BSP readies regulatory relief for banks in typhoon-hit areas

MANILA - The Bangko Sentral ng Pilipinas (BSP) will provide regulatory relief for banks in areas that took a hit from Typhoon 'Yolanda'.

“There are many logistical difficulties but BSP will be working closely with our affected banks to help restore their operations at the soonest possible time so they can start serving again their customers especially with cash withdrawals now and later with loans to help them recover and rebuild,” BSP Deputy Governor Nestor A. Espenilla Jr. said in his speech before the Rural Bankers Association of the Philippines (RBAP).

“You can expect immediate deployment of our standard regulatory relief package designed precisely to help cope with calamities,” Espenilla said.

Most banks in typhoon-hit areas closed after 'Yolanda' -- the most powerful storm so far this year -- downed power and communication lines.

Recently, the BSP relaxed the regulatory requirements on banks in the provinces that were hard hit by an earthquake last month.

For the thrift, rural and cooperative banks, the BSP's Monetary Board approved temporary relief measures that include exempting outstanding loans in affected quake areas from the computation of past due ratios. The exemption is premised on banks allowing the restructuring of these loans or such other relief.

The BSP also reduced the general loan loss provision to one percent from the existing five percent for restructured loans of borrowers in the quake affected areas, thus freeing up otherwise non-earning assets of banks for lending.

The central bank also would forgo penalties on legal reserves deficiencies on thrift, rural and cooperative banks in the quake-hit areas, as well as the monetary penalties for delays in the submission of supervisory reports.

A moratorium would also be observed on monthly payments to the BSP for banks under rehabilitation.

The BSP also allowed banks to extend financial assistance to their officers and employees who were affected by the calamity, including assistance that is not within the scope of existing fringe benefit programs. (Source: interaksyon)