Collection of the Annual Supervisory Fees (ASF) for the Year 2015

Bnruoxo SerurnlL No Prr-lprruas OFFICE OF THE DEPUTY GOVERNOR SUPERVISION AND EXAMINATION SECTOR MEMORANDUM NO. M-2015. 022 TO : ALL BANKS AND NON-BANKS WITH QUAST-BANK|NG (NBQBs) FUNCTIONS Subject : Collection of the Annual Supervisory Fees (ASF) for the year 2015 - Pursuant to Section X901.1 (2008 X608.1) and 4901.1Q (2008 4G52Q of the - Manual of Regulations for Banks (MORB) and the Manual of Regulations for Non-Bank Financial Institutions (MORBNFI), respectively, as amended by Circular No. 791 dated 3 April 20L3, the following guidelines shall govern the computation and collection by the Bangko sentral Ng Pilipinas (BSP) and the payment by Banks and NBeBs of the 2015 AsF. 1. Computation of ASF for 2015 The ASF is based on the Average Assessable Assets (AAA) of the preceding year multiplied by the applicable assessment rates approved by the Monetary Board as follows: Type of Financial Institution Applicable Rate UniversaUCommercial Banks L/28 of L% Thrift Banks t/28 of L% Ru ral/Cooperative Ban ks L/40 of to/o NBQBs L/28 of L% The AAA of the preceding year is derived from the reportsl submitted by the bank/NBQB to the BSP in compliance with the standards and requirements prescribed under existing regulations. In case of a merger or consolidation, the assets of the covered institutions prior to the merger or consolidation as well as the assets of the newly formed institution shall be considered in determining the AAA. ' FRP for banks, CSOC for NBQBs, and FRPTI for banks and NBQBs with Trust functions

The collection of the 2015 ASF shall take into consideration events subsequent to the collection of the 2014 ASF, particularly for submitted amendments to the prescribed reports used in deriving the AAA that would warrant a recomputation of the 2014 ASF. In such cases, the resulting over- or under-payment of the 2014 ASF shall be deducted/added to the 2015 AsF. Sample computations to illustrate potential permutations of the above described scenarios are provided in Annex A. 2. Notification of Amount Due for 2015 and Mode of payment The BSP Supervisory Data Center (SDC) shall send a billing notice in May 2015 to the Bank/NBqg for its ASF payment indicating, among others, the computation of the ASF due, including the 2% creditable withholding tax (CWT) thereon, if applicable, the period covered by the ASF and the specific date when the ASF will be debited from the Bank's/NBQB's Demand Deposit Account (DDA) with the BSP. The BSP will not accept checks as mode of ASF payment. Banks/NBeBs, upon receipt of the ASF billing notice from the BSP, should maintain adequate balance in their DDA to cover the ASF and other daily obligations and, when necessary, make corresponding deposits to fully cover said obligations. In case of deficienry, the provisions on DDA deficienry in Sections X9O1 (2003 - X60g.1) and 4901.1Q (2008 - 4552q of the MORB and MORNBFI, respectively, as amended, shall apply. 3. Exceptions Noted on Billing Notice of 2015 ASF Upon receipt of the BSP Notice of ASF billing, a Bank/NBeB is encouraged to check the accuracy of the billing and to submit any of the noted exceptions therein not later than ten (10) days before the specified date of collection/debit to DDA as indicated in the billing notice. The said exceptions, together with supporting documents, shall be submitted to: The Director Supervisory Data Center (SDC) Bangko Sentral Ng Pilipinas 11th Floor, Multi-Storey Building BSP Complex, A. MabiniStreet Malate, Manila 1004 Any exceptions received after the cut-off date or any exceptions not duly substantiated with documents before the cut-off date will be evaluated and considered in the computation of the ASF for the immediately succeeding year.

