Mandatory allocation of credit resources to small and medium enterprises (SMEs)

Bor ertaat a Piininas

OFFICE OF THE DEPUTY GOVERNOR SUPERVISION AND EXAMINATION SECTOR

CIRCULAR LETTER NO. CL-2007- 039

To ALL BANKS

Subject: Mandatory allocation of credit resources to small and

medium enterprises (SMEs)

BSP Circular No. 147 dated 24 October 1997, which implements the provisions of Section 13 of Republic Act (RA) No. 6977, as amended provides that the mandatory credit allocation for SMEs will expire on 9 August

Council (SMED Council), which is the primary government agency responsible for the promotion, growth and development of SMEs, approved a ievel of exposure to SMEs until the mandatory allocation provision of the Magna Carta for Small Enterprises is reinforced with the passage of the resolution requesting that "the local banking community to maintain its present proposed amendments to RA 6977 (as amended by RA 8289) in Congress" 2oo7. In view thereof, the Small and Medium Enterprise Development

Attached, for information and guidance, is a copy of SMED Council Resolution No. 4, Series of 2007

NeStoR a. Deputy Governor ESPENiL

gust 2007

Att: AS

PananaLaPIng MAtataG, BanSang PanatAg

A. Mabini St., Malate 1004, Manila, Philippines Trunkline (632) 524-70-11 URL:www.bsp.aoy.ph * e-mail: [email protected]

SMED Council Resolution No. 4

Series of 2007

"Requesting the tocal banking community to maintain their present level of exposure Enterprises is reinforced with the passage of the proposed amendments to RA 6977 to SMEs until the mandatory allocation provision of the Magna Carta for Small (as amended by RA 8289) in Congress"

Smail Enterprises", as amended by RA 8289, "An Act to Strengthen the Promotion and for SMEs; development of small and medium enterprises (SMEs) in the country by way of of SMEs, including assisting relevant agencies in the tapping of local and foreign finds Development of, and Assistance to Small and Medium Scale Enterprises", mandates the SMED Council to be the primary agency responsible for the promotion, growth and facilitating and closely coordinating national efforts to promote the viability and growth WHEREAS, pursuant to RA 6977, otherwise known as the "Magna Carta for

lending institutions as defined under Bangko Sentral ng Pilipinas rules, whether public or private, are mandated to set aside at least six percent (6%) and at least two percent (2%) for small and medium enterprises, respectively, of their total loan portfolio and make it available for SMEs credit for a period of ten (10) years from the date of the effectivity of the Act: WHEREAS, under Section 13 of the Magna Carta for Small Enterprises, all

year period will commence on August 12, 1997 and end on August 9, 2007: WHEREAS, under Section 2 a) of BSP Circular No. 147 Series of 1997, the ten-

agreed to request the local banking community to maintain their present level of exposure to SMEs until the mandatory aliocation provision of the Magna Carta for Small Enterprises is reinforced with the passage of the proposed amendments to RA 6977 (as amended by RA 8289) in Congress; WHEREAS, in the 110" SMED Council meeting held on 04 July 2007, the body

to SMEs until the mandatory allocation provision of the Magna Caria for Small Enterprises is reinforced with the passage of the proposed amendments to R4 6977 (as amended by RA 8289) in Congress. Council requests the local hanking community to maintain their present level of exposure NOW, THEREFORE, be it resolved, as it is hereby resolved that the SMED

Approved, 04 July 2007.

For th. MED Councilj

FRAN SCO R. FLORO Vice-Chairman