Guidelines on the Change or Transfer of Depository Bank/Bank Branch/Current Account for the Internal Revenue Allotment (IRA) of Local Government Units (LGUs) per Local Budget Circular No. 77, Dated December 2, 2003, of the Department of Budget and Management (DBM)

February 14, 2012 BLGF MEMORANDUM CIRCULAR NO. 021-12 TO : The Regional Directors of this Bureau; Local Treasurers of Metro Manila; Provincial, City, and Municipal Treasurers; and All Others Concerned SUBJECT : Guidelines on the Change or Transfer of Depository Bank/Bank Branch/Current Account for the Internal Revenue Allotment (IRA) of Local Government Units (LGUs) per Local Budget Circular No. 77, Dated December 2, 2003, of the Department of Budget and Management (DBM) For the information and guidance of all concerned, hereunder quoted are the guidelines on the change or transfer of depository bank/bank branch/current account for the IRA of LGUs as provided for under DBM Local Budget Circular No. 77, dated December 2, 2003: "2.0 Guidelines 2.1. Requests of LGUs for change or transfer of depository bank/bank branch/current account for IRA purposes shall be directly submitted to the Department of Budget and Management-Regional (DBMROS) concerned for final action. 2.1.1. Request for such change/transfer made by a bank branch or any other party instead of the LGU concerned, shall not be considered. 2.2. LGUs shall only be allowed such change/transfer under the following conditions: 2.2.1. the change/transfer is duly authorized by the local sanggunian ; HTASIa 2.2.2. LGUs which have outstanding contractual obligations with their present depository banks, shall not request for transfer of their account to another bank unless the LGU concerned gets prior clearance from its present depository bank; 2.2.3. the transfer of depository bank shall be limited to authorized government servicing banks (GSBs) under the Modified Disbursement Scheme (MDS) such as, the Land Bank of the Philippines (LBP), Development Bank of the Philippines (DBP) and Philippine Veterans Bank (PVB). 2.3. Requests for transfer of IRA depository accounts to the Philippine National Bank (PNB) shall no longer be considered. However, LGUs shall be allowed to transfer, on their own, local funds from LBP, DBP and PVB, as the case may be to PNB to comply with the loan arrangements with the said bank, provided that the same is supported by a duly approved sanggunian resolution. 2.4. Requests of LGUs for change or transfer of depository bank/bank branch/current account shall be supported with the following documents: 2.4.1 A certified true copy of the sanggunian resolution authorizing the LGU to change or transfer its IRA depository bank/bank branch/current account; 2.4.2 Name of new servicing bank, location and bank account number; and 2.4.3 Clearance from present depository bank branch allowing the transfer, in case the LGU has an outstanding loan/contractual obligation with the said bank. 2.5. Change of depository bank shall be approved and implemented only at the beginning of each calendar year. cHESAD 2.6. Transfer of IRA depository account from one bank branch to another branch of a particular GSB and change of current account within the same depository bank shall be approved on a quarterly basis. 2.7. To give DBMROs sufficient time for evaluation/processing and for effective changes in their respective IRA database, the LGUs are enjoined to observe the following deadlines in the submission of their requests to DBMROs concerned: Particulars Deadline for Effectivity of submission by approval LGUs For change or transfer On or before December Beginning of the of depository bank/ 7 of the current year following year bank branch in the ensuing calendar year For transfer to another On or before the 7th day Beginning of the bank branch of the of the last month of the following quarter same GSB/change of current quarter current account within the same bank branch for the ensuing quarter 2.8. LGUs are advised not to close their existing current account until such time that the LGU concerned has received the approval of the DBMRO on the proposed transfer/change." 