Special Banking Laws Annotated

February 15, 2013

 In line with this advocacy, the Bangko Sentral ng Pilipinas just recently published the “Special Banking Laws Annotated” to educate and enlighten academicians, bankers, and the public on the provisions of various special banking laws.             This book, researched and written by an illustrious group of more than 30 lawyers of the BSP’s Office of the General Counsel and Legal Services or OGCLS,  is the latest addition to the series on the country’s banking laws. OGCLS is headed by Deputy Governor Juan de Zuniga, Jr.             The first book entitled, “The New Central Bank Act Annotated,” was launched in July 2010, while the second book, “The General Banking Law Annotated,” was launched in August 2011.             The “Special Banking Laws Annotated,” or the so-called Book III, provides authoritative vantage points and commentaries on special banking laws such as the Thrift Banks Act, Rural Banks Act, Special Provisions on Cooperative Banks from the Cooperative Code, Non-Stock Savings and Loan Associations Act, Philippine Deposit Insurance Corporation Charter, Secrecy of Bank Deposits  Law, Foreign Currency Deposits Act, Truth in Lending Act, Usury Law, and Unclaimed Balances Law.             In the book’s foreword, Ret. Chief Justice Reynato S. Puno said he was not aware of any central bank authority in the world that has undertaken the intellectual endeavor of coming out with the “Special Banking Laws Annotated.”             “But more than path-breaking, its impact in our expanding economy will be immeasurable,” Puno pointed out.             For one, the retired chief justice said, the book gives the public easy access to the country’s scattered laws on banking—available only to those with special interest on the subject.             “This lack of access by the people is crucial for it drives away many of them from patronizing the services of banks which are the primary engines of our economic growth,” Puno said, He added, “The annotations are reader-friendly and guaranteed to remove the scales of ignorance from the eyes of the unknowing.” BSP Governor Amando M. Tetangco, Jr. shared that the book’s discussions promoted understanding not only of the laws that govern particular banking institutions and consumer rights, but also of their policy implications and operational context. “To us, the completion of our three legal books constitutes a major step forward in our continuing program to promote understanding of banking laws and regulations not only among banks, government institutions, business, legal practitioners and the academe, but also among bank customers and the public in general,” Tetangco said. With this week’s launch of “Special Banking Laws Annotated,” I am one with the BSP officials and the book’s editorial board in hoping that this legal book project will promote better comprehension of, and hopefully better compliance with,  banking laws and regulations among all sectors of our society. Just like the raison d'être in the publication of my book, “Central Banking for Every Juan and Maria,” I believe that proper knowledge and understanding of our banking laws play an indispensable role in building a strong and vibrant Philippine economy which will provide a better life for all Filipinos.

Growing your small business (Concluded from last week)

February 8, 2013

These businessmen and women have been recipients of the Citi Micro-entrepreneur of the Year Awards (CMA) in the last 10 years since the program was created.             The CMA Program, according to Microfinance Council of the Philippines, Inc. Chairperson Mila Mercado- Bunker, is “a celebration of economic triumph amidst great odds at the grassroots level.”             “We have seen the transformation of these micro-entrepreneurs—from budding handicraft-makers to producers of world class quality products,” Mercado-Bunker said.             She added: “They have become responsible employers and role models of good citizenship—local economic heroes in their own right.”             Here are more great tips from these local economic heroes:   ·      Carina Gonato, lumpia seller o   Update yourself on what customers think and like about your product. o   Strive to learn how to improve your business. o   Read books and surf the Internet for pointers on how to be successful. o   Keep pursuing your goals.   ·      Felicidad Kalalo, copra products dealer o   Without trust and honesty, your business will never grow. o   If you borrow money, you must pay it back. Be regular with your payments so you can borrow again to grow your business. o   Be alert to how your business is going. If it is too slow and you’re losing money, look for another business. o   Do not be afraid of starting over. o   Most important, work hand-in-hand with your spouse.   ·      Ester Lumbo, pandan products entrepreneur o   With or without competition, work hard on your business and never give up. o   Make sure that production is on schedule and all orders are delivered on time. o   Give your customers beautiful and original designs to choose from. o   Careful planning is the key to a successful business.   ·      Consuelo Valenzuela, sabutan products entrepreneur o   Never borrow what you cannot afford to pay back. o   Do not take too many loans at one time, especially if your business is seasonal. o   Know when it is the right time to make a loan. o   Follow your repayment schedule strictly. o   Keep a list of things you have to do and complete each day.   ·      Cherry Yack, Sr., cassava cake businessman o   Avoid all vices because they take away from your time, your health, and your money. o   Do not let your workers do all the work for you, but make sure the people you hire are as hardworking as you. o   Always persevere and believe that God will lead you to your goal.

