R PHILIPPINES C PHILIPPINES H. No. 7037 First Regular ...

1 republic OF THE PHILIPPINESCONGRESS OF THE PHILIPPINESH. No. 7037 first Regular Session }S. No. 1235 republic ACT NO. 7653 THE NEW CENTRAL BANK ACTBe it enacted by the Senate and House of Representatives of thePhilippines in Congress assembled:CHAPTER IESTABLISHMENT AND ORGANIZATIONOF THE BANGKO SENTRAL NG PILIPINASARTICLE I. CREATION, RESPONSIBILITIES AND CORPORATEPOWERS OF THE BANGKO SENTRALSECTION of Policy. _ The State shallmaintain a central monetary authority that shall function andoperate as an independent and accountable body corporate in thedischarge of its mandated responsibilities concerning money,banking and credit. In line with this policy, and considering itsunique functions and responsibilities, the central monetaryauthority established under this Act, while being a government-owned corporation, shall enjoy fiscal and administrative of the Bangko Sentral.

2 _ There is herebyestablished an independent central monetary authority, whichshall be a body corporate known as the Bangko Sentral ngPilipinas, hereafter referred to as the Bangko capital of the Bangko Sentral shall be Fifty billion pesos(P50,000,000,000), to be fully subscribed by the Government ofthe republic , hereafter referred to as the Government, Ten billionpesos (P10,000,000,000) of which shall be fully paid for by theGovernment upon the effectivity of this Act and the balance to bepaid for within a period of two (2) years from the effectivity of thisAct in such manner and form as the Government, through theSecretary of Finance and the Secretary of Budget andManagement, may thereafter and Primary Objective. _ TheBangko Sentral shall provide policy directions in the areas ofmoney, banking, and credit.

3 It shall have supervision over theoperations of banks and exercise such regulatory powers asprovided in this Act and other pertinent laws over the operationsof finance companies and non-bank financial institutionsperforming quasi-banking functions, hereafter referred to as quasi-banks, and institutions performing similar primary objective of the Bangko Sentral is to maintainprice stability conducive to a balanced and sustainable growth ofthe economy. It shall also promote and maintain monetarystability and the convertibility of the of Business. _ The Bangko Sentral shall haveits principal place of business in Metro Manila, but may maintainbranches, agencies and correspondents in such other places asthe proper conduct of its business may Powers.

4 _ The Bangko Sentral is herebyauthorized to adopt, alter, and use a corporate seal which shall bejudicially noticed; to enter into contracts; to lease or own real andpersonal property, and to sell or otherwise dispose of the same; tosue and be sued; and otherwise to do and perform any and allthings that may be necessary or proper to carry out the purposesof this Bangko Sentral may acquire and hold such assets andincur such liabilities in connection with its operations authorizedby the provisions of this Act, or as are essential to the properconduct of such Bangko Sentral may compromise, condone or release,in whole or in part, any claim of or settled liability to the BangkoSentral, regardless of the amount involved, under such termsand conditions as may be prescribed by the Monetary Board toprotect the interests of the Bangko II.

5 THE MONETARY BOARDSEC. of the Monetary Board. _ The powersand functions of the Bangko Sentral shall be exercised by theBangko Sentral Monetary Board, hereafter referred to as theMonetary Board, composed of seven (7) members appointed bythe President of the PHILIPPINES for a term of six (6) seven (7) members are:(a)the Governor of the Bangko Sentral, who shall be theChairman of the Monetary Board. The Governor of the BangkoSentral shall be head of a department and his appointment shallbe subject to confirmation by the Commission on the Governor is unable to attend a meeting of the Board,he shall designate a Deputy Governor to act as his alternate:Provided, That in such event, the Monetary Board shall designateone of its members as acting Chairman;(b)a member of the Cabinet to be designated by thePresident of the PHILIPPINES .

