PART THREE. FINANCIAL ACCOUNT TRANSACTIONS
Chapter I
LOANS AND GUARANTEES

Section 24. Private Sector Loans/Borrowings –

1. Prior BSP approval shall be obtained for publicly-guaranteed private sector foreign/foreign currency loans/borrowings, including issuances of the following:

   1. FX-denominated bonds/notes/other debt instruments, whether to be issued onshore or offshore; and

   2. Peso-denominated bonds/notes/other debt instruments issued offshore, whether to be settled in foreign or local currency.

   The loans/borrowings shall be registered with the BSP to allow servicing of payments using FX resources of AABs/AAB forex corps. Applications for loan approval (Annex D.2.A) and registration (Annex D.2.B) shall be in the prescribed BSP forms and filed with the BSP, together with supporting documents/information, as follows:

   1. For loan approval — at least 30 banking days before the target signing date of the loan/borrowing documents. Loan/borrowing agreements which have been signed and/or drawn/availed of prior to securing the requisite BSP approval shall not be eligible for approval and registration.

   2. For registration — within six (6) months from utilization of proceeds. Covering loan/borrowing documents/agreements shall not be notarized.

 


2. Private sector foreign loans/borrowings (including those in the form of bonds/notes/other debt instruments issued offshore) that are not publicly-guaranteed¹⁸ and not covered by Section 24.3 shall be subject to registration with the BSP if these will ultimately be serviced with FX resources of AABs/AAB forex corps. The borrower shall:
   

   1. Submit a Notice to the BSP (Annex E.3), supported with a copy of the signed covering agreement(s)/document(s), within one (1) month from date of signing;

   2. Send a notification to BSP for: (i) change/s in the loan’s financial terms and conditions¹⁹; or (ii) cancellation (whether partial or in full) of the loan/commitment/agreement, within 15 banking days from availability of information/signing of the amended or supplemental agreement/effectivity date as the case may be, for monitoring purposes; and

   3. Apply for loan registration with the BSP within one (1) month from drawdown date (for short-term loans) and within six (6) months from utilization of proceeds (for medium- and long-term loans), using the prescribed form (Annex D.2.B), if the loan will ultimately be serviced with FX resources of AABs/AAB forex corps.

   Signed loan/borrowing documents/agreements submitted for final approval shall not be notarized.

3. The following private sector loans shall not require prior BSP approval and subsequent registration; Provided, these are duly reported to the BSP by the borrower/creditor using the prescribed forms:

   1. Foreign currency loans of resident borrowers from banks operating in the Philippines; Provided, that the obligations: (i) are not publicly-guaranteed; and (ii) are reported by the creditor bank to the BSP using the prescribed forms (Annexes E.4 and E.5);

   2. Short-term loans in the form of export advances from buyers abroad of resident exporters/borrowers (Annex E.1 for the exporter/borrower and Schedule 3 – “FX Acquisition from Loans” of FX Form 1 for creditor banks);

   3. Foreign obligations of residents under deferred letters of credit (L/Cs) or under documents against acceptance or open account (D/A-O/A) arrangements with a term of more than one (1) year that are not guaranteed by foreign governments/official export credit agencies (Annex E.2​ for the resident borrower); and

   4. Short-term trade loans of resident exporters/importers from OBUs and non-resident non-bank creditors that have been granted under BSP-reported lending programs; Provided, that the following reports shall be submitted to the BSP:

      1. By the borrower – monthly report on transactions and status of their short-term loans within five (5) banking days after end of reference month using the prescribed form (Annex E.1) until the obligations are fully settled; and

      2. By the creditor OBU – Schedule 4A (Part I) & 4B (Part II) – “Consolidated Report on Loans Granted by OBUs to Residents” of the “Statement of Assets and Liabilities” report of OBUs.
         

4. Private sector foreign/foreign currency loans/borrowings may be obtained to refinance outstanding foreign/foreign currency loans/borrowings; Provided, that the obligations to be refinanced are duly registered (for those requiring registration) with, or reported (for those requiring mere reporting) to, the BSP, pursuant to Sections 24.1 to 24.3.

 

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¹⁸ Including those that do not involve any exposure of a government-owned/controlled entity

¹⁹ Financial terms and conditions refer to committed amount, purpose, currency, interest rate, fees/charges, tenor, amortization schedule, default rate and prepayment. Changes in borrower/issuer/creditor/guarantor, availability/closing date, financial ratios/covenants, and/or availments/amendments/cancellation of related hedging instruments shall also be included in the notification to BSP.