(REPEALED
BY REPUBLIC ACT NO. 6848)
WHEREAS, it is a declared policy of the government to promote and
accelerate the socio-economic growth and development of Mindanao,
particularly, the economically depressed provinces of Cotabato, Lanao
del Sur, Lanao del Norte, Zamboanga del Sur, Zamboanga del Norte and
Sulu;chanroblesvirtualawlibrary
WHEREAS, surveys and studies indicate a pressing need to expand the
banking and credit system in the region to make it more responsive to
the investments and credit requirements of this development program:cralaw:red
WHEREAS, it is further recognized that, ultimately, sustained economic
development will rely heavily on the capabilities of the people in the
region to generate investments through institutional savings:cralaw:red
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers vested in me by the Constitution as
Commander-in-Chief of all the Armed Forces of the Philippines, and
pursuant to Proclamation No. 1081, dated September 21, 1972 and General
Order No. 1, dated September 22, 1972, as amended and in order to
effect the desired changes and reforms in the social, economic and
political structure of our society, do hereby order and decree the
creation of a Philippine Amanah Bank:cralaw:red
ESTABLISHMENT AND FUNCTIONS
Section 1. Purposes, Name and Domicile. — To provide
credit, commercial, development and savings banking facilities at
reasonable terms to the people of the primarily Muslim provinces of
Mindanao, principally, the provinces of Cotabato, South Cotabato, Lanao
del Sur, Lanao del Norte, Sulu, Basilan, Zamboanga del Norte, Zamboanga
del Sur and Palawan for the establishment, acquisition, development and
expansion of agricultural, commercial and industrial enterprises, there
is hereby created a body corporate to be known as the Philippine Amanah
Bank, which shall have its principal places of business at Marawi City
and shall exist for fifty years.
Section 2. Corporate Power. — The Philippine Amanah
Bank shall have the power:cralaw:red
a) to prescribe its by-laws;chanroblesvirtualawlibrary
b) to adopt, alter, and use a corporate seal;chanroblesvirtualawlibrary
c) to make contracts, to sue and be sued;chanroblesvirtualawlibrary
d) to accept savings and time deposits, and open
current or checking accounts;chanroblesvirtualawlibrary
e) to borrow money; to own real or personal property
and to sell, mortgage or otherwise dispose of the same;chanroblesvirtualawlibrary
f) to employ such officers and personnel, preferably
from the Muslim population in Mindanao and Palawan as may be necessary
to carry on its business; chanroblesvirtualawlibrary
g) to establish such branches and agencies in the
dominantly Muslim provinces in Mindanao and Palawan and such
correspondent officers in other areas as may be necessary for the
proper conduct of its business; chanroblesvirtualawlibrary
h) to grant loans for the establishment, acquisition,
development and expansion of any agricultural, commercial and/or
industrial enterprises, including public utilities, mining, livestock
and poultry and fishing, whether off-shore or inland;chanroblesvirtualawlibrary
i) to invest in equities of allied undertakings as
pertinent laws and the Central Bank shall authorize;chanroblesvirtualawlibrary
j) to carry on trust business in accordance with the
provisions of law governing trust corporations;chanroblesvirtualawlibrary
k) to issue bonds, debentures, securities,
collaterals and/or the renewal or refinancing of the same with the
approval of the Central Bank, to be used by the bank in its lending
operations for industrial and agricultural projects that will promote
the economic development of the region;chanroblesvirtualawlibrary
l) to exercise powers granted under this charter and
such incidental powers as may be necessary to carry on its business,
and to exercise further the general powers mentioned in the Corporation
Law and the General Banking Act, as amended in so far as they are not
inconsistent or incompatible with the provisions of this Charter.
Section 3. Authorized Capital Stock. — Par Value. —
The authorized capital stock of the Amanah Bank shall be one hundred
million pesos divided into one million par value shares of one hundred
pesos each. The shares shall be divided into four classes, denominated
as Series "A", Series "B", Series "C", and Series "D". chanroblesvirtualawlibrary
a) series "A" shall comprise thirty million pesos
equivalent to three hundred thousand common shares to be subscribed by
the Government of the Republic of the Philippines;chanroblesvirtualawlibrary
b) series "B" shall comprise twenty million pesos
equivalent to two hundred thousand preferred shares which shall be
subscribed by the government of the Republic of the Philippines, its
agencies or instrumentalities, such shares to be entitled to cumulative
dividends of three per cent per annum and with preference as against
common stockholders in the distribution of assets in the event of
liquidation;chanroblesvirtualawlibrary
c) series "C" shall comprise thirty million pesos
equivalent to three hundred thousand common shares to be subscribed
solely by the citizens of the Philippines and domestic corporations and
entities, seventy per centum of the equity of which is owned by
Citizens of the Philippines. Preference in the subscription of this
class of shares shall be given to residents of the provinces and cities
served or to be served by the bank;chanroblesvirtualawlibrary
d) series "D" shall comprise twenty million pesos
equivalent to two hundred thousand common shares which shall be
available for subscription of foreign nationals, their corporations
and/or associations.