4. Withholding Tax on 2015 Supervisory Fees The following shall apply to Banks/NBQBs covered by Sections M and N of Bureau of Internal Revenue (BlR) Revenue Regulations (R.R.) No. 2_9g, as amended by R.R. No. 17-2003, and R.R. No. 2-2006: 4.L within seven (71 days from date of this Memorandum, the concerned Bank/NBQB shall submit a written representation to BSp, (at the address indicated in section 3 hereof), on whether or not it is included among the institutions covered under sections M or N of R.R. No. 2-98, as amended. rf available, a certified true copy of the BIR Notice classifying it under section M of R.R. No. 2-9g, as amended, shall be attached to the written representation. The submission of the written representation or BIR Notice shall no longer be necessary if previously transmitted and received by the BSP in connection with previous ASF assessments. 4.2 The ASF, net of the 2% cwr, shall be debited from their respective DDAs on the specified date referred to in the notice of ASF billing under Section 2 above. 4.3 Three (3) original signed copies of BIR Form No. 2307 certificate of creditable Tax withheld at source, which exclusively pertain to the withholding on ASF shall be submitted to the sDC at the address provided in section 3 above on or before 30 september 2015. The BIR Form No. 2307 shall accurately indicate, among others, the following details: 4.3.L Payee: Bangko Sentral ng pilipinas 4.3.2 Tax ldentification Number: 000-354-790-000 4.3.3 Address: A. Mabini St. corner p. Ocampo Sr. St., Malate, Manila 4.3.4 Zip Code: 1004 4.3.5 The B|R-registered name of the payor-bank/-NBeB, as exactly indicated in the BtR Certificate of Registration (BlR Form No. 2303) of the Bank/NBeB. 4.3.6 the amount of income payment pertaining to the gross ASF 4.3.7 the tax withheld 4.3.8 the period of tax return. Furthermore, the BIR Form No. 2307 - certificate of creditable Tax withheld at source covering the withholding on ASF should not include other transactions with BSp and should pertain exclusively to the ASF. lf the concerned Banks/NBeBs have other transactions with BSP, a separate BIR Form 2307 for the transaction/s shall be provided to BSp.

4.4 ln case of failure of concerned Bank/NBeB to submit the duly accomplished forms within the deadline stated above or if such forms contain errors and discrepancies that would render the BIR Form No. 2307 invalid for claiming tax credits, the BSP shall be constrained to immediately debit an amount equivalent to the 2% CWT from the DDA of Banks/NBQBs concerned, with no obligation on the part of the BSP to reimburse said amount. ln case of DDA deficiency, the provisions in Sections X901.1 (2008-X609.1) and 4901e.1 (2008_ 4652Q of the MORB and MORNBFI, respectively, as amended, shall applv. This Memorandum shalltake effect immediately. For strict compliance. t Deputy Governor OC vay 2015

Annex A Scenarios for computation of 2015 Annual Supervisorv Fee (ASF) Amounts in Thousand pesos 1' consolidation: Two or more entities combine to form a new single entity. The original entities cease operatlons after the new entity starts its operation scenario A - RB A and TB B consolldated in Feb 2015 to form a new TB C. The assessment of the 2015 ASF is on May 2015 since the consolidation was prior to the assessment for 2015 AsF, the AAA of the two banks in 2014 will be combined and the TB rate will be applied 2014 FRP Asset Balances RBA I EB I rec Jan t64,658,792 Feb 163,861,845 Mar 2I,928,5A4 L6s,3LI,226 Apr 153,357,155 May L54,30t,374 Jun 22,295,t42 168,488,963 Jul L70,373,352 Aug L70,278,229 Sep 22,320,467 758,700,7U Oct 768,L86,770 Nov 777,770,889 Dec 22,383,648 t92,866.28t Sum ofAssets 88,927,762 2,019,095,540 No. of reporting periods 4 L2 Average Assessable Assets 22,23I,940 L68,L74,637 L90,4A6,577 ASF rate forTB lL/2a ot I%l 0.000357143 ASF for 2015 for TB C 68,002 scenario B - RB X and TB y consoridated in Novemb er 20t4to form a new TB z. The 2014 AAA of RB X as reported in its FRP for 3 quarters will be combined with the 2014 AAA of TB y and the 2014 MA of TB Z and the TB rate will be applied Jan Feb Mar Apr May Jun Jul Aug sep Oct NoV Dec Sum of fusets No. of reporting periods Average Assessable Assets ASF rate totT9 (ll2g of I%l ASF for 2015 for TB Z

