Amendments to Pertinent Regulations on Rediscounting Availments, and Emergency Loans or Advances to Banking Institutions

Ba,Noxo SeNrneL No PrurprNAs OFFICE OF THE GOVERNOR ctRcutAR No.l,!Qs Series of 2018 Subject: Amendments to Pertinent Regulations on Rediscounting Availments, and Emergency Loans or Advances to Banking Institutions The Monetary Board, in its Resolution No. 818 dated 17 May 2OL8, approved the amendments to Subsections X269.2 andX272.6 of the Manual of Regulations for Banks to effect the removal of the P3.0 billion cap per bank on rediscountable National Food Authority papers and the acceptability of syndicated loans and loans with underlying real estate collaterals under Mortgage Trust Indentures for rediscounting and emergency loans. Section 1. Subsection X269.2 on Eligible papers and collaterals is hereby amended to read as follows: "EX269.2 Eligible pqpers and colloterols. xxx xxx a. Commerciol credits xxx xxx The outstanding National Food Authority papers that a bank can rediscount shaf l not exceed the rediscounting bank's SBL [twenty-five percent (25%l of its net worthl. xxx" Section 2. The following are hereby added after the last paragraph under Subsection X269.2: Syndicated loans may be accepted for rediscounting, subject to the following minimum requirements: a. The promissory note (PN) is negotiable; b. The master loan agreement allows the endorsement of the pN; and c. The opinion from the borrowing bank's counsel(s) that the master loan agreement allows the endorsement of the PN; that the PN is negotiable; and that no other act or approval is necessary to perfect the endorsement. Loans with underlying real estate collateral(s) under Mortgage Trust Indentures (MTl) may likewise be accepted, subject to the following minimum eligibility requ irements: SS'7 A. to;labir:i St., Malate 10*4 Manila, Pllilippinee. i63ti 7C3l7l.i 'www.bsp.1;*,:.pl) , hsprylail(d)lr\p-ir$v.r)ll

a. The trustee must be a bank or quasi-bank authorized by the Monetary Board to engage in trust and other fiduciary business; b. The borrowing bank must notify the trustee that it is assigning its participation to the Bangko Sentral by way of collateral; c. The borrowing bank must provide a certification specifying the following: current participations in the MTI; that there is no senior claim to that of the prospective claim of Bangko Sentral; and that it does not violate any existing loan agreement with other creditors; and d. The trustee must provide Bangko Sentral with a certified copy of the relevant collateral(s). Section 3. Subsection X272.6 on Acceptable collaterals and their corresponding loan values is hereby amended to read as follows: "8X272.6 Acceptoble collaterals and their corresponding loon values. xxx ACCEPTABLE With Surety With Surety With Negative No Surety COLLATERALS Agreement and Pledge but no Pledge but no Agreement and no Nesative Pledse Nesative Pledse Suretv Aqreement Nesative Pledee xxx xxx xxx xxx xxx Mortgage credits arising from syndicated loans and loans with underlying real estate collateral(s) under MTI shall likewise be assigned their applicable loan values based on the submission or non-submission of Surety Agreement and/or Negative Pledge as summarized in the immediately preceding table. Such loans shall be subject to the same minimum requirements under Subsection X269.2. Assets of stockholders xxx" Section 4. Effectivity. This Circular shall take effect fifteen (15) calendar days following its publication either in the Official Gazette or in a newspaper of general circulation. FOR THE MONETARY BOARD: .ffi,t 14 June 20L8 Page2 of 2