Section 4. Loans and investment authorized. — Said
Amanah Bank is hereby authorized:cralaw:red
a) to purchase or discount promissory notes, drafts
and bills of exchange issued or drawn for agricultural, commercial or
industrial purposes, with securities required by the bank, or the
proceeds of which have been used or are to be used for such purpose;chanroblesvirtualawlibrary
b) to grant loans on or to discount notes secured by
harvested and stored crops; Provided: That no loan on the security of
such harvested and stored crops shall exceed eighty per cent (80%) of
the market value thereof on the date of the loan; Provided, further,
That the crops so mortgaged shall be issued by the mortgagor for the
benefit of the Amanah Bank for their entire market value: and Provided,
finally, That if, owing to circumstance whatever, the value of the
crops given as security shall diminish, the mortgagor shall obligate
himself to furnish further security or refund such part of the loan as
the bank may deem necessary. Such loans shall be granted for a period
of not to exceed one year, subject to extension in the discretion of
the Bank; chanroblesvirtualawlibrary
c) to grant loans to agriculturists, on installments,
for standing crops considered natural products of the Philippines such
as rice, copra, sugar, tobacco, corn, etc., not exceeding seventy per
cent (70%) of the estimated value of such crops; Provided, however,
That before granting such loans, the Amanah Bank may impose as a
condition that cultivation be under supervision and/or require
additional security in the nature of mortgages on real estate duly
registered in the name of the debtor, or chattel mortgage, including
those upon livestock, machinery and agricultural implements, or
personal bonds with sufficient surety or sureties, satisfactory to the
Bank;chanroblesvirtualawlibrary
d) to grant loans to the several provincial, city and
municipal governments and to any other branch or subdivision of the
Republic of the Philippines on promissory notes guaranteed by the
National Government, as known by the endorsement thereon of the
Secretary of Finance, approved by the President of the Philippines or
to purchase bonds lawfully issued by such provincial, city and
municipal governments and any other branches or subdivision of the
Government of the Philippines;chanroblesvirtualawlibrary
e) to grant loans to cooperative associations against
the security of acceptable assets of the cooperative association and/or
the individual members thereof;chanroblesvirtualawlibrary
f) to grant loans to small farmers, merchants and
traders against the security of lands without Torrens title, where the
owner of private property can show five years or more of peaceful,
continuous and uninterrupted possession in the concept of the owner; or
of portions of friar land estates or other lands administered by the
Bureau of Lands that are covered by sales contracts and the purchasers
have paid at least five years installment thereon, without the
necessity of prior approval and consent of the Land Authority or
corresponding governmental agency; or of homesteads or free patent
lands pending the issuance of titles but already approved, the
provisions of any law or regulations to the contrary notwithstanding;
Provided, That when the corresponding titles are issued the same shall
be delivered to the register of deeds of the province where such lands
are situated for the annotation of the encumbrance; Provided, further,
That in the case of lands pending homesteads or free patent titles,
copies of notices for the presentation of the final proof shall also be
furnished the Bank and, if the borrower applicants fail to present the
final proof within thirty days from date of notice, the Bank may do so
for them at their expense; Provided, finally, That the applicant for
homestead or free patent has already made improvements on the land and
the loan applied for is to be used for further development of the same
or for other productive economic activities; chanroblesvirtualawlibrary
g) to grant loans to employees in the government
service or in private industry to acquire stocks in corporations or
industries in an amount not exceeding one month's salary for every year
of service, against the security of the undertaking of the employee
with notice upon the employer for the repayment thereof by monthly
payroll deductions within a period of five years;chanroblesvirtualawlibrary
h) to augment and supplement the capital of the
Amanah Bank, the Development Bank of the Philippines, the Philippine
National Bank and other government financial institutions shall be
permitted to extend loans to the Bank from time to time repayable in an
amortization period and at interest rates that may be agreed upon
against security which may be offered by the Amanah Bank or any
stockholders of the Bank that;chanroblesvirtualawlibrary
1) the said government financial institutions are
convinced that the resources of the Amanah Bank are inadequate to meet
the legitimate credit requirements of the locality wherein the Bank is
established:cralaw:red
2) there is dearth of private capital in the said
locality; and
3) it is possible for the private stockholders to
increase to paid-up capital thereof.
