Collection of the Annual Supervisory Fees (ASF) for the Year 2019

Bnrtexo SenrRaL Ncl PtutprNAs OFFICE OF THE DEPUTY GOVERNOR FINANCIAT SUPERVISION SECTOR MEMORANDUM NO. M.2019. OO9 TO : ALL BANKS AND NON-BANKS WITH QUASI-BANKING FUNCTIONS (NBQBsl Subject : Collection of the Annual Supervisory Fees (ASF) for the Year 2019 Pursuant to Section 1101 and Subsection 4901Q.1 (2008 - 4652Q) of the Manual of Regulations for Banks (MORB) and the Manual of Regulations for Non- Bank Financial Institutions (MORNBFI), respectively, the following guidelines shall govern the computation and collection by the Bangko Sentral Ng Pilipinas (BSP) and the payment by Banks and NBQBs ofthe 2019 ASF. L. Computation of ASF for 2019 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 U niversal/Com mercial Banks I/28 of L% Thrift Banks L/28 of LTo Rural/Cooperative Banks L/4O of L% NBQBs t/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 regu lations. ln view of the amendments to Republic Act (R.A.) No. 765i2, which took effect on 06 Morch 201-9, the ASF computation for Large Taxpayers sholl be gross of Creditoble Withholding Tox (CWT). Please refer to Section 4 of this Memorandum for guidelines. r Financial Reporting Package (FRP) for banks, Consolidated Statement of Condition (CSOC) for NBQBs, and FRP for Trust Institution (FRPTI) of banks and NBQBs with trust functions 2 Amended by R.A. No. 11211 (An Act Amending R.A. No. 7653 Otherwise Known as "The New Central Bank Act", and for Other Purposes)

ln 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 newlyformed institution shall be considered in determiningthe AAA. ln case of upgrading or downgrading, the assets from one bank category to another shall likewise be considered in determining the AAA. The collection of the 20L9 ASF shall take into consideration events subsequent to the collection of the 2018 ASF that would warrant a recomputation. In such cases, the resulting over or under-payment of the 2018 ASF shall be deducted/added to the 2019 ASF. Sample computations to illustrate potential scenarios are provided in Annex A. 2. Notification of Amount Due for 2019 and Mode of Payment The BSP Supervisory Data Center (SDC) shall send a billing notice in April 2019 to the Bank/NBQB for its ASF payment indicating, among others, the computation of the ASF due, 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/NBQBs, 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 deficiency, the provisions on DDA deficiency in Section 1101 and Subsection 4901Q.1 (2008 - 4652Q) of the MORB and MORNBFI, respectively, as amended, shallapply. 3. Exceptions Noted on Billing Notice of 2019 ASF Upon receipt of the BSP Notice of ASF billing, a Bank/NBQB is encouraged to check the accuracy of the billing and to submit any noted exceptions therein not later than ten (10) working 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 Officer-ln-Charge Supervisory Data Center (SDC) Bangko Sentral Ng Pilipinas 11th Floor, Multi-storey Building BSP Complex, A. MabiniStreet, Malate 1004 Manila

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 im mediately succeeding year. 4. Creditable Withholding Tax (CWTI on 2019 Supervisory Fees ln accordance with the amendments to R.A. No. 7653, the Bangko Sentral shall be exempt from all national, provincial, municipal and city taxes on income derived from its governmental functions which include income from its activities or transactions in the exercise of its supervision over the operations of banks and its regulatory and examination powers over non-bank financial institutions performing quasi-banking functions, money service businesses, credit granting businesses and payment systems operators. A Bank/NBQB withholding a portion of the ASF on account of Subsections M and N of Section 2.57.2 of Bureau of Internal Revenue (BlR) Revenue Regulations (R.R.) No. 2-98, shall advise the BSP through written representation, within ten (10) working days before the specified date of collection/debit to DDA as indicated in the billing notice, of such intention together with the BIR Form No. 2307 indicating the amount withheld as CWT. Advance scanned copies in Portable Document Format (PDF) of the said representation and BIR Form should be submitted to the BSP official e-mail address3. Moreover, the following shall apply to Banks/NBQBs with written representation and BIR Form No. 2307 submitted within the abovementioned prescribed period: 4.L The ASF, net of the CWT, shall be debited from their respective DDAs on the specified date referred to in the notice of ASF billing under Section 2 above. 4.2 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. The BIR Form No. 2307 shall accurately indicate, among others, the following details: 4.2.L Payee: Bangko Sentral ng Pilipinas 4.2.2 Tax ldentification Number: 000-354-790-000 4.2.3 Address: A. MabiniSt. corner P. Ocampo Sr. St., Malate, Manila 3 For Banks and NBQBs, [email protected] and [email protected], respectively.