Z. na"rg"r, One entity absorbs another entlty and cdntinue to operate as the surviving entity while the absorbed entity ceases to operate scenario c - RB D and TB E merged in February 2015 with TB E as the surviving entity The 2014 AAA of RB D as reported in its FRP for 4 quarters will be combined with the 2ol4 AAA of TB E and the TB rate will be applied 2014 FRP Asset Balances RBD I reE I rotal Jan L54,367,6L8 Feb 153,620,480 Mar L54,979,274 Apr L43,772,333 May L44,657,539 Jun 23,606,62t 157,958,403 Jul t59,725,OLg . t' Aug 159,535,840 sep 23,633,436 158,155,966 Oct ., ,; ' : t57,675,097 . i, Nov , , t.:,.1 173,442,6A7 Dec 23,70A334 187,318,015 Sum ofAssets 94158,805 1,905,309,189 No. of reporting periods A L2 Average Assessable Assets 23,539,702 L58,775,766 ].,82.,3Ls,467 ASF rate for TB (1/28 of 1%) 0.000357143 ASF for 2015 for TB E 65.113 Scenario D - RB V and TB W merged in November 2014 with TB W as the surviving entity The 2014 AAA of RB V as reported in its FRP for 3 quarters will be combined with the 2014 AAA of TB w and the TB rate will be applied 2l 14 FRP Asset Balances RBV TBW I rot"t Jan L85,24I,L4L t.'' Feb , ,. .: 'i. L94,3M,575 Mar 24,508,328 L85,975,L29 Apr L72,526,800 May 173,589,046 Jun 24,9t8,LOA 189,550,084 ,',^ ' '1 Jul '., tgL,67O,OzL Aug t tt t"",1 191,563,007 , Sep 24,946,4O4 189,788,360 Oct .. :, ' ', 214,734,764 Nov I : 236,208,240 Dec 25s,104,899 Sum ofAssets 74,372,832 2,370,296,066 No. of reporting periods L2 Average Assessable Assets 24,79A,9M I97,524,672 222,3L5,6t6 ASF rate forTB (1128 ot tYo) : 0.@0357143 ASF for 2015 for TB W 79,398

: ' 3. Amendment of reports used in the computation of ASF Scenario E - RB E amended its Dec 2013 FRp in Feb 2015 The 2014 ASF will be recomputed and the resulting under/(over) collection will be added/(deducted) from the 2015 ASF Computation of 2015 ASF tRecamputotion of 2014 ASF RB E 2014 FRP RB E 2013 FRP Asset Bolances Asset Balances Originol Amended Mar 19,8&,645 Mor 78,522,548 18,522,548 20,L96,776 19,605,79i 19,605,793 20,279,7L7 sep 20,644,772 20,644,772 20,276,952 Dec 2L4A.407 2 ofAssets 80,257,520 80,656,577 Sum ofAssets 80,558,090 No. of reporting periods 44 No. ofreporting periods 4 Assessoble Assets 24,064,380 20,764,143 Average Assessable Assets ZO,L39,SZL rote for RB ft/ao of 1/o) 0.0002s ASF rate for RB (l/4O ot L%l 0.00025 Recomputed ASF for 2074 5,O41 ASF for 2015 5,035 collected for 2074 4,727 Under/(Over) Collection of 2014 ASF* 320 Under/{Over) Collection 320 Total ASF for 2015 5,355