i) the Bank with the approval of the Monetary Board
may rediscount paper with the Central Bank, the Philippine National
Bank or other banks and their branches or agencies. The Central Bank
shall specify the nature of papers deemed acceptable for rediscounting
and the rate to be charged by any such institutions. chanroblesvirtualawlibrary
j) generally, to make advances or discount paper for
agricultural, manufacturing, industrial, or commercial purposes;
Provided, That seventy-five per centum of the loanable funds of the
Bank shall be invested in medium and long-term loans for economic
development purposes and in no case shall the Bank invest more than
twenty-five per centum of its loanable funds in short term loans for
miscellaneous purposes; Provided, however, That twenty- five per cent
(25%) of the loanable funds for short term loans may be loaned on
securities other than real estate mortgage. chanroblesvirtualawlibrary
Section 5. Lending Limits. — Said Amanah Bank shall
observe the following limits in its lending operations:cralaw:red
a) the total liabilities of any person, company,
corporation or firm, excluding loans or credits prescribed by law or by
the Monetary Board as non-risk assets, shall at no time exceed fifteen
per cent (15%) of the unimpaired capital and surplus of the Bank. chanroblesvirtualawlibrary
The total liabilities of any borrower may amount to a further fifteen
per cent (15%) of the unimpaired capital and surplus of the Bank
provided that the additional liabilities are adequately secured by
shipping documents, warehouse receipts or other similar documents
transferring or securing title covering readily marketable, non-
perishable staples which staples must be fully covered by insurance,
and must have a market value equal to at least one hundred and
twenty-five per cent (125%) of such additional liabilities.
The term liabilities as used herein shall mean the direct liability of
the maker or the acceptor of paper discounted with or sold to the Bank
and the liability of the endorser, drawer or guarantor who obtains a
loan from or discounts paper with or sells papers under the guaranty to
the Bank and shall include in the case of the liabilities of a
co-partnership or association the liabilities of the several members
thereof and shall include in the case of the liabilities of a
corporation all liabilities of all subsidiaries thereof in which such
corporation owns or controls a majority interest. But the discount of
bills of exchange drawn in good faith against actually existing values,
and the discount of commercial or business paper actually owned by the
person negotiating the same, shall not be considered as money borrowed,
for the purpose of this section. chanroblesvirtualawlibrary
Loan accommodations granted by the Amanah Bank to any other bank
licensed to do business in the Philippines, shall be subject to the
loan limit to any single borrower as herein prescribed.
b) no director or officer of the Bank shall, either
directly or indirectly, for himself or as the representative or agent
of others, borrow any of the deposits or funds or the Bank, nor shall
he become a guarantor, endorser, or surety for loans from the bank to
others, or in any manner to be an obligor for money borrowed from the
Bank or loaned by it, except with the written approval of the majority
of the directors of the Bank, excluding the director concerned. The
credit accommodation to such director or officer of this Bank which the
Board of Directors may authorize shall in no case exceed his
outstanding depositors or the book value of his paid-in capital in the
Bank. Any such approval shall be entered upon the records of the Bank
and a copy of such entry shall be transmitted forthwith to the
appropriate supervising department of the Central Bank of the
Philippines. The office of any director or officer of the Bank who
violates the provisions of this section shall immediately become vacant
and the director or officer shall be subject to criminal prosecution
and suffer the penalties provided by law.
c) the outstanding credit accommodation which the
Bank may extend to stockholders, other than the Government of the
Republic of the Philippines, its agencies and instrumentalities, owning
more than two per cent (2%) or more of the subscribed capital stock of
the Bank, shall be limited to an amount equivalent to their outstanding
deposits and book value of their paid-in capital contribution in the
Bank.
OFFICERS AND EMPLOYEES
Section 6. Board of Directors. — The affairs and
business of the Amanah Bank shall be directed and its property managed
and preserved unless otherwise provided in this act, by a Board of
Directors consisting of nine (9) members duly elected as hereinafter
provided, who shall for each session of the Board attended by them, be
paid a per diem in such amount as the Board of Directors may fix.