4.2.4 Zip Code: 1004 4.2.5 The BIR-registered name of the payor-bank/- NBQB, as exactly indicated in the BIR Certificate of Registration (BlR Form No.2303)of the Bank/NBQB. 4.2.6 the amount of income payment pertaining to the gross ASF 4.2.7 the tax withheld 4.2.8 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/NBQBs have other transactions with BSP, a separate BIR Form No. 2307 for the transaction/s shall be provided to BSP. 4.3 In case of failure of concerned Bank/NBQB 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 CWT from the DDA of Banks/NBQBs concerned, with no obligation on the part of the BSP to reimburse said amount. In case of DDA deficiency, the provisions in Section 1101 and Subsection 4901Q.1. (2008 - 4652Q) of the MORB and MORNBFI, respectively, as amended, shall apply. This Memorandum shalltake effect immediately. For strict compliance. ESTJTUTO C. CRU Sector-ln-Charg 3 April2oLg

:' Arrnex A. |,. Scenarios for computation of 2019 Annual Supervisorv Fee (ASF) 1. Upgrade/Downgrade from one bank category to another kenario A: RB A upgraded toTB A in lanuaru 2079 Scenorio 8: TB B downgraded to RB B in tonuarv 2OI9 The 2018 Average Assessable Assets (AAA) of RB A The 2018 AAA of TB B will be multiplied by the will be multiplied by the TB rate. RB rate. 2018 Net Assessable Assets 2018 Net Assessable Assets Jan 242,849,367.74 Feb 242,337,276.23 24\,288,L39.49 Mar 241,288,L39.49 lMar loot Apr 240,666,674.79 lMav May 241,300,200.39 240,8r3,284.40 240,8L3,284.40 lJul 238,639,584.ls I lo" sep lo" 236,s34,588.97 236,637,077.94 sep 236,63L,O77.94 Oct Oct 232,860,322.ss Nov Nov 229,900,793.89 Dec 229,t55,336.56 Dec 229,155,335.56 Sum of Net Assessable Assets 947,887,838.39 Sum of Net Assessable Assets 2,852,976,646.50 No.of reporting periods 4 No.of reporting periods 72 Average Assessable Assets 236,971,959.60 Average Assessable Assets 237,748,053.89 ASF rate for TB (l/28 of l%l 0.000357143 ASF rate for RB (U4A of t%l 0.0002s ASF for 2019 for TB A 84,632.88 ASF for 2019 for RB B 59,437.OL

" J ScenarieC: RB A upgraded toTB A in November 20IB TB A will be charged the applicable rate for the equivalent number of months as RBfiB in 2018. The difference in the amount collected as 2018 ASF will be added as an adjustment to the 2019 ASF. Computation of 2019 ASF 2018 ASF (Bosed on 2077 Net Assessoble Assets) ASF actuol Recomputotion collection for 2078 2018 Net Assessable Assets AsRBA AsRBA AsTBA Totol Jan feb 247,288,739.49 Feb lMar Mar loP' 232,860,323 Moy Jun 240,813,284.40 ay tul n 238,639,584 Aug Jul sep 236,637,077.94 Oct 242,337,276 Nov Dec 229,155,336.56 Nov 254,991,835 Sum of Net Assessoble Assets 947,887,838.39 947,887,838.39 947,887,838.39 Dec 267,74L,427 Average Assesso ble Assets 236,971,959.60 236,977,959.60 236,977,959.60 No.of reporting periods 4 70 2 Sum of Net Assessable Assets 1,236,570,445.70 Proroted No. of months os RB/TB 10/12 2/12 No. of reporting periods 5 Proroted Averoge Assessoble Assets 197,476,633.00 i9,495,326.60 age Assessable Assets 247,374,099.L4 Applicoble ASF Rotes 0.000250 0.00025 0.000357143 rate for TB (I/28 of 7%) 0.0003s7143 ASF octuol collection for 2018 59,242.99 for 2019 88,325.50 2018 ASF Recomputotion (RB A + TB A) 49,369.16 14,105.48 63,474.64 Under/(Over) Collection of 2018 ASF* 4,237.65 Less: ASF actuol collection for 2078 s9,242.99 Total ASF for 20t9 5s8.14 Under/(Over) Collection of 2018 ASF* 4,237.65

