The Bangko Sentral ng Pilipinas is granting regulatory relief measures to thrift, rural, and cooperative banks to enable them to assist and ease the financial burden of bank customers adversely affected by Typhoon ”Juan” which devastated parts of Luzon in October.
Eligible for the relief measures are those in the following areas identified by the National Disaster Risk Reduction and Management Council on 22 October 2010: Region I: Ilocos Norte, Ilocos Sur, La Union, and Pangasinan; Region II: Cagayan, Isabela, Nueva Vizcaya and Quirino; Region III: Aurora, Bataan, Bulacan, Nueva Ecija, Pampanga, Tarlac and Zambales; Region IV-A: Cavite and Rizal; Cordillera Administrative Region: Abra, Apayao, Benguet, Ifugao, Kalinga and Mt. Province; and National Capital Region: Manila.
Similar relief measures were extended by the BSP to thrift and rural/cooperative banks in provinces that were hit by previous typhoons such as Cosme, Frank, Ondoy and Pepeng.
As approved on 28 October 2010 by the Monetary Board, the BSP’s policy-making body, the temporary relief measures include:
1. Excluding existing loans of borrowers in affected areas from the computation of past due ratios provided these are restructured or given relief;
2. Reducing the 5 percent general loan loss provision to 1 percent for restructured loans of borrowers in the affected areas;
3. Non-imposition of penalties on legal reserve deficiencies with head office and/or branches in the affected areas;
4. Moratorium on monthly payments due to BSP for banks with ongoing rehabilitation programs;
5. Subject to BSP approval, booking of allowance for probable losses on a staggered basis over maximum of five (5) years for all types of credit extended to individual and businesses directly affected by typhoon/flooding;
6. Non-imposition of monetary penalties for delays in the submission of supervisory reports;
7. Allowing banks to provide financial assistance to their officers and employees who were affected by the calamity including those assistance that may not be within the scope of the existing BSP-approved Fringe Benefit Program;
8. Granting of a 60-day grace period to settle the outstanding rediscounting obligations as of 20 October 2010 with the BSP of all rediscounting banks in the affected areas; and
9. Allowing banks to restructure with the BSP, on a case-to-case basis, the outstanding rediscounted loans of borrowers affected by the calamity.
These measures will be in effect for a defined period and covered by additional specific and other prudential conditions.