Section 7. Election of Board of Directors. — Annually
on the first Monday in March, the stockholders shall meet to elect the
members of the Board of Directors for the current year, each
stockholder or proxy to be entitled to as many votes as he may have
shares of stock, registered in his name on the fifteenth of February
last preceding and held by him at the time of the election. Immediately
after the election, the directorate shall organize as such and elect
from amongst themselves a chairman, a vice-chairman who shall assist
the chairman and act in his stead in case of absence or incapacity of
the chairman. In case of incapacity or absence of both, the chairman
and/or vice-chairman of the Board of Directors shall designate a
temporary chairman from among its members: Provided, That no director,
shareholder or employee of any other bank shall be eligible as member
of the Board of Directors: Provided, further, That no full-time
appropriative or elective public official shall at the same time serve
as officer, director, legal counsel or consultant of the Bank except in
cases where such service is in the exercise of the stockholders right
of the government or is incident to financial assistance provided by
the Government, its agencies or instrumentalities to the Bank.
Section 8. The Board of Directors shall, among other
duties, powers, and authority:cralaw:red
a) formulate policies necessary to carry out
effectively the provisions of this Charter and adopt such by-laws,
rules and regulation for the effective operation of the Bank, in
conformity with this Act and existing laws; and chanroblesvirtualawlibrary
b) establish, upon previous authority of the Central
Bank, branches, agencies or offices in other countries and at such
points within the Philippines, as it may deem advisable, which shall
perform functions as may be delegated to them by the Board of Directors.
Section 9. The Amanah Bank shall have the following
officers: a president, one or more vice-presidents, a secretary, a
treasurer, an auditor and a legal counsel who shall be chosen by the
Board of Directors, their tenure of office and compensation shall be
determined by the Board of Directors. In making these appointments,
preference shall be given to members of the cultural minorities.
Section 10. Duties and powers of the President. — The
President of the Bank shall, among others, execute and administer the
policies, measures, orders and resolutions approved by the Board of
Directors and direct and supervise the operation and administration of
the Bank.
Particularly, he shall have the power and duty:cralaw:red
a) to make loans on commercial paper for periods of
time not to exceed four months in sums not exceeding fifty thousand
pesos to any one person, company, corporation or firm, but he is
required to submit a report on each such loan to the Board of Directors
at the next succeeding session.
b) to make, with the advices and consent of the Board
of Directors, all contracts on behalf of the said Bank and to enter
into all necessary obligations by this charter required or permitted.
c) to report weekly to the Board of Directors and
main facts concerning the operations of the bank during the preceding
week and to suggest changes in the rates of discount, exchange, or of
policy which may to him seem best. chanroblesvirtualawlibrary
Section 11. Other Officers and Employees. — All other
officers and employees of the Bank shall be appointed and removed by
the Board of Directors, on recommendation of the President. In making
appointments, members of the cultural minorities shall be given
preference. Said officers and employees shall not be subject to the
Civil Service Law, and their duties and compensation shall be fixed by
the President with the approval of the Board of Directors.
Section 12. Fidelity Bond for Officers and Employees.
— The Board of Directors may require the officers and employees of the
Bank and its branches, before entering upon the performance of their
duties, to furnish a fidelity bond for the benefit of the Bank, in the
form and amount prescribed by the said Board of Directors.
Section 13. Project Development Office. — The Amanah
Bank shall have a project Development Office which shall be responsible
for the following:cralaw:red
a) conduct periodic economic surveys and studies of
the investment climate and opportunities in the Bank's sphere of
operations and identify the viable projects which may be sponsored by
the people in the region;chanroblesvirtualawlibrary
b) offer technical consultancy services in the
preparation of project studies and in meeting other technical credit
requirements of the Bank, including the provision of management
consultants at rates to be determined by the Board of Directors to
projects financially assisted by the Bank;chanroblesvirtualawlibrary
c) evaluate each proposal for possible financing by
the Bank.
Section 14. Auditing Office. — The auditing Office of
the Bank shall be headed by a representative of the Auditor General.
All the other employees of the Office shall be appointed by the
Directors of the Bank. The operating expenses, salaries and travel
expenses of the employees of the Office shall be payable by the Bank,
and the Board of Directors shall make the necessary appropriations
therefor. The representative of the Auditor General shall make a
quarterly report on the condition of the Bank to the President of the
Philippines through the Secretary of Finance, to the Auditor General
and to the Board of Directors of the Bank. The report shall contain
among others a statement of the resources and liabilities, including
earnings and expenses, the amount of capital, stock, dividends paid,
surplus reserve, and undivided profits, as well as the losses, bad
debts and suspended and overdue paper carried in the Bank's assets as
of the day in which the statements are complied.
