Beruflich Dokumente
Kultur Dokumente
OLONGAPO CITY
S.Y. 2017-2018
SUBMITTED BY:
SUBMITTED TO:
One of the consequences of the nature of the bank’s business is that it is required to exercise
utmost diligence in the handling of deposits. The Supreme Court explained in Simex International
(Manila) Incorporated v. Court of Appeals that:
“The Banking System is an indispensable institution in the modern world and place a
vital role in the economic life of every civilized nation. Whether as mere passive entities for
the safekeeping and saving of man or as active instruments of business and commerce, banks
have become a ubiquitous presence among the people, who have come to regard them with
respect and even gratitude and, most of all, confidence. Thus, even the humble wage-earner
has not hesitated to entrust his life’s savings to the bank of his choice, knowing that they will
be safe in its custody and will even earn some interest for him. The ordinary person, with
equal faith usually maintains a modest checking account for security and convenience in the
settling of his monthly bills and the payment of ordinary expenses. As for business entities like
the petitioner, the bank is a trusted and active associate that can help in the running of their
affairs, not only in the form of loans when needed but more often in the conduct of their day-
to-day transaction like the issuance or encashment of checks.”
2. Commercial Banks (CB) – banks that have, in addition to the general powers
incident to corporations, all such powers as may be necessary to carry on the
business of commercial banking. (Sec. 29)
Example:
5. Cooperative Banks – banks that primarily provide financial, banking and credit
services to cooperative organizations and their members. (Sec. 100, R.A. 6938
as amended by R.A. 9520)
Example:
As to Purpose
UNIVERSAL COMMERCIAL THRIFT BANK RURAL COOPERATIVE ISLAMIC
BANK BANK BANK BANK BANK
Universal and Commercial banks a.) Recognize Rural banks Cooperative The primary
are financial institutions that the are banks are purpose of
provide services for bothsavers indispensable organized to organized an Islamic
and borrowers. Their role in the role of the promote primarily to Bank is to
financial system is critical to private sector, to comprehens provide financial promote and
keeping money available and encourage ive rural and credit services accelerate
liquid. private developmen to Cooperatives. the socio-
enterprise, and t with the economic
to provide end in view developmen
incentives to of attaining t of the
needed a more Autonomou
investments; equitable s Region by
(b) Promote distribution performing
economic banking,
development financing
pursuant to the and
socioeconomic investment
program of the operations
government and to
(c) Encourage establish
and assist the and
establishment of participate
thrift bank in
system; agricultural,
(d) Encourage commercial
industry, and
frugality and the industrial
accumulation of ventures
savings among based on
the public, and Islamic
the members and concept of
stockholders of banking.
thrift banks
As to Power
UNIVERSAL COMMERCIAL THRIFT RURAL COOPERATIV ISLAMIC
BANK BANK BANK BANK E BANK BANK
The powers of
an investment
house
as provided in
existing laws;
and The power
to invest in
non-allied
enterprises as
provided in the
GBL. (Sec. 23)
The general powers incident to corporations,
Accept and issue drafts and letters of credit Accept and
issue drafts
and letters of
credit.
Accepting and creating demand
deposits.
Discounting and negotiating promissory notes, drafts, bills of exchange, and other
evidences of debt
To invest in
equities of
specified
allied
undertakings.
Receiving other types of deposits and deposit substitutes.
Invest in readily marketable bonds and other debt
securities, commercial papers and accounts
receivable, drafts, bills of exchange, acceptances
or notes arising out of commercial transactions.
Extend credit
facilities to
private and
government
employees.
Receive in custody funds, documents and valuable objects.
Purchase, hold and convey real estate.
a) Receive in custody funds, documents and valuable objects; Handle
b) Act as financial agent and buy and sell, by order of and for the account of storage
their customers, shares, evidences of indebtedness and all types of operations for
securities; goods or
c) Make collections and payments for the account of others and perform such commodity
other services for their customers as are not incompatible with banking financing
business; secured by
d) Upon prior approval of the Monetary Board, act as managing agent, warehouse
adviser, consultant or administrator of investment receipts
management/advisory/consultancy accounts; and presented to
e) Rent out safety deposit boxes. the bank
Engage in trust, quasi-banking functions and
money market operations.
Grant loans,
whether
secured or
unsecured.
Extend credit against the security of jewelry,
precious stones and articles of similar nature,
subject to such rules and regulations as the
Monetary Board may prescribe.
Accept foreign currency deposits
They also offers checking account Open current Open current or checking Open current
services to their customers. or checking accounts provided that the net or checking
accounts assets is not less than 5M accounts.
provided that
the net assets
is not less
than 20M
Act as correspondent of other financial institutions.
It may also Act as collection agent for government Act as
collect taxes, entities, including but not limited to, the collection
custom duties Bureau of Internal Revenue (BIR), Social agent insofar
and other Security System (SSS) and the Bureau of as the
government Customs (BOC). payment
levies as a form orders, bills
of assistance to of exchange
Bureau of or other
Internal commercial
Revenue (BIR) documents
and Bureau of are exclusive
Customs (BOC). of riba or
interest
prohibitions.
Act as official depository of national agencies and of
municipal, city or provincial funds in the municipality, city or
province where it is located.
Issue
mortgage and
chattel
mortgage
certificates,
buy and sell
them for its
own account
or for the
account of
others, or
accept and
receive them
in payment or
as
amortization
of its loan
Extend loans and advances
primarily for the purpose of
meeting the normal credit
needs of farmers, fishermen
or farm families as well as
cooperatives, merchants,
private and public employees.