fl : . Scenorio D: TB A downgraded to RB A in November 20lg .ir ''iI RB A will be charged the applicable rate for the equivalent number of months as TB/RB in 2018. The difference for the amount collected as 2018 ASF will be added as an adjustment to the 2019 ASF. Computation of 2019 ASF 2018 ASF (&osed on 2077 Net Assessable Assets) ASF actuol collection fol Recomputation 2018 2018 Net Assessable AsTBA AsTBA AsRBA Totol Assets lon 242,849,367.14 Jan 233,738,443 Feb 242,337,275.23 238,4L3,212 241,288,139.49 Mar 243,18L,476 240,666,674.79 Apr loP' 248,045,106 241,300,200.39 May 253,005,008 l'ov Jun 240,813,284.40 Jun 258,066,128 Jul 238,639,584.15 Jul 263,227,451 Aug 236,534,588.97 268,492,000 sep 235,631,077.94 5ep 2t3,86L,840 Oct 232,860,322.55 279,339,077 Nov 229,900,793.89 Dec 229,155,335.55 206,910,7t5 Sum of Net Assessoble Assets 2,852,975,646.50 2,852,976,646.50 2,852,976,546.50 Average Assessable Assets 237,748,053.88 237,748,053.88 237,748,053.88 Sum of Net Assessable Assets 2,756,28L,455.45 N o. of reporting periods 12 10 2 No. of reporting periods 11 Proroted No. of months as TB/RB 10/12 2/12 age Assessable Assets 25L,480,132.31 Prorated Average Assessoble Assets 198,123,378.23 39,624,675.65 rate for RB (LI O of l%l 0.0002 Applicable ASF Rates 0.000357143 0.00035714i 0.00025 ASF for 2019 52,870.03 2078 ASF Recomputotion (TB A + RB A) 70,758.38 9,906.17 80,554.55 Under/(Over) Collection of 2018 ASF* 245.57 Less: ASF actual collection for 2018 84,910.05 84,910.05 Total ASF tor 2OL9 4.s3 Under/(Over) Collection of 2018 ASF* (4,24s.sL\

i.- 2.'Consolidation: Two or more entities combine to form a new single entity. The originat entities cease operations after ,.1 l,rl, the new entity started its operations. Scenorio E: RB C ond TB C consolidoted in lanuary 2019 to lorm a new TB D. Since the consolidation was effected prior to the assessment for 2OL9 ASF, the 2018 Net Assessable Assets of the two banks will be combined and the TB rate will be applied. 2018 Net Assessable Assets RBC TBC TBD t64,658,792.00 163,851,844.80 21,928,504.00 L65,3LL,225.60 loP,. 153,357,155.20 l"tY L54,30L,374.40 lJun 22,295,t42.L5 168,488,963.20 lJul L70,373,352.00 Aug L70,278,228.80 sep 22,320,467.05 t68,700,764.00 Oct L68,L86,770.40 Nov 177,7L0,888.80 Dec 22,383,649.40 192,866,280.80 88,927,76L.60 2,018,095,640.00 No. of reporting periods 4 L2 Average Assessable Assets 22,23t,940.40 L68,L74,636.67 Total Average Assessable Assets ofTB D L90,406,577.07 ASF rate forTB (L/28 of L%l 0.000357143 ASF for 2019 for TB D 68,002.38

