DOSRI Accounts Coverage Persons Covered
Directors
Officers
Stockholders of record owning at least 1% of stock of the bank
Related Interests of DOS of bank o
Related interests refer to
DOS’ spouse and/or relative within first degree of consanguinity or affinity
Partnership of which DOSRI is a general partner
Co-owner with DOSRI of interest or right mortgaged, pledged, or assigned to secure the DOSRI loans
Corporation, association or firm of which DOSRI is director or officer
Corporation, association or firm of which DOSRI owns at least 20% of subscribed capital stock
Corporation, association or firm wholly or majority owned or co ntrolled by any related entity or group of entities mentioned in Ii, iv, v above
Corporation, association or firm which owns or controls directly or indirectly whether singly or as a part of group of RI at least 20% of the subscribed capital stock of substantial stockholder of lending bank or which controls majority interest of the bank
Corporation, association or firm which has an existing management c ontract or any similar arrangement with parent of lending bank
Transactions Covered
Includes o
Any advance by means of incidental or temporary overdraft, cash item, “vale”, etc
o
Any advance of unearned salary or other unearned compensation for periods in excess of 30 days
o
Any advance by means of Drawings Against Uncollected De posits (DAUDs)
o
Outstanding availments under an established credit line
o
Drawings against an existing letter of credit
o
Acquisition of any note, draft, bill of exchange or other evidence of indebtedness upon
which the bank’s DOSRIs may be liable as makers, drawers, acceptors, endorsers, guarantors or sureties o
Indirect lending such as loans or other cre dit accommodations granted by another financial intermediary to said DOSRIs from funds of the bank invested in t he other
institution’s trust or the department when there is a clear relationship between the transactions
o
Increased of an existing indebtedness, as well as additional availments under a c redit line or additional drawings against a letter of cr edit
o
Sale of assets, such as shares of stocks, on credit; AND
o
Any other transaction as a result of which bank’s DOSRIs become obligated or may become obligated to lending bank, by any means whatsoever to pay money or its equivalent.
Direct Borrowings: o
DOS Becomes:
A borrower of the bank
A guarantor, indorser, surety for loans from the bank
The loan or credit accommodation to another party is secured by property interest or right of the DOS
Indirect Borrowings o
If any of the covered transactions, the borrower, guarantor, endorse or surety is a related interest
Ceilings or Exclusions
Individual ceiling o
Amount equivalent to DOSRI’s unencumbered deposits and book value of paid-in capital contribution in bank, subject to the following exclusions
o
Loans, other credit accommodations and guarantees to the extent secured by asse4ts considered as non-risk by Monetary Board
o
Loans, other credit accommodations and advances to officers in the form of fringe benefits
o
Loans, other credit accommodations and guarantees exte nded by Cooperative Bank to its cooperative shareholders
o
Note: Unsecured loans, other credit ac commodations and guarantees to each of the
bank’s DOSRIs shall not exceed 30% of their total loans, other credit accommodations and guarantees
Aggregate Ceiling – Amount shall not exceed 15% of the total loan portfolio of the bank or 100% of its net worth, whichever is lower, subject to the following exclusions: o
Credit accommodations or portions thereof to the e xtent secured by assets considered as non-risk by Monetary Board
o
Loans, other credit accommodations and advances to officers in the form of fringe benefits
o
Loans, other credit accommodations and guarantees extended by Cooperative Bank to its cooperative shareholders
o
Credit accommodations to a corporate stockholder
Which is a non-financial institution
Whose shares are listed and traded in the PSE
With no person or group of persons r elated within first degree of consanguinity or affinity holds more than 20% of the subscribed capital stock
o
Credit accommodations to GOCCs, in cases where a DOS of lending bank is a representative of the government in the borrowing corporation and does not hold any proprietary interest in such corporation.
o
Note: total unsecured loans, other credit accommodations and guarantees to bank’s DOSRIs shall not exceed 30% of the aggregate ceiling or the outstanding loans, other credit accommodations and guarantees, whichever is lower.
Requirements
Dealings shall be upon terms not less favorable to bank than t hose offered to others
Loans must be approved in writing by majority of all directors of the bank, excluding the director concerned; AND
Approval shall be entered upon records of bank and copy tr ansmitted to BSP’s Supervision and Examination Department (SED)
Sanctions
If there is a violation of the Sec. 36 of the GBL, upon due notice to the Board of Directors, the office of director or officer who violates m ay be declared vacant and the director or other officer may be subject to penal provisions of the NCBA.