MISCELLANEOUS PROVISIONS
Section 15. Government Shares. — The voting power of
a stock of the Amanah Bank owned and controlled by the Republic of the
Philippines shall be vested in the President of the Philippines, or in
such persons as he may from time to time duly designate.
The stockholdings of the government in common or preferred shares with
the Amanah Bank, or any part thereof, may be sold at par value at any
time to citizens of the Philippines who are registered stockholders of
the Amanah Bank in proportion to their respective holdings. They shall
have a period of one year from the date of the offer to sell by the
government within which to exercise this right. In the absence of such
buyers, preference shall be given to Philippine citizens who are
residents of the provinces served by the Bank before the shares of
stock may be publicly offered by listing in the stocks at any stock
exchange.
All profits assigned as dividends to the shares of the government shall
first be applied in payment to the unpaid subscriptions of the
Government. Upon full payment of such subscriptions, the dividends
shall thereafter be paid into the Treasury of the Philippines for the
general funds thereof.
Section 16. Government Assistance on Documentation
and Registration. — Any city or municipal judge in his capacity as
notary public ex-officio, shall administer oath to or act upon the
instruments of the Amanah Bank, its borrowers or mortgagors free from
all charges, fees, and documentary stamp tax, collectible under
existing laws, relative to any loans or transaction not exceeding five
thousand pesos.
Any Register of Deeds shall accept from the Amanah Bank and its
borrowers or mortgagors for registration free from all charges, fees,
and documentary stamp collectible under existing laws, any instrument,
whether voluntary or involuntary, relating to loans or transactions
extended by the Bank in an amount not exceeding five thousand pesos:
Provided, however, That charges, if any, shall only be collectible on
the amount in excess of five thousand pesos; and that in instruments
related to assignments of several mortgages consolidated in a single
deed, charges or fees, if any, shall be levied only on the amount in
excess of five thousand pesos of the consideration in the assignment of
each mortgage.
Section 17. Prohibition. — No member of the Board of
Directors, officers, attorney, agent or employee of the Bank shall in
any manner, directly or indirectly participate in the deliberations
upon the determination of any question affecting his personal interest,
or the interests of any corporation, partnership, or association in
which he is directly or indirectly interested. Any persons violating
the provisions of this section shall be summarily removed from
office. chanroblesvirtualawlibrary
No fee, commission, gift or charge of any kind shall be exacted,
demanded or paid to any director, employee or agent of the Bank for
obtaining loans from the Bank, and any director, officer, employee or
agent of the Bank exacting, demanding or receiving any fee for services
in obtaining a loan shall be summarily removed from office.
Section 18. Supervision/Inspection by the Central
Bank. — The Amanah Bank shall be subject to examination and supervision
of the Central Bank pursuant to applicable laws, and shall contribute
to the Central Bank an annual fee to help defray the cost of
maintaining the appropriate supervising department within the Central
Bank in an amount to be determined by the monetary Board but in no case
to exceed one twentieth of one per cent (1/20 of 1%) of its total
assets during the preceding year, as shown on its end-on-month balance
sheets, after deducting its cash on hand and amounts due banks,
including the Central Bank.
Section 19. Confidential Information. — The Governor,
Central Bank, officers of the Central Bank and other officials as may
be designated by law or regulations of the Monetary Board to examine
the books for the Amanah Bank shall not reveal the results of any
examination conducted by them to any person, government official,
bureau or office other than the Monetary Board and the Board of
Directors of the Amanah Bank. The reports and other papers relative to
such examination shall not be opened to the public except only in so
far as such publicity is necessary for the prosecution of violation in
connection with the business of the Amanah Bank or is incidental to
proceedings upon insolvency or persistent violation of law and
regulations.
Section 20. Secrecy of Deposits. — All deposits of
whatever nature with the Amanah Bank, including investments in bonds
issued by the government of the Philippines, its political subdivisions
and its instrumentalities, are hereby considered as of an absolutely
confidential nature and may not be examined, inquired, or looked into
by any person, government official, bureau or office except upon
written permission the depositor, or in cases of impeachment, or upon
order of a competent court in cases where the money deposited or
invested is the subject matter of the litigation.
It shall be unlawful for any official or employee of the Amanah Bank to
disclose to any person other than those mentioned above any information
concerning said deposits.
Section 21. Repealing Clause. — Any law or part of
law inconsistent with the provisions of this Charter is hereby repealed.
Section 22. This Decree shall take effect
immediately. chanroblesvirtualawlibrary
Done in the City of Manila,
this 2nd day of August, in the year of Our Lord, nineteen hundred and
seventy-three.
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