' Scenoria F: RB X and TB Y consolidoted in November 20lB to form o new TB Z. .. , ;' ,,'TB Z will be charged the applicable rate as TB in 201g. The difference in the amount collected as 2018 ASF will be added as an adjustment to the 2019 AsF Computation of 2019 ASF 2018 Net Assessable Assets 2018 ASF (Bosed on 2077 Net Assessoble Assets) RBX TBY T8Z TOTAL ASF octuol collection fot 2078 RBX TBY lJan 10,654,803,689.10 9,322,953,227.96 lJon lFeb 70,682,4/.5,949-12 lFeb 9,347,1/t0,205./t8 Mar 63,359,057.35 LO,918,572,747.48 I 55,/U7,925.18 9,553,751,148.80 Apr lMor tL,184,687,926.88 9,786,501,936.02 May IAP' L7,466,349,247.26 Moy 10,033,0ss,s86.10 JUn 74,579,372.57 LL,404,472,742.45 Jun 65,255,898.50 9,978,913,649.65 Jul 11,195,888,229.99 Jul 9,796,/n2,201.24 Aug L7,253,628,84I.32 Auo 9,846,925,235.33 sep 77,663,914.9r t2,658,546,529.99 sep 67,955,925.55 11,076,228,213.74 Oct 72,774,239,768.38 od 11,124,959,797.34 Nov 12,96r,410,549.24 Nov 11,341,234,230.58 Dec 13,237.637.600.40 Dec 77,891,985.28 11.s82.932.900.3s Sum of Net Assessable Assets 275,572,284.83 114,133,635,550.18 26,199,O48,749.63 Sum ol Net Assessoble Assets 265,552,734.50 122,791,098,333.59 No. of reporting periods 1 1C 2 No.of re porting periods 4 12 Average Assessable Assets 7r,870,757.67 11,413,363,566.02 L3,O99,524,074.82 Ave roge As se sso b le Assets 66.638.183.63 10.232.591.527.80 Pro-rated no. of months to/72 101L2 2/12 Applicoble ASF Rotes 0.0@250 0.0Ni57143 Pro-rated Average Assessable Assets 59,892,301.34 9,511,136,305.01 2,t83,254,O12.47 ASF octuol collection lor 2078 16,659.55 3,654,498./U Total Average Assessable Assets of TB Z 17,754,282,618.83 Recomputotion of 2018 ASF: ASF rate for TB (7/28 of 7%l 0.000357143 Pro-rated no. of months os RB 1n/1 2 ASF for 2019 of TB Z 4,797,959.76 Pro-roted 2018 ASF os RB 13,882.95 Under/(Over) Collection of 2018 ASF* t.r89.97 Total ASF for 2019 4,r99,749.73 Averoge Assessoble Assets of RB X 66,638,183.53 TB Rote 0.000357143 2018 ASF os TB 23,799.36 Pro-roted no. of months os TB 2/12 Pro+oted 2018 ASF os TB 3,966.s6 Totol pro+oted 2078 ASF 17,849.52 Totol Recomputed 2018 ASF 3,672,347.95 Less: ASF collected for 2018 (RB X + TB Y) 3,671,157.98 Under/(Over) Colledion of 2018 ASF, 1,189.97

.'. . .: , ' :. 3.l,Mergerl One entity absorbs another entlty and contlnue to opente as the survlvlng entitywhtle the absorbed en ty ceases to operate Scena o c: RB D qndfB E meryed in lonuaN ZOtg dth fB E as the suMiving enttty The quarterly 2018 Net Assessable Assets of RB D will be combined with the monthly 2018 Net Assesable Assets of TB E and the TB rate will be applied. 2018 Net Assessable Assets RBD TBE Total ljan L54,367,6L7.50 reb L53,620,479.50 I 23,2L8,4t6.0O 754,979,274,OO lMar L43,772,333.OO loPt lMay 144,657,539.50 llrn 23,606,62L.LO 157,959,403.00 Jul 159,725,017.50 Aug 159,635,939.50 sep 23,633,435.70 158,156,966.25 Oct L57,675,097.25 Nov 173,442,606.99 Dec 23,700,333.60 187,318,015.53 Sum of Net Assessable Assets 94,158,g06.40 1,905,309,199.51 No. of reporting periods 4 L2 Average Assessable Assets 23,539,707.60 L58,775,765,7L Total Average Assessable Assets ofTB E L82,315,467.3L ASF rate for TB (L/28 ot L%l 0.0003s7143 ASF for 2019 for TB E 65,LL2.69

