MORNBFI Vol. 1 - Planters Development Bank

§§ 4409Q.09 - 4409Q.1608.12.31e. Sanctions. Any violation of theprovisions of this Subsection shall besubject to the sanctions provided underSection 37 of R.A. No. 7653 (The NewCentral Bank Act).(Circular Nos. 553 dated 22 December 2006 and 521 dated21 March 2006)§§ 4409Q.10 - 4409Q.15 (Reserved)§ 4409Q.16 Qualification andaccreditation of quasi-banks acting as trusteeon any mortgage or bond issuance by anymunicipality, government-owned orcontrolled corporation, or any body politica. Applicability. QBs duly accreditedby the BSP may act as trustee on anymortgage or bond issued by anymunicipality, GOCC, or any body politic.b. Application for accreditation. A QBdesiring to act as trustee on any mortgageor bond issued by any municipality,GOCC, or any body politic shall file anapplication for accreditation with theappropriate department of the SES. Theapplication shall be signed by the presidentor officer of equivalent rank of the QB andshall be accompanied by the followingdocuments:(1) certified true copy of the resolutionof the institution’s board of directorsauthorizing the application;(2) a certification signed by thepresident or officer of equivalent rank thatthe institution has complied with all thequalification requirements for accreditation.c. Qualification requirements. A QBapplying for accreditation to act as trusteeon any mortgage or bond issued by anymunicipality, GOCC, or any body politicmust comply with the requirements inAppendix Q-31.d. Independence of the trustee. A QBis prohibited from acting as trustee of amortgage or bond issuance if any electiveor appointive official of the LGU, GOCC,or body politic which issued said mortgageor bond and/or his related interests ownsuch number of shares of the QB that willallow him or his related interests to elect atleast one (1) member of the board ofdirectors of such QB or is directly orindirectly the registered or beneficial ownerof more than ten percent (10%) of any classof its equity security.e. Investment and management of thefunds. A domestic QB designated as trusteeof a mortgage or bond issuance may holdand manage, in accordance with theprovisions of the trust indenture oragreement, the proceeds of the mortgageor bond issuance and such assets and fundsof the issuing municipality, corporation, orbody politic as may be required to bedelivered to the trustee under the Trustindenture/agreement, subject to thefollowing conditions/restrictions:(1) Pending the utilization of suchfunds pursuant to the provisions of the trustindenture/agreement, the same shall onlybe (i) deposited in a bank authorized toaccept deposits from the Government orgovernment entities: Provided, That thedepository bank is not a subsidiary oraffiliate of the trustee QB, or (ii) investedin peso-denominated treasury billsacquired/purchased from any securitiesdealer/entity, other than the trustee or anyof its unit/department, its subsidiary oraffiliate.(2) Investments of funds constitutingor forming part of the sinking fund createdas the primary source for the payment ofthe principal and interests due themortgage or bonds shall also be limitedto deposits in any bank authorized toaccept deposits from the Government orgovernment entities and investments ingovernment securities that are consistentwith such purpose which must beacquired/purchased from any securitiesdealer/entity, other than the trustee or anyof its unit/department, its subsidiary oraffiliate.Manual of Regulations for Non-Bank Financial InstitutionsQ RegulationsPart IV - Page 19