Clarifications to Paragraph No. 1 of BSP Circular-Letter dated 5 September 1997

CIRCULAR LETTER Series of 1997

TO : All Banks

SUBJECT : Sale of FX to Residents by Forex Corporations

In response to inquiries and request for clarification from some banking quarters, Paragraph No. 1 of BSP Circular-Letter dated 5 September 1997, as clarified by BSP Circular-Letter dated 17 September 1997, is hereby further clarified with regard to captioned subject, as follows:

1. As a general rule, forex subsidiaries/affiliates of banks may sell foreign exchange to residents. However, they cannot sell foreign exchange to resident financial institutions other than Authorized Agent Banks of the BSP and bank-affiliated forex corporations.

2. Forex corporations are not subject to the documentary requirements of BSP Circular No. 138 dated 31 July 1997 on the sales of foreign exchange exceeding US$25,000.

GABRIEL C. SINGSON Governor