MORNBFI Vol. 1 - Planters Development Bank

§§ 4414Q.1 - 4415Q.308.12.31major violations or exceptions affecting itssolvency, liquidity and profitability.Where the applicant is not authorizedto engage in quasi-banking functions:(a) The adoption of a formula/criteriafor QBs in the determination of compliancewith the capital-to-risk assets ratio andceilings on loans to DOSRI; and(b) The substitution of the reserve andliquidity floor requirements with the cashratio, as follows:(i) Primary reserves to Bills Payable;and(ii) Primary and secondary reserve toBills Payable:where primary reserves consist of cash onhand, cash in vault, checks and other cashitems, due from the BSP and due frombanks; and where secondary reservesconsist of BSP-supported governmentsecurities, T- Bills and other governmentsecurities.Compliance with the foregoing, as wellas with other requirements under existingregulations, shall be maintained up to thetime the authority is granted. An applicantthat fails in this respect shall be required toshow compliance for another test period ofthe same duration.§ 4414Q.2 Pre-operating requirementsAn institution authorized to engage ininvestment management activities shall,before engaging in actual operations, submitto the BSP the following:a. Government securities acceptableto the BSP amounting to P500,000 asminimum basic security deposit for thefaithful performance of investmentmanagement duties required under Subsec.4415Q.1;b. Organization chart of the investmentmanagement department which shall carryout the investment management activities ofthe institution; andc. Names and positions of individualsdesignated as chairman and members ofthe investment management committee,investment management officer and othersubordinate officers of the investmentmanagement department.Sec. 4415Q Security for the FaithfulPerformance of Investment ManagementActivities§ 4415Q.1 Basic security depositAn institution authorized to engage ininvestment management activities shalldeposit with the BSP eligible governmentsecurities as security for the faithfulperformance of its investment managementactivities equivalent to at least one percent(1%) of the book value of the total volumeof investment management assets: Provided,That at no time shall such deposit be lessthan P500,000.Scripless securities under the RoSSsystem of the BTr may be used as basicsecurity deposit for the faithful performanceof investment management activities usingthe guidelines in Appendix Q-21.§ 4415Q.2 Eligible securities. Securitiesenumerated in Subsec. 4405Q.2 shall beeligible as security deposit for faithfulperformance of investment managementactivities.§ 4415Q.3 Valuation of securities andbasis of computation of the basic securitydeposit requirement. For purposes ofdetermining compliance with the basicsecurity deposit under this Section, theamount of securities so deposited shall bebased on their book value, that is, cost asincreased or decreased by thecorresponding discount or premiumamortization.The base amount for the basic securitydeposit shall be the average of themonth-end balances of the total assets ofinvestment management funds of theimmediately preceding calendar quarter.Q RegulationsPart IV - Page 34Manual of Regulations for Non-Bank Financial Institutions