Regulatory relief bared for typhoon-hit lenders

LENDERS affected by the recent Typhoon Luis (international code name Kalmaegi) and Typhoon Mario (international code name Fung-Wong) will be subject to less strict regulatory measures on loans as part of so-called regulatory forbearance granted by the Bangko Sentral ng Pilipinas (BSP).

The policy-making body of the central bank, the Monetary Board, only recently approved the regulatory and rediscounting relief packages for banks whose head offices or branches were devastated by the two recent typhoons that hit the country.

Covered by the relief measures were the areas severely affected by the recent typhoon as declared by the National Disaster Risk Reduction and Management Council.

The areas include Caloocan City, Las Piñas, Manila, Malabon City, Mandaluyong City, Marikina City, Muntinlupa City, Navotas City, Pasay City, Pasig City, Quezon City, Taguig City, San Juan City and Valenzuela City.

Outside the National Capital Region, banks in Aurora, Bataan, Bulacan, Pampanga, Tarlac, Zambales, Batangas, Cavite, Laguna, Quezon and Rizal will also be granted the same relief package in the light of Typhoon Glenda’s destruction.

Likewise, lenders in Ilocos Norte, Ilocos Sur, La Union, Pangasinan, Occidental Mindoro, Oriental Mindoro, Camarines Norte, Camarines Sur, Catanduanes, Negros Occidental, Cebu, Abra, Benguet, Apayao, Kalinga, Mountain Province and Ifugao.

The temporary relief measures will allow all banks to provide financial assistance to their officers and employees who were affected by the calamity. This includes assistance that may not be within the scope of the existing BSP-approved fringe benefit program.

For all thrift, rural and cooperative banks in the areas affected, the BSP will exclude existing loans of borrowers from the computation of past due loan ratios as long as these are restructured or given relief.

The BSP will also lift the imposition of penalties on legal reserve deficiencies and delays of submission of supervisory reports of smaller banks in affected areas.

A moratorium will also be given on monthly payments due to the BSP for banks with on-going rehabilitation programs.

The booking of allowance for probable losses on a staggered basis of a maximum of five years for all types of loans extended to borrowers will also be allowed, subject to BSP approval.

For all rediscounting banks in the area, the regulatory relief package includes the granting of a 60-day grace period to settle the outstanding rediscounting obligations as of mid-July. The central bank also allowed banks to restructure the outstanding rediscounted loans if borrowers were affected by the calamity.

Similar relied measures were extended previously by the BSP to banks in cities and provinces affected by the previous natural calamities. 

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Bianca Cuaresma graduated cum laude from the University of Santo Tomas (UST) with a degree in AB Journalism. She was with the BusinessMirror during her internship in 2012 where she was assigned at the Department of Foreign Affairs (DFA) beat. She continued to be of service to the paper after she graduated in 2013. In 2014, she was awarded as the Reporter of the Year by the paper for her coverage in the Bangko Sentral ng Pilipinas (BSP). She is a BusinessMirror reporter for 3 years now, and has covered general assignments and agencies related to banking and finance in the country.

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