Growing your small business (First of Two Parts)

February 1, 2013

The book featured 10 microentrepreneurs who have received the “Citi Microentrepreneur of the Year” Award since the program was conceived 10 years ago.             “Their compelling stories lend a face to our philanthropic investment in the field of microfinance and microenterprise development,” said Sanjiv Vohra, Citi Country Officer for the Philippines.             Vohra added, “From their humble beginnings, these men and women are now shaping the future of their communities.”             In this week and next week’s column, allow me  to share with you some pearls of wisdom from these amazing microentrepreneurs:             ·      Jennilyn Antonio, peanut butter entrepreneur o   Problems are there to make us think. Learn from them. o   Trials are part of life. Also learn from them. o   Always do what is pleasing to the Lord, who gives you strength and guides you on the right path. o   If you borrow money, do everything you can to pay it back. o   Never forget the people who helped you succeed, especially those who trusted you with their money.   ·      Corazon Bautista, RTW (ready-to-wear) businesswoman o   Have a budget for your daily needs. o   Use any business loan solely for the business. o   Do not mix personal and business funds in order to keep track of how the business is going. o   Give opportunities to others. o   Maintain a good relationship with your workers.   ·      Dionesia dela Peña, suman entrepreneur o   Be nice in your dealings with everyone. o   Help the jobless by hiring them. o   Do not skimp on ingredients. o   Never mess with the taste that your customers like.   ·      Orlando Dulay, buko pie businessman o   Learn as much as you can about the business you are getting into. o   Find out where to source your raw materials. o   Make sure you always have enough basic supplies. o   Know your target market. o   Study your product’s marketability. o   Respect your workers’ rights.   ·      Nolie Estocado, Christmas decor entrepreneur o   Devote a lot of time to your business and do not leave it to others. o   Find out as much as you can about a new client before accepting a big order from him or her. o   Talk to your creditors when you are having problems making payments. o   Treat your workers fairly and honestly. o   Believe in yourself and do not allow others to rule your destiny.   (To be continued next week)

A Tradition of Excellence

January 25, 2013

The Banker, a monthly publication owned by the Financial Times Group of London, held the Central Banker of the Year Awards to celebrate bank officials who “successfully steered their countries through the economic turbulence of 2012.”             Tetangco joined the ranks of Bank of Canada Governor Mark Carney (Central Banker of the Year 2013 for the Americas), Saudi Arabian Monetary Agency Governor Fahad Al-Mubarak (For the Middle East), Banco Nacional de Angola Governor Jose Massano (For Africa), and Gov. Erdem Basci from Turkey (For Europe).             Basci was also chosen as Central Bank Governor of the Year 2013.             Our very own Tetangco has indeed continued the BSP leadership’s legacy of excellence set by the previous Bangko Sentral governors: Gabriel C. Singson, 1996 and 1997 Central Bank Governor of the Year (Asiamoney); and Rafael B. Buenaventura, 2001 Central Bank Governor of the Year in Asian Region (The Banker). In 2002 and 2003, Buenaventura was recognized as one of the world’s best governors with Grade “A” rating (Global Finance). Tetangco, for his part, was also one of Global Finance’s best Central Bank governors in 2006, 2007, 2011 and 2012.             Tetangco was likewise recognized as the 2012 Emerging Markets Central Bank Governor of the Year for Asia.             According to The Banker, the Philippines’ economy has performed strongly in the past year. Its growth in the third quarter of 2012 was the second highest in Asia after China, the London-based publication added.             “Ratings upgrades in the past year have put the Philippines just one notch away from investment grade—the level of Indonesia—which the country now has its sights on,” The Banker pointed out.             It added: “The sound monetary policy of the Bangko Sentral ng Pilipinas (BSP) and its governor, Amando Tetangco, has contributed to these improvements that have recently pushed the Philippines into the spotlight.”             To these praises, Tetangco replied, “We are proud to have contributed to the macroeconomic stability that our country now enjoys.”             The article also noted how 2012 was the fourth consecutive year the BSP has kept inflation under target—as inflation in November 2012 was only 2.8 percent (well within the BSP’s target of 3 to 5 percent).             “Such a benign inflation environment has allowed us to implement monetary policy supportive of economic growth, which was 6.5 percent for the first three quarters of 2012,” Tetangco said.             The BSP, according to The Banker, is presently considering lowering its inflation target range in 2015 to 2–4 percent. This new target range, explained Tetangco, should signal to the market that “we are serious about keeping prices low and stable.”             The Banker also mentioned how the Philippines has been recognized for placing importance on both the stability of the banking system and consumer protection.             Tetangco said of this in the article: “Our banking system has remained sound. It is growing. It is liquid. It continues to intermediate funds to productive use, and its overall balance sheet remains healthy.”             The BSP governor also added that in addition to their work along the traditional pillars of central banking, they have re-energized the Bangko Sentral’s advocacy on financial inclusion, financial education, and consumer protection.