6 Whenever the designated CabinetMember is unable to attend a meeting of the Board, he shalldesignate an Undersecretary in his Department to attend as hisalternate; and(c)five (5) members who shall come from the private sector,all of whom shall serve full-time: Provided, however, That of themembers First appointed under the provisions of this subsection,three (3) shall have a term of six (6) years, and the other two (2),three (3) member of the Monetary Board may be reappointed morethan _ Any vacancy in the Monetary Boardcreated by the death, resignation, or removal of any member shallbe filled by the appointment of a new member to complete theunexpired period of the term of the member _ The members of the MonetaryBoard must be natural-born citizens of the PHILIPPINES , at leastthirty-five (35) years of age, with the exception of the Governorwho should at least be forty (40)

7 Years of age, of good moralcharacter, of unquestionable integrity, of known probity andpatriotism, and with recognized competence in social and _ In addition to thedisqualifications imposed by republic Act No. 6713, a member ofthe Monetary Board is disqualified from being a director, officer,employee, consultant, lawyer, agent or stockholder of any bank,quasi-bank or any other institution which is subject to supervisionor examination by the Bangko Sentral, in which case suchmember shall resign from, and divest himself of any and allinterests in such institution before assumption of office as memberof the Monetary members of the Monetary Board coming from theprivate sector shall not hold any other public office or publicemployment during their person shall be a member of the Monetary Board if hehas been connected directly with any multilateral banking orfinancial institution or has a substantial interest in any privatebank in the PHILIPPINES .

8 Within one (1) year prior to hisappointment; likewise, no member of the Monetary Board shallbe employed in any such institution within two (2) years after theexpiration of his term except when he serves as an officialrepresentative of the philippine Government to such _ The President may remove anymember of the Monetary Board for any of the following reasons:(a)If the member is subsequently disqualified under theprovisions of Section 8 of this Act; or(b)If he is physically or mentally incapacitated that hecannot properly discharge his duties and responsibilities and suchincapacity has lasted for more than six (6) months; or(c)If the member is guilty of acts or operations which areof fraudulent or illegal character or which are manifestly opposedto the aims and interests of the Bangko Sentral; or(d)If the member no longer possesses the qualificationsspecified in Section 8 of this _ The Monetary Board shall meet atleast once a week.

9 The Board may be called to a meeting by theGovernor of the Bangko Sentral or by two (2) other members ofthe presence of four (4) members shall constitute a quorum:Provided, That in all cases the Governor or his duly designatedalternate shall be among the four (4).Unless otherwise provided in this Act, all decisions of theMonetary Board shall require the concurrence of at least four (4) Bangko Sentral shall maintain and preserve a completerecord of the proceedings and deliberations of the Monetary Board,including the tapes and transcripts of the stenographic notes,either in their original form or in of the Deputy Governors. _ TheDeputy Governors may attend the meetings of the Monetary Boardwith the right to be _ The salary of the Governor and themembers of the Monetary Board from the private sector shall befixed by the President of the PHILIPPINES at a sum commensurateto the importance and responsibility attached to the of Persons Having a PersonalInterest.

10 _ In addition to the requirements of republic Act , any member of the Monetary Board with personal orpecuniary interest in any matter in the agenda of the MonetaryBoard shall disclose his interest to the Board and shall retirefrom the meeting when the matter is taken up. The decisiontaken on the matter shall be made public. The minutes shallreflect the disclosure made and the retirement of the memberconcerned from the of Authority. _ In the exercise of itsauthority, the Monetary Board shall:(a)issue rules and regulations it considers necessary forthe effective discharge of the responsibilities and exercise of thepowers vested upon the Monetary Board and the Bangko rules and regulations issued shall be reported to the Presidentand the Congress within fifteen (15) days from the date of theirissuance;(b)direct the management, operations, and administrationof the Bangko Sentral, reorganize its personnel, and issue suchrules and regulations as it may deem necessary or convenient forthis purpose.