MORNBFI Vol. 1 - Planters Development Bank

§§ 4441Q.7 - 4441Q.911.12.31documentation to govern its relationshipwith the Issuer.§ 4441Q.8 Protection of securities ofthe customer. A custodian must incorporatethe following procedures in the dischargeof its functions in order to protect thesecurities of the customer:a. Administration of securitiescustodianship accounts. Securitiescustodianship accounts must beadministered in the entity’s Trust Unit.b. Accounting and recording forsecurities. Custodians must employaccounting and safekeeping procedures thatfully protect customer securities. It isessential that custodians segregate customersecurities from one another and from itsproprietary holdings to protect the samefrom the claims of its general creditors.Securities held under custodianshipshall be recorded in the books of thecustodian at the face value of said securitiesin the other fiduciary sub-account“Custodianship”.c. Documentation. The appropriatedocumentation for custodianship shall bemade and it shall clearly define, among others,the authority, role, responsibilities, fees andprovision for succession in the event thecustodian can no longer discharge itsfunctions. It shall be accepted in writing bythe counterparties.The governing custodianship agreementshall be pre-numbered and this number shallbe referred to in all amendments andsupplements thereto.d. Confirmation of custody. Thecustodian shall issue a custody confirmationto the purchaser or borrower of securitiesto evidence receipt or transfer of securitiesas they occur. It shall contain, as aminimum, the following information on thesecurities under custody:(1) Owner of securities;(2) Issuer;(3) Securities type;(4) Identification or serial numbers;(5) Quantity;(6) Face value; and(7) Other information, which may berequested by the parties.e. Periodic reporting. The custodianshall prepare at least quarterly (or asfrequent as the owner of securities willrequire) securities statements delivered tothe registered owner’s address on record.Said statement shall present detailedinformation such as, but not limited to,inventory of securities, outstandingbalances, and market values.(As amended by Circular No. 714 dated 10 March 2011)§ 4441Q.9 Independence of theregistry and custodian. A BSP-accreditedsecurities registry must be a third partywith no subsidiary/affiliate relationshipwith the issuer of securities while aBSP-accredited custodian must be a thirdparty with no subsidiary/affiliate relationshipwith the issuer or seller of securities. A QBtrust entity accredited by BSP as securitiescustodian may, however, continue holdingsecurities it sold under the following cases:a. where the purchaser is a relatedentity acting in its own behalf and not asagent or representative of another;b. where the purchaser is anon-resident with existing global custodyagreement governed by foreign laws andconventions wherein the institution isdesignated as custodian or sub-custodian;andc. upon approval by the BSP, wherethe purchaser is an insurance companywhose custody arrangement is eithergoverned by a global custody agreementwhere the QB/trust entity is designated ascustodian or sub-custodian or by a directcustody agreement with features at parQ RegulationsPart IV - Page 44Manual of Regulations for Non-Bank Financial Institutions