The need to save (First of Two Parts)

January 11, 2013

Just a few weeks back, we observed National Banking Week—a special opportunity that seeks to highlight the benefits banks provide to society.             National Banking Week, annually held every first week of January, enjoins all banking institutions and their branches to undertake promotional and publicity-generating activities regarding their significant role in the Filipino community, pursuant to Proclamation No. 2250 dated 10 December 1982.             This year’s theme is “Masaganang Lipunan, Bunga ng Salaping Iniingatan.  Mag-impok sa Bangko.”               The Financial Consumer Affairs Group (FCAG) of the Bangko Sentral ng Pilipinas, in its weekly e-newsletter, stressed the need for continuing campaign efforts to highlight the importance of saving in banks.             Citing the 2009 Consumer Finance Survey conducted by the Bangko Sentral’s Department of Economic Statistics, the FCAG disclosed that eight out of ten or 78.5 percent of Filipino households still do not have a bank deposit account.             The survey further showed that 92.8 percent of that figure stated “the lack of money” as the primary reason for the absence of a bank account. On the other hand, the remaining 7.2 percent of the households cited the following: ·         do not need a bank/cash account (1.7 percent); ·         cannot manage an account (1.5 percent); ·         minimum balance is too high (1.2 percent); ·         do not like to deal with banks/financial institutions (1 percent); and ·         others not specified (1.8 percent).  Lastly, the BSP data revealed that households in areas outside the National Capital Region were found less inclined to open bank accounts than those residing in Metro Manila. “What people ought to realize is that saving money in banks is way more advantageous than keeping it elsewhere such as in piggy banks, in a locked drawer or cabinet at home, or through the traditional under-the-mattress approach,” the FCAG explained. The FCAG quoted the following reasons on why banks are important from financial websites www.topbusinessfinance.com and lawschool.unm.edu: ·         Safety—The bank remains the safest place to keep one’s money, according to FCAG.  Banks maintain high security facilities that protect a depositor’s money from theft and safeguard it from the elements and other disasters such as fire, floods and the action of rodents or insects.  ·         Interest—Instead of letting your money “sleep” at home, the FCAG advised, deposit it in the bank where it has the potential to earn interest. The amount you get may not seem like much, but rest assured that it grows over time and adds up very quickly (the FCAG referred to this as “the power of compounding interest”).  It stressed: “The earlier you start saving in the bank and if you continue putting more money in the pot, the better.” (To be continued next week)

Saving in Banks (Concluded from last week)

January 8, 2013

 National Banking Week is held on every first week of January, and enjoins all banks to promote and publicize their activities in the local communities.             In an e-newsletter, the Financial Consumer Affairs Group (FCAG) of the Bangko Sentral ng Pilipinas discussed the need for continuing campaign efforts to highlight the importance of saving in banks.             Citing financial websites www.topbusinessfinance.com and lawschool.unm.edu, the FCAG noted “safety” and “interest” as the top reasons why banks are essential to us.             The bank, of course, remains the safest place to keep one’s money. High security facilities ensure that the money is protected from theft, damaging elements (e.g. rodents, insects), and disasters (e.g. fire, flood).             Banks also allow one’s money to earn interest, as opposed to letting it lie “dormant” in one’s house, the FCAG said.             Here are the other reasons why a financial consumer should seriously consider putting his or her money in the bank:   ·      Convenience—There are several bank branches to serve you so you always have easy access to your money. Most banks likewise offer complementary online banking services such as bills payment, fund transfers and e-shopping. ·      Credit—Banks can help a financial consumer establish and build a credit history.  They are willing to loan money to people with good financial standing and who manage their finances responsibly.  If you start that relationship with the bank, they will be able to work with you when you need help (e.g. obtaining housing or car loans). ·      Economic growth—The FCAG said that through banks, an ordinary depositor can help “pump prime” the economy.  Banks can “assist” families in buying homes, help small businesses to grow and thrive, and ultimately promote the country as a favorable place for doing business.  ·      Protection—Banks are highly regulated institutions, according to FCAG. The biggest safety net that you have with your bank savings comes from the Philippine Deposit Insurance Corporation, which insures savings of up to P500,000.  “Further, be secure knowing that the BSP, as the supervisor of all banks, continues to formulate policies and institute controls that protect clients and their money from over-profiteering or erring bankers,” the FCAG emphasized.   We should also be aware that there is an existing Memorandum of Agreement between the Bangko Sentral and members of the Bank Marketing Association of the Philippines (BMAP) regarding a special kiddie account program. The BMAP, comprised of the country’s leading banks, has developed the “Banking on Your Future (BOYF) Kiddie Account Program.” This new type of savings account encourages kids and schoolchildren to start the habit of saving regularly. The program allows kids to avail of their kiddie savings accounts with P100 or less initial deposit and to build up the balance to the required minimum to earn interest. Participating BMAP member banks include Allied Banking Corporation; Banco de Oro Unibank, Inc.; Bank of the Philippine Islands; China Bank Savings, Inc.; Development Bank of the Philippines; East West Banking Corporation; Maybank Philippines Inc.; Philippine National Bank; Philippines Savings Bank; Philippine Veterans Bank; RCBC Savings Bank; and Security Bank Corporation.


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