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Compliance Requirements for Banks in Philippines
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The Bangko Sentral ng Pilipinas (BSP) has formulated guidelines for establishing banks in the country, emphasizing core principles such as suitable shareholders, adequate financial strength, legal structure, and management expertise.
Application Process
To establish a bank, applicants must submit an application in triplicate to the Central Applications and Licensing Group (CALG). The original copy and duplicate copy should be submitted to CALG, while the third copy is retained by the organizers. Supporting documents required include:
- “Agreement to Organize a Bank” form
- Bio-data sheets of incorporators, proposed directors and officers
- Subscribers’ statement of assets and liabilities
- Income tax returns
- Other necessary clearance certificates
Capital Requirements
Banks must comply with minimum capital requirements as prescribed by the Monetary Board. The amounts vary depending on the type of bank:
- Universal banks: P4.95 billion
- Commercial banks: P2.40 billion
- Thrift banks: P1.00 billion to P500 million
- Rural banks: P100 million to P25 million
Incorporators and Subscribers
Incorporators and subscribers must be persons of integrity and good credit standing in the business community. Directors and officers should not possess any grounds for disqualification under existing BSP regulations. The number of incorporators, directors, and officers is limited to 5-15 individuals, with at least two-thirds of the board members being Filipino citizens.
Requirements for Issuance of Authority to Operate
Within 60 days from receipt of approval advice, organizers must submit:
- Articles of incorporation (seven copies)
- Treasurer’s sworn statement
- By-laws (seven copies)
They must also deposit initial paid-up capital with a commercial bank or any bank.
Other Requirements
Organizers must complete the following within specific timeframes:
- Construction and furnishing of the bank building: six months (for commercial banks and thrift banks), eight months (for rural banks)
- Recruitment and hiring of officers and employees
- Submission of documentary requirements at least 30 days before operation start
- Request for ocular inspection of the bank premises
Requirements after First Day of Operations
After the first day of operations, BSP should be informed about:
- Banking hours and days
- A statement of condition as of the first day of operation
Revocation of Authority to Establish a Bank
The authority to establish a bank will be automatically revoked if the bank is not organized and opened for business after receipt of notice of approval by the Monetary Board/Governor, within:
- Six months (for commercial and thrift banks)
- Eight months (for rural banks)
By following these guidelines, aspiring banks can ensure a smooth establishment process and compliance with BSP regulations.