Additional Eligible Credit Instruments, Revised Loan Documents and Availment Procedures for the Bangko Sentral ng Pilipinas (BSP) Rediscount Facilities

Annex “A OFFICE OF THE GOVERNOR 2020-024 MEMORANDUM NO. 2020-__ To : All Concerned Banks Subject : Additional Eligible Credit Instruments, Revised Loan Documents and Availment Procedures for the Bangko Sentral ng Pilipinas (BSP) Rediscount Facilities The Monetary Board (MB), in its Resolution No. 500 dated 07 April 2020, approved the acceptance of the following credits for rediscounting to the BSP until 19 May 2020, subject to further extension as may be approved by the MB, as additional response in providing the needed liquidity to banks and to support and protect the enterprises and industries amidst the economic threat of the Corona Virus Disease 2019 (COVID-19) pandemic crisis in the Philippines pursuant to the relevant provisions of Republic Act (RA) No or the Ba anihan to Heal as One Act approved on 24 March 2020 and its Implementing Rules and Regulations (IRR): 1. Under E porters Dollar and Yen Rediscount Facilit EDYRF - United States Dollar (USD) and Japanese Yen (JPY)-denominated credit instruments related to the economic activities enumerated in Department of Trade and Industry (DTI) Memorandum Circular No. 20-08 dated 20 March 2020, except for loans to banks and capital markets; provided that, these credits are booked under the regular banking unit of the rediscounting bank and are compliant with the requirements on eligible papers and collaterals under Section 282 of the Manual of Regulations for Banks (MORB); provided further, that the said USD and JPY-denominated credits are only to those end-user borrowers (EUBs) operating during the enhanced community quarantine. 2. Under the Peso Rediscount Facility and EDYRF - Credit instruments compliant with the requirements on eligible papers and collaterals under Section 282 of the MORB, which were granted mandatory 30-day grace period pursuant to Memorandum No. 2020-017 dated 01 April 2020 and Section 4(aa) of RA No. 11469 and its IRR, subject to the submission of certification signed by the authorized officer/s of the bank stating that the maturities of said credit instruments were extended pursuant to RA No. 11469 and its IRR1. For rediscounting of credit instruments in Item No. 1 above, which may not be performed through the Electronic Rediscounting System, the application may be submitted to and processed by BSP - Department of Loans and Credit following the procedures set forth in Attachment

Moreover, Peso-denominated credit instruments related to economic activities allowed to operate by the DTI during the enhanced community quarantine of Luzon, except for loans to banks and capital markets, are allowed to be rediscounted under the Peso Rediscount Facility as long as these are compliant with the requirements on eligible papers and collaterals under Section 282 of the MORB. Furthermore, upon effectivity of this Memorandum, all rediscounting banks are required to submit the following for all subsequent availments under the BSP Peso Rediscount Facility and EDYRF: 1. Prior to drawdown a. Signed and notarized Supplemental Rediscounting Line Agreement1 Attachment hich contains among others an undertaking b the rediscounting banks to be submitted on or before the date set in the notice by the BSP; the consent of the EUBs to the possible endorsement or similar commercial transactions of their Promissory Notes (PNs) with the BSP; and provision that the rediscounting bank may be required by the BSP to submit government securities and/or other bank assets against which the BSP may enforce payment, in the event of default; and b. Certified true copy/ies of the PN between the bank and the EUB with endorsement2; 2. After release of the proceeds Promissory Note2 in favor of the BSP (Attachment 3 ; and 3. Upon notice by BSP - Certified true copy/ies of the consent of the EUBs to the possible endorsement or similar commercial transactions of their PNs with the BSP with the following stipulation, as referred to in 1.a above1: In he e en ha he PN f he b e i b e en l ind ed assigned, transferred, or otherwise becomes subject of a similar commercial transaction by the participating bank with another institution, the borrower automatically gives his/her/its consent thereto and fully understands and agrees that his/her/its PN and its underlying collaterals shall serve as security for the obligation of the participating bank with such other institution; that accordingly, the endorsee, holder, transferee, assignee, or other institution, shall be entitled to directly proceed against he b e nde hi n e c llec he a ici a ing bank bliga i n in accordance with such remedies as may be applicable under the law. 1 To be submitted following the procedures in Memorandum No. M-2020-016 dated 31 March 2020. 2 To be submitted following the procedures in Item No. 4 of Attachment 1 of this Memorandum.

This memorandum shall take effect immediately until subsequent notice of revocation from the BSP. For strict compliance. BENJAMIN E. DIOKNO Governor Atts.: A/S 8 April 2020 Subject: Additional Eligible Credit Instruments, Revised Loan Documents and Availment Procedures for the Bangko Sentral ng Pilipinas (BSP) Rediscount Facilities

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