BSP THE Bangko Sentral Ng Pilipinas - is the central monetary authority maintained by the state to function and operate

as an independent and accountable body corporate in the discharge of its mandated responsibilities concerning money, banking and credit. Basic Functions *Provides policy direction in the areas of money credit and banking *supervision over the operations of banks *excercise regulatory poers over the operations of finance companies and non bank financial institutions performing quasi banking functions *sole power authority to issue currency in the Philippines Regulate and Investigate *Foreign Exchange *redirections discounts loans and advances to banking and financial instituions *engage in open market operations *act as a banker for the government *marketing and stabilization of securities of government accounts *financial advisor of the government Nature of BSP *GOCC *Corporate Powers -adopt alter use a corporate seal - enter into contracts -lease or own real and personal property - sell and dispose real and personal property - sue and be sued - to perform any and all things that may be necessary or proper to carry out the purpose of the new central bank act. - to compromise, condone or release in whole or in part any claim of or settled liability *Supervision of Banks -nature of banking demands close superision - provided by law Except in cases wherein in regulations concerning rules imposed by the Securities and Exchange Commission. * Issuance of Regulations -rules and standards must have uniform application to all institutions or functions covered -they must take into consideration the distinctive character of the operations of institutions to which rules, modes or standards are to be applied - they must take ino consideration the substantive similarities of specific functions to which such rules, modes or standards are to be applied - must be in harmony with the provisions of the law *Procedural Due process - constitutionally required - but not necessarily required in the formulation and issuance of general rules and regulations *Bank Examination - determine current financial condition of the subject bank - asses banks future problems and ptentials - make sure bank is obeying applicablke laws and regulations - call the banks attention for improving safety and efficiency BSP is expressly authorized to conduct periodic or special examination of banks and quasi banks including their subsidiaries Subsidiary is a corporation more than fifty percent of the voting stock of which is owned by a bank or quasi bank. AFFILIATE IS A CORPORATION IN WHICH THE BANK OR QUASI BANK OWNS LESS THAN FIFTY PERCENT WHICH RELATED OR LINKED TO SUCH BANK OR QUASI BANK THROUGH COMMON STOCK HOLDERS OR SUCH OTHER FACTORS AS MAY BE DETERMINED BY THE MONETARY BOARD. types of examination Periodic Special Powers of Examiners - to administer oaths to any director, officer or employee - compel presentationj of all books and documents neccessary in their judgement to ascertain true condtion - right to be accorded full opportunity to examine books, cash and available assets and general condition of the institutions. -powers of examiners are subject to the law on secrecy of bank deposits and transactions, cannot inquire into specific banks deposits without consent, examiner is prohibited from revealing in any mannerexcept upon order of the court or conditions prescribed by the monetary board information relaying to the condition or business of any institution. Restraining /Injunction order is generally not allowed to prohibit the examination of BSP Except 1. BSP convincingly acted arbitrarily in bad faith 2. petitioner /plaintiff files with with the clerk or judge of the court in which the action in pending bond executed in favor of the BSP, in an amount fixed by court.

Overseeing Compliance -BSP may require banks to engage services of a independent auditor -Banks Quasi Banks and Trust Entities are required to submit a balance sheet audit -Compliance officer to see to it that the actions of the bank are consistent with banking laws and BSP regulations. -Reports are true and accurate accounts and records of their daily transactions. MONEY FUNCTION BSP sole power and authority to issue currency within the territory of the Philippines . No other person or entity, public or private, may put into circulation notes, coins or any other object or dicuent which in the opinion of the Monetary Board, might circulate as currency. Powers Regulations Investigate, arrest conduct searches and seizures Violation of such is punishable by imprisonment not less than 5 years but not more than 10 years. Coins as legal tender 1000 for denominations of 1 5 10 peso coins 100 for denominations of 1 5 10 25 sentimo coins Monetary Policy Altering of the economys money supply to stabilize aggregate output, employment and the price level. Increasing / Restricting TOOLS: Open market, Discount Policy and Reserve Requirements International reserves Abnormal Movements Money aggregates International reserves Banker and Financial Adviser of the Government Agent Financial Adviser Organization of the BSP Monetary Board 7 Members appointed by the president for a term of 6 years 4 shall constitute a quorum all decisions of the board needs at least 4 members 7 members are Governor of BSP as chairman Cabinet Members- 5 of which will come from the private sector. o 3 members for 6 years 2 for 3 years Qualifications Natural Born Citizens 35 years of age, Governor 40 years of age Good moral character, unquestionable integrity, known probity and patriotism. Disqualifications Removal of a Member Exercise of Authority issue rules and regulations direct management and operations and administration of BSP establish Human Resource Management System Tort Liability Governors and Deputy Governors of the BSP