Accept negotiable order of
withdrawal (NOW) accounts.
Sell domestic drafts
Invest in allied undertakings
Open savings
accounts for
safekeeping
or custody
with no
participation
in profit and
losses except
unless
otherwise
authorized by
the account
holders to be
invested
Accept
investment
account
placements
and invest the
same for a
term with the
IB’s funds in
Islamically
permissible
transactions
on
participation
basis
Buy and sell Foreign Exchange
Provide
financing
with or
without
collateral by
way of
leasing, sale
and
leaseback, or
cost plus
profit sales
arrangement
Issue shares
for the
account of
institutions
and
companies
assisted by
the bank in
meeting
subscription
calls or
augmenting
their capital
and/or fund
requirements
as may be
allowed by
law
Undertake
various
investments
in all
transactions
allowed by
the Islamic
Shari’a in
such a way
that shall not
permit the
haram
(forbidden),
nor forbid the
halal
(permissible)
Issue
investment
participation
certificates,
muquaradah
(non-interest
bearing
bonds),
debentures,
collaterals
and/ or the
renewal and
refinancing
of the same,
with the
approval of
the Monetary
Board to be
used by the
IB in its
financing
operations for
projects that
will promote
the economic
development
primarily of
the
Autonomous
Region
Carry out
financing and
joint
investment
operations by
way of
mudarabah
purchasing
for others on
a cost-plus
financing
arrangement,
and invest
funds directly
in various
projects or
through the
use of funds
whose
owners desire
to invest
jointly with
other
resources
available to
the IB on a
joint
mudarabah
basis;
As to Equity Investments
UNIVERSAL COMMERCIAL THRIFT RURAL COOPERATIVE ISLAMIC
BANK BANK BANK BANK BANK BANK
A UB may invest A CB may Thrift banks, Rural banks and Islamic banks
in the equities of invest only in Cooperative Banks may invest in equities may invest in
allied (either the equities of of allied undertakings as hereinafter the equities
financial or non- allied enumerated: Provided, That: of allied
financial) and non- enterprises (a) the total investments in equities undertakings.
allied enterprises. (either financial shall not exceed twenty-five
Except as the MB or non- percent (25%) of the net worth of
may otherwise financial).(sec.3 the bank;
prescribe: 0) (b) the equity investment in any
the total investment Except as the single enterprise shall be limited
in equities of allied mb may to fifteen percent (15%) of the net
and non-allied otherwise worth of the bank;
enterprises shall Prescribe: (c) the equity investment in any
not exceed 50% of the total single enterprise shall remain a
the net worth; and investment in minority holding in that
the equity equities of allied enterprise; and
investment in any enterprises shall (d) the equity investment in other
one enterprise, not exceed 35% banks shall be subject to the same
whether allied or of the net worth provisions governing similar
non-allied, shall of the bank; and investments of commercial banks
not exceed 25% of the equity and shall be deducted from the
the net worth of the investment in investing bank's net worth for the
bank (sec. 24). any one purpose of computing of the
enterprise shall prescribed ratio as provided in
not exceed 25% Section 9 hereof: Provided,
of the net worth further, That equity investments
of the bank. shall not be permitted in non-
related activities. Where the allied
activity is a wholly- or majority-
owned subsidiary of the thrift
bank, the Bangko Sentral may
subject it to examination.
V. SUPERVISORY POWERS
• The issuance of rules of conduct or the establishment of standards of operation for
uniform application to all institutions or function covered taking into consideration the
distinctive character of the operations of institutions and the substantive similarities of
specific functions to which such rules, modes or standards are to be applied.
• The conduct of examination to determine compliance with laws and regulations if
the circumstances so warrant as determined by the Monetary Board.
• Overseeing to ascertain that laws and regulations are complied with.
• The regular investigation which shall not be oftener than once a year from the last
date of examination to determine whether as institution is conducting its business on a safe
or sound basis; provided that the deficiencies of irregularities found by or discovered by
an audit shall be immediately addressed.
• Inquiring into the solvency and liquidity of the institution.
• Enforcing prompt corrective actions.
VI. POLICY DIRECTIONS, RATIOS, CEILINGS AND LIMITATIONS
The Bangko Sentral shall provide policy direction in the areas of money, banking
and credit.
For this purpose, the Monetary Board may prescribe ratios, ceilings, limitations, or
other forms of regulation on the different types of accounts and practices of banks and
quasi-banks which shall, to the extent feasible, conform to internationally accepted
standards, including those of the Bank for International Settlements (BIS).
VII. AUTHORITY TO ENGAGE IN BANKING AND QUASI- BANKING
FUNCTIONS
No person or entity shall engage in banking operations or quasi-banking functions
without authority from the Bangko Sentral: Provided, however, That an entity
authorized by the Bangko Sentral to perform universal or commercial banking
functions shall likewise have the authority to engage in quasi-banking functions.
According to Atty. Rafael Morales, in his book “The Philippine General Banking
Law (Annotated)” , He maintains that it is inappropriate to apply the term "quasi-banking"
to the alternative borrowing operations (i.e. borrowing from the public through means other
than deposits) of banks themselves. He suggests that such activity be simply termed
"deposit-substitute operation" since, to quote him, "there is nothing ‘quasi’ about it, when
it is performed by banks themselves." (Presidential Decree No. 71, Section 2-D b).