MORNBFI Vol. 1 - Planters Development Bank

§§ 4254Q - 4254Q.308.12.31capitalized interest on the underlyingzero-coupon Treasury Notes as and whenthe corresponding interest is earned over thelife of the bonds.Any deficiency in the liquidity reserveshall continue to be in the forms or modesprescribed under existing regulations for thecomposition of required reserves.b. The balance shall be as follows:(1) At least ten percent (10%) in theform of deposit balances with the BSP;(2) A maximum of seventy-five percent(75%) in the form of government securities;and(3) The balance in the form of demanddeposit accounts with banks which are notrestricted as to withdrawal or use for currentoperations but not with FIs which have beenclosed and are under receivership orliquidation.For purposes of this Subsection,government securities eligible as reservesagainst deposit substitute liabilities of QBsas referred to in Item "b(2)" above shall belimited to bonds or other evidences ofindebtedness representing direct obligationsof the government of the Republic of thePhilippines having the following minimumfeatures/conditions:(i) The securities must bear an interestrate of not more than four percent (4%) perannum, must be non-negotiable and shallcarry BSP support; and(ii) The instrument must expressly statein its face the amount, maturity date andinterest rate of the obligation.A list of reserves-eligible andnon-eligible securities may be found inAppendix Q-9.Other government securities being usedfor reserve purposes shall continue to be eligibleas such: Provided, That whenever said securitiesshall have matured, they shall be replaced bysecurities carrying the above features.Securities held as reserves shall bevalued at cost of acquisition, and the QBmay freely alter its composition: Provided,That any substitution or acquisition satisfiesthe eligibility requirements prescribedabove: Provided, further, That the QB notifiesthe BSP of any such change not later than thereporting day following the change.Securities counted as reserves whichare hypothecated or encumbered in anyway or earmarked for any other purposeshall automatically lose their eligibility asreserves.Only the buying/lending QB in a resaleagreement covering eligible governmentsecurities may use such securities asreserves against deposit substitute liabilities.Conversely, the selling/borrowing QB in arepo agreement covering eligiblegovernment securities may not use suchsecurities as reserves against depositsubstitute liabilities.The reserve eligibility of governmentsecurities under the reverse repo operationsof the BSP shall be suspended during theterm of the repo agreement. The phrase nonreserveeligible shall be stamped on the faceof the custodian receipt being issued by theBSP to buyer FIs.(As amended by Circular Nos. 551 dated 17 November 2006and 539 dated 09 August 2006)§ 4254Q.1 (2008 - 4246Q.5) Maturedand unclaimed deposit substitutes. Maturedand unclaimed deposit substitutes shallcontinue to be subject to reserves.§ 4254Q.2 (Reserved)§ 4254Q.3 (2008 - 4246Q.7) Intereston reserve deposit with Bangko SentralDeposits maintained by QBs with the BSPup to forty percent (40%) of their reserverequirement (excluding the percentage ofliquidity reserves required on depositsubstitute liabilities of QBs under Sec.4253Q) shall be paid interest at four percent(4%) per annum based on the average dailybalance of said deposits to be creditedquarterly.Q Regulations Manual of Regulations for Non-Bank Financial InstitutionsPart II - Page 10