An entity desiring to do banking transactions in the Philippines must follow the BSPs application process.
First, the applicant must complete an Application for Authority to Establish a Bank (standard form provided by the BSP) in triplicate. The original copy and duplicate copy shall be submitted to the Central Applications and Licensing Group (CALG) of the BSP. The third copy shall be retained by the applicant.
Second, the applicant shall be required to submit papers/documents and information in support of the application, some of which must be in the format supplied by the BSP. Among these are the Agreement to Organize a Bank; biodata of each of the incorporators, proposed directors and officers, and subscribers; their Statement of Assets and Liabilities1; Statement of Income and Expense2; and other financial documents as may be required, as well as their clearances from the National Bureau of Investigation and Bureau of Internal Revenue. For corporate subscribers and foreign bank subscribers, the BSP requires, among others, relevant corporate papers and audited financial statements for the last two years prior to the application. Applicants must also submit a Detailed Plan of Operation and Economic Justification for establishing the bank.
Third, the applicant must comply with the minimum capital requirements (ranging from PHP 10 million3 to PHP 3 billion4). The application shall be processed on a first-come, first-served basis, provided that all the required documents are complete and properly accomplished.
Fourth, the incorporators/subscribers, proposed directors and officers of the bank shall be subject to qualifications, grounds for disqualification, and other requirements of existing laws, rules and regulations of the BSP.
Fifth, there is a procedure to be followed for the issuance of an Authority to Operate. Once the Monetary Board/governor of the BSP approves the application for Authority to Establish a bank, the applicant shall be required to submit additional supporting documents and thereafter effect the filing and registration of said documents with the Securities and Exchange Commission. The applicant will then be given a period to complete additional requirements, if there are any.
Following the above procedure, the applicant may begin operating the bank, and within five banking days after the start of operations: (a) inform the BSP of the first day of operation and the banking hours and days; and (b) submit a statement of condition as of the first day of operation.
The authority to establish a bank shall be automatically revoked if the bank is not organized and opened for business within one year after receipt by the organizers from the Monetary Board of the notice of approval of their application.
The establishment of non-bank financial institutions performing quasi-banking functions is governed by the Manual of Regulations for Non-Bank Financial Institutions and its implementing rules and regulations.
The BSP has also adopted a regulatory sandbox framework that applies to entities that intend to offer or use an emerging or new technology to deliver financial products/services pertaining to activities that could fall under the regulatory purview of the BSP. Note, however, that proposed innovations that are determined to be within the scope of existing regulations will be evaluated in accordance with the established registration/licensing regimes.
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1. The statement must be sworn to by the subscriber themselves and duly notarized or certified by a certified public accountant, with schedules detailing cash in banks, securities, real estate, accounts receivable and accounts payable of the subscriber as of a date not earlier than 90 days prior to the filing of application of each of the subscribers.
2. The statement must be sworn to by the subscriber themselves and duly notarized or certified by a certified public accountant.
3. This is the minimum capital requirement for cooperative banks.
4. This is the minimum capital requirement for universal banks. The Monetary Board has different requirements for specialized banks, such as those engaged in micro-finance.