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BSP to standardize bank fees, penalties |
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By LEE C. CHIPONGIAN
The Manila Bulletin 08/23/2005 The Bangko Sentral ng Pilipinas will standardize fees and penalties charged to erring banks and make it more consistent and "equalized" depending on the intensity of the violation and size of the banks. A senior BSP official said the main bone of contention in the Monetary Board discussion is differentiating penalties for big commercial banks versus the smaller capitalized banks, such as thrift and rural banks. Under the present law, big banks pay the same amount as the smaller banks per violation per day, which is only P30,000. "We need to differentiate the rates for the big and smaller banks," the source said. "Big banks should be paying more." "The law says P30,000 per violation per day, but the MB has to impose changes and to determine the intensity of the violation and most especially the size of the banks (which will be penalized)," the BSP official said. At the moment the central bank’s policy-making body the MB are still stuck on the interpretation of the law under the New Central Bank Act of 1993. There have been proposals in the past to raise penalties to a maximum of P500, 000 from P30,000 per violation and other proposed amendments to allow the BSP more teeth in exercising its regulatory powers. Since the penalties are so small, say for the larger banks, the banks just commit the violation and pay the measly fines of P30,000. Banks usually commit "violations" in their purchase of US dollars. Several BSP circulars prohibit Philippine residents from buying dollars on the spot market if they would use it to buy dollar-denominated Philippine government bonds. The BSP would usually impose rules or tighten monetary policy, maybe use stronger moral suasion to discourage banks and investors from buying dollars. The central bank wants the proposed maximum penalty to be imposed also on reserve-deficient banks or to banks exceeding loan exposure to directors, officers, stockholders and related interests. |
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