3.0 Responsibility of Local Chief Executives The Provincial Governors, City and Municipal Mayors and Punong Barangays concerned shall be held personally liable for any change or transfer of depository bank/bank branch/current accounts, which is not in accordance with this Circular." All concerned are hereby enjoined to follow the foregoing guidelines on the aforecited subject with the prior approval of the Secretary of Finance to open depository accounts of LGUs. The Regional Directors of this Bureau are hereby instructed to disseminate this issuance to all Provincial, City and Municipal Treasurers within their respective regional jurisdiction, who in turn, are likewise hereby directed to provide a copy for their respective Provincial Governors, City and Municipal Mayors and others concerned. Be guided accordingly. SEDICa (SGD.) SALVADOR M. DEL CASTILLO OIC-Executive Director ATTACHMENT DEPARTMENT OF BUDGET AND MANAGEMENT DBM LOCAL BUDGET CIRCULAR NO. 077-03 December 2, 2003 TO : Provincial Governors; City and Municipal Mayors; Barangay Chairmen; Sangguniang Panlalawigan/Panlungsod/Bayan/Barangay; Provincial/City/Municipal Treasurers; Regional Directors of the Department of Budget and Management; and all Others Concerned SUBJECT : Amending the Guidelines on Change or Transfer of Depository Bank/Bank Branch/Current Account for Internal Revenue Allotment (IRA) of Local Government Units (LGUs) 1.0 Purpose 1.1. To amend the provisions of Local Budget Memorandum (LBM) Nos. 2001-35 and 2002-38 dated February 27, 2001 and April 5, 2002, respectively, relative to the change or transfer of depository bank/bank branch of local government units (LGUs) for Internal Revenue Allotment (IRA). 2.0 Guidelines 2.1. Requests of LGUs for change or transfer of depository bank/bank branch/current account for IRA purposes shall be directly submitted to the Department of Budget and Management-Regional Offices (DBMROs) concerned for final action. 2.1.1. Request for such change/transfer made by a bank branch or any other party instead of the LGU concerned, shall not be considered. 2.2. LGUs shall only be allowed such change/transfer under the following conditions: 2.2.1. the change/transfer is duly authorized by the local sanggunian; 2.2.2. LGUs which have outstanding contractual obligations with their present depository banks, shall not request for transfer of their account to another bank unless the LGU concerned gets prior clearance from its present depository bank; 2.2.3. the transfer of depository bank shall be limited to authorized government servicing banks (GSBs) under the Modified Disbursement Scheme (MDS) such as, the Land Bank of the Philippines (LBP), Development Bank of the Philippines (DBP) and Philippine Veterans Bank (PVB). 2.3. Requests for transfer of IRA depository accounts to the Philippine National Bank (PNB) shall no longer be considered. However, LGUs shall be allowed to transfer, on their own, local funds from LBP, DBP and PVB, as the case may be to PNB to comply with the loan arrangements with the said bank, provided that the same is supported by a duly approved sanggunian resolution. 2.4. Requests of LGUs for change or transfer of depository bank/bank branch/current account shall be supported with the following documents: 2.4.1. A certified true copy of the sanggunian resolution authorizing the LGU to change or transfer its IRA depository bank/bank branch/current account; 2.4.2. Name of new servicing bank, location and bank account number; and 2.4.3. Clearance from present depository bank branch allowing the transfer, in case the LGU has an outstanding loan/contractual obligation with the said bank. 2.5. Change of depository bank shall be approved and implemented only at the beginning of each calendar year. 2.6. Transfer of IRA depository account from one bank branch to another branch of a particular GSB and change of current account within the same depository bank shall be approved on a quarterly basis. 2.7. To give DBMROs sufficient time for evaluation/processing and for effecting changes in their respective IRA database, the LGUs are enjoined to observe the following deadlines in the submission of their requests to DBMROs concerned: Deadline for Effectivity of Particulars Submission Approval by LGUs For change or transfer of On or before December 7 Beginning of depository bank/bank of the current year the following year branch in the ensuing calendar year For transfer to another bank On or before the 7th day Beginning of branch of the same GSB/ of the last month of the the following change of current account current quarter quarter within the same bank branch for the ensuing quarter 2.8. LGUs are advised not to close their existing current account until such time that the LGU concerned has received the approval of the DBMRO on the proposed transfer/change. EHTIcD 3.0 Responsibility of Local Chief Executives The Provincial Governors, City and Municipal Mayors and Punong Barangays concerned shall be held personally liable for any change or transfer of depository bank/bank branch/current accounts, which is not in accordance with this Circular. 4.0 Repealing Clause All provisions of existing issuances inconsistent with this Circular including LBM Nos. 35 and 38, are hereby rescinded/repealed and/or modified accordingly. 5.0 Effectivity This Circular shall take effect immediately. (SGD.) EMILIA T. BONCODIN Secretary