' gcenaria H: RB A and rB A merged in December 2018 with rB A os the surviving enttty ',.,';" ,,,,'TB A will be charged the applicable rate as TB in 2018. The difference for the amount collected as 2018 ASF will be added as an adjustment to the 2019 ASF. Computation of 2019 ASF 2018 ASF I 2018 Net Assessable fusets (Bosed on 2077 Net Assessoble Assets) I I R8A TBA Mersed TB A TOTAL ASF Collected for 2018 I I RBA TBA lJan Lr,320,728,920 lon 9,988,878,458.53 Feb 11,350,098,821 Feb 10,014,793,077.30 Mar 67,329,623.44 11,600,983,538 Mor 59,408,491.27 10,236,161,945.14 Apr 7t,883,730,922 Apr 70,485,6/U,931.45 May 72,782,996,069 Moy 10,749,702,413.68 JUn 79,240,579.60 L2,177,252,289 lun 69,918,105.53 10,691,693,195.05 Jul rr,89s,63r,244 lul 10,496,145,215.62 Aug 7t,956,980,644 Aug 10,550,277,038,92 5ep 82,517,909.59 13,449,705,688 sep 72,809,920.23 11,867,387,371.87 Oct 13,508,879,754 Oct 11,919,599,782.86 Nov 13,77t,498,709 Nov 12,151,322,389.91 Dec 14,064,989,950 Dec 83,455,698.s1 12,410,285,250.37 Sum of Net Assessable Assets 229,088,052.63 135,038,486,597.51 14,064,989,950.42 Sum of Net Assessoble Assets 285,592,215.54 131,561,891,071.70 No. of reporting periods 3 11 1 No.of reporting periods 4 12 Average Assessable fusets 76,362,684.21 72,276,226,O54.32 14,064,989,95O.42 Ave ro g e Asse sso bl e Assets 71,398,053.89 10,963,4fi,922.64 Pro-rated no. of months 17/12 t7t72 L/L' Applicoble ASF Rotes 0.00025 0.000357143 Pro-rated Average Assessable Assets 69,999,727.79 1r,2s3,207,276.45 7,772,O82,495.87 Originol2018 ASF 17,849.51 3,915,534.04 Total Average Assessable Assets of TB A L2,495,288,839.s2 Recomputotion of 2078 ASF: AsF rate for T8 (1/28 ot t%l 0.000357143 Prc-roted no. of months os RB 11/12 ASF for 2019 4,462,604.94 Pro-roted 2078 ASF os RB 16,362.0s Under/(Over) Collection of 2018 ASF. 637.49 rotal ASF for 2019 4,463,242.44 Averoge Assessoble Assets of RB A 71,398,053.89 TB Rote 0.000357143 2018 ASF as TB 25,499.32 Pro-roted no. of months os TB 1/12 Pro-roted 2018 ASF os TB 2,124.94 Total pro-rated 2018 ASF 18.487.00 Total RecomDuted 2018 ASF 3,934,O27.O4 Less: ASF collected for 2018 (RB A+ TB A) 3,933,383.55 Under/(Over) Collection of 2018 ASF* 637.49

t : 4.1 Amendment of reports used in the computation of ASF ' Scenario I: RB E amended its Dec 2017 FRp in lonuaru 2019 The 2018 ASF will be recomputed and the resulting under/(over) collection will be added to/deducted from the 2019 ASF. Computation of 2019 ASF Recomputation of 2078 ASF 2018 Net Assessable Assets 2017 Net Assessoble Asssets RBE RBE Original Amended lan Feb Feb Mar L9,864,644.80 Mor 78,522,548.05 78,522,548.05 May un 20,796,775.83 19,605,793.75 19,605,793.15 Aug sep 20,2L9,7t7.27 20,644,771.95 20,644,777.95 Oct Nov Dec 20,276,952.08 Dec 27,484,407.05 27,883,458.27 Sum of Net Assessoble Assets 80,257,520.20 80,656,577.42 of Net Assessable Assets 80,s58,089.92 No. of reporting periods 4 of reporting periods vero ge Assessoble Assets 20,064,380.05 20,764,142.85 Average Assessable Assets 20,139,522.48 rate for RB Q/ao of 1%) 0.00025 ASF rate for RB (l/4O ol 7%) 0.0002 ASF for 2018 5,047.04 ASF for 2019 5,034.88 Less: ASF collected for 2078 5,076.10 Under/(Over) Collection of 2018 ASF* 24.94 Under/(Over) Collection of 2018 ASF* 24.94 otal ASF for 2079 5,0s9.82