MORNBFI Vol. 1 - Planters Development Bank

§§ 4601Q.1 - 4601Q.209.12.31Government securities which are heldby the issuer of the repo agreement underthe book-entry system with the BSP may beused as underlying instruments only withthe conformity of the BSP.e. Upon termination of the repoagreement, the issuer of such agreementshall claim and take delivery of theunderlying instruments at the TreasuryDepartment, BSP. Failure to claim and takedelivery of the underlying instrumentsimmediately upon such termination shallrelieve the BSP of any liability orresponsibility for the loss or misplacementof said instruments.§ 4601Q.2 (2008 - 4602Q.1) Reverserepurchase agreements with BangkoSentral. Reverse repo agreements may beeffected with the BSP subject to thefollowing terms and conditions:a. Rate. The rates shall be set by theTreasury Department, with the concurrenceof the Governor, taking into account theprevailing liquidity/market conditions.b. Term. At the option of the TreasuryDepartment, availments may be for aminimum of one (1) day (overnight) and amaximum of 364 days.c. Security. The collateral shall consistof obligations of the National Governmentand other freely negotiable securities in theBSP portfolio valued at 100%.d. Delivery. No delivery of thecollateral shall be made, but a custodyreceipt shall be issued instead.e. Reservation. Prepayment may bemade by the BSP at its option anytimebefore maturity.Effective 01 July 2003, published interestrates that will be applied on BSP’s reverserepo agreements shall be inclusive of ValueAdded Tax (VAT).Reverse repo agreements entered intoby the BSP with any authorized agent bank(AAB) are included in the definition of theterm “deposit substitutes” under Sec. 22 (y)Chapter 1 of the National Internal RevenueCode of 1997.The BSP shall withhold twenty percent(20%) Final Withholding Tax (FWT) on itsovernight reverse repo agreements startingJanuary 01, 2008, under the followingguidelines:(1) All overnight reverse repoagreements with the BSP shall be subject tothe twenty percent (20%) FWT in the samemanner as term reverse repo agreements,which tax is deducted on each maturity dateand remitted to the BIR;(2) With respect to the overnight RRPsfrom 01 January 2008 to 22 August 2008 1 ,the concerned QBs shall reimburse the BSPthe amount equivalent to forty percent (40%)of the twenty percent (20%) FWT duethereon. However, QBs which choose topay the whole twenty percent (20%) FWTshall remit the amount equivalent to the sixtypercent (60%) balance thereof to the BIR,through the BSP as withholding agent. Inboth cases, payment of the FWT to the BSPshall be made on or before 03 April 2009,either in full or in three (3) installments:Provided, That a QB which intends to payin installments shall remit the firstpayment on or before 06 March 2009, thesecond on or before 20 March 2009 andthe last on or before 03 April 2009:Provided, further, That payments due shallbe deducted from the Regular DemandDeposit Account (RDDA) of concernedQBs. The BSP shall issue the certificate offinal withholding tax reflecting theamount of the FWT paid; and(3) Concerned banks shall issue thecorresponding debit authority to the BSPto cover the twenty percent (20%) FWTon their overnight reverse repo agreementswith the BSP mentioned in Item “2”above.(As amended by Circular Nos. 647 dated 03 March 2009,636 dated 17 December 2008 and 619 dated 22 August 2008)1Interest income payments from 01 January 2008 to 26 August 2008.Q Regulations Manual of Regulations for Non-Bank Financial InstitutionsPart VI - Page 2