BSP extends relief to Lando-hit banks

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) has extended relief to borrowers, banks, and financial institutions in areas battered by Typhoon Lando last month.

 BSP Deputy Governor Nestor Espenilla Jr. issued Memorandum Order M-2015-039 to grant temporary regulatory and rediscounting relief measures to banks and non-bank financial with quasi banking functions (NBQBs) in provinces in northern and central Luzon.

 Provinces covered by the order include Ilocos Norte, Ilocos Sur, La Union, Pangasinan, Cagayan, Isabela, Nueva Vizcaya, Quirino, Aurora, Bataan, Bulacan, Nueva Ecija, Pampanga, Tarlac, Zambales, Cavite, Batangas, Laguna, Quezon, Rizal, Camarines Norte, Cantanduanes, Abra, Apayao, Benguet, Ifugao, Kalinga, and Mountain Province.

These provinces were chosen based on the assessment by the National Disaster Risk Reduction and Management Council.

 Under the temporary relief measures, the BSP allowed all banks to provide financial assistance to their officers and employees who were affected by the calamity, including those not included under BSP-approved Fringe Benefit Program.

 Thrift, rural, and cooperative banks as well as NBQBs may also exclude outstanding loans of borrowers from the computation of past due ratios, the central bank said.

These provided loans are restructured or given relief and reduce the five percent general loan loss provision to one percent for restructured loans of borrowers.

 The central bank also agreed not to impose penalties on legal reserves deficiencies and to impose a moratorium on monthly payments due to BSP for banks with ongoing rehabilitation programs.

 Subject to BSP approval, booking of allowance for probable losses may also be done on a staggered basis over a maximum period of five years.

 The BSP would likewise not impose monetary penalties for delays in the submission of supervisory reports aside from a 60-day grace period for banks who were not able to pay their rediscounting obligations as of Oct. 18.

 On a case-to-case basis, BSP also allowed the restructuring of the outstanding rediscounted loans of borrowers affected by the calamity.

 Espenilla said the relief measures would be in effect for a defined period and covered by additional specific and other prudential conditions

The BSP earlier extended relief measure to borrowers, banks, and NBQBs in areas affected by Super Typhoon Yolanda, Agaton, Glenda, Luis, Mario, Ruby, Ineng, and Seniang.