Regulations for Banks (MORB)

• Explanation: The circular amends Subsection X192.3 concerning the submission of required information by banks to the appropriate department within the Supervision and Examination Sector (SES).

• Key Definitions:

  • Banks: Financial institutions authorized to engage in the activities specified.

• Requirements:

  • Banks must submit:
    1. Information on their profile as outlined in Appendix 7.
    2. Documents/information related to organizational structure and operational policies as per Appendix 8.

• Timeframes:

  • Changes in submitted information must be reported immediately.
  • Subsequent changes/issuances of documents must be reported within 15 banking days.

• Penalties:

  • For Banks:
    • Delay in Submission: Monetary penalties for failing to submit Category A-2 Reports by the deadline.
    • False/Misleading Statements: Monetary penalties for willfully making false statements, calculated daily from the due date until corrected documents are submitted.
  • For Concerned Officers:
    • Non-compliance: Monetary penalties for willful failure to comply with the circular.
    • False Statements: Similar penalties apply for willful false certifications, calculated daily until corrected.

Section 2: New Subsection 1192.3 for Universal Banks (UBs)

• Explanation: Establishes new reporting requirements specifically for Universal Banks registered as Underwriters.

• Key Definitions:

  • Universal Banks (UBs): Banks registered with SEC to perform underwriting functions.

• Requirements:

  • UBs must submit:
    1. A list of personnel performing underwriting functions.
    2. A notarized certification confirming the accuracy of the submitted list.

• Timeframes:

  • Reports must be submitted by December 15 every year.

• Penalties:

  • For Banks:
    • Delay in Submission: Similar monetary penalties as stated in Section 1 for delayed reporting.
    • False/Misleading Statements: Same penalties for willfully false statements.
  • For Concerned Officers:
    • Similar penalties for non-compliance and false statements as outlined in Section 1.

Section 3: Repealing Clause

• This circular modifies and amends existing provisions of Section X192, Subsection X192.3, and Appendix 6 of the MORB.

Section 4: Effectivity

• The circular takes effect 15 calendar days after publication in the Official Gazette or a newspaper of general circulation.

Key Takeaways

• Banks acting as underwriters, brokers, dealers, and transfer agents must adhere to new reporting requirements to ensure compliance and accountability.
• Strict deadlines are established for reporting, with significant penalties for non-compliance or submission of false information.
• Annual reporting for Universal Banks is mandated, emphasizing the importance of accurate personnel records and certifications.
• The circular reinforces regulatory oversight by the Bangko Sentral ng Pilipinas (BSP) in the banking sector's securities activities.