BSP streamlines guidelines for voluntary surrender of licenses – BusinessWorld Online
THE Monetary Board (MB) has authorized streamlined standards on the voluntary surrender of banking licenses.
In a declaration, the Bangko Sentral ng Pilipinas (BSP) stated the enhanced guidelines authorized by its policy-making body will cover banks that prepare to proceed to voluntary dissolution and liquidation or those who intent keep their business or cooperative life and transform into a nonbank entity.
” The streamlining of the guidelines emphasizes the main requirement that just a bank in sound financial condition and does not have any of the grounds to prohibit it from operating under Area 30 of Republic Act (RA) No. 7653 or the New Reserve Bank Act, as modified, may be allowed to go through voluntary surrender of its banking license,” the reserve bank stated.
Section 30 of RA 7653 states proceedings in receivership and liquidation will take place when the MB finds that a bank or quasi-bank is unable to pay its liabilities as they end up being due; has inadequate possible assets– as determined by the BSP– to satisfy its liabilities; can not continue in service without including possible losses to its depositors or lenders; or has actually willfully violated a cease and desist order under that has become last.
The main bank stated the brand-new guidelines cover circumstances of voluntary surrender where no lenders will be affected throughout the resulting voluntary dissolution or the conversion into a nonbank entity.
” At the minimum, the candidate bank will make sure right away accessible funds comparable to its outstanding deposit commitments to offer assurance on the payment of depositors,” the BSP said.
” The standards likewise stressed that even after the surrender of banking license, the BSP may impose sanctions to concerned bank’s directors, officers and employees who are discovered to have breached banking laws, guidelines and regulations,” the reserve bank included.