BSP Circular No. 201-99

May 1, 1999 BSP CIRCULAR NO. 201-99 To align with policy issuances under Circular No. 161 (Investments in all Debt Securities and Marketable Equity Securities), Circular No. 164, as amended (General Loan Loss Provision) and Circular No. 169 (Restructured Loans), the Monetary Board, in its Resolution No. 442 dated April 12, 1999, approved to amend the Manual of Accounts issued under Circular No. 108 on May 9, 1996 and related report forms of expanded and non-expanded commercial banks (EKBs and NEKBs). To assist banks in complying with these amendments, revised report forms are hereby circularized and banks are required to: 1. Immediately adopt the revisions to the Manual of Accounts for EKBs and NEKBs as contained in Annex A. 2. Adopt the following revised existing reports as contained in Annex B: No. Report Title Initial Reporting Period Covered Scheduled Date of Transmission/ 1 Consolidated Statement of Condition (CSOC) Main Report and Schedules 3, Month ended June 30, 1999 July 21, 1999 4, 4A, 9 and 10 2 Consolidated Daily Report of Condition Week from (CDRC) Main Report June 25, 1999 to July 01, 1999 July 6, 1999 3 Consolidated Statement of Income and Expenses and Surplus Free (CSIE) Quarter ended June 30, 1999 July 21, 1999 4 Statement of Condition (SOC) Main Report (By Banking Unit) Quarter ended June 30, 1999 July 21, 1999 5 Statement of Income and Expenses (SIE) By Banking Unit Quarter ended June 30, 1999 July 21, 1999 Note: Succeeding submissions of above reports shall be made in accordance with the schedule indicated in Appendix 6-A of the Manual of Regulations for Banks 3. Immediately adopt the revisions (Annex C) to the Manual of Unified Reports issued under Circular No. 108: No. Report Title 1 General Ledger Template 2 Trust Account Template 3 Investments Subsidiary Ledger 4. Adopt the standard data structures (Annex D) in the implementation of Stage 3 of the GL/SL type of reporting. (SGD.) GABRIEL C. SINGSON Governor COMMERCIAL BANKS ANNEX A KB Revision to MANUAL OF ACCOUNTS for EXPANDED COMMERCIAL BANKS and COMMERCIAL BANKS MANUAL OF ACCOUNTS GL ACCT CODE ACCOUNT TITLE ASSET ACCOUNTS 1-2-16-00 12 RESTRUCTURED LOANS 1-2-16-02 a. Restructured Loans Restructured Loans Fully Secured Restructured Loans Unsecured or Partially Secured 1-2-16-04 b. Past Due Restructured Loans 1-2-16-06 c. Items in Litigation Restructured Loans 2-7-16-00 d. Allowance for Probable Losses Restructured Loans 1-2-18-00 13 UNDERWRITING ACCOUNTS (UA)-DEBT SECURITIES for EKBs 1-2-18-02 a. Underwritten Debt Securities Purchased 1-2-18-03 b. Accumulated Market Gains/(Losses) Underwritten Debt Securities Purchased 1-2-18-04 c. Receivables Underwritten Debt Securities Sold 1-2-20-00 14 TRADING ACCOUNT SECURITIES (TAS) LOANS 1-2-20-02 a. Government Securities Purchased under Resale Agreements 1-2-20-04 b. Government Securities Purchased under Certificates of Assignment/Participation with Recourse 1-2-20-06 c. Government Securities Purchased under Reverse Repurchase Agreements with the BSP 1-2-20-08 d. Private Debt Securities/Commercial Papers (CPs) Purchased 1-2-20-10 e. Private Debt Securities/Commercial Papers Purchased under Resale Agreements 1-2-20-12 f. Private Debt Securities/Commercial Papers Sold under Repurchase Agreements 1-2-20-14 g. Private Debt Securities/Commercial Papers Purchased under Certificates of Assignments/Participation with Recourse 2-7-80-00 14.a GENERAL LOAN LOSS PROVISION 1-3-10-00 14.b UNDERWRITING ACCOUNTS (UA) EQUITY SECURITIES for EKBs 1-3-10-02 a. Underwritten Equity Security Purchased 1-3-10-04 b. Accumulated Market Gains/(Losses) Underwritten Equity Securities Purchased 1-3-10-06 c. Receivables Underwritten Equity Securities Sold 1-3-20-00 15 TRADING ACCOUNT SECURITIES (TAS) INVESTMENTS 1-3-20-02 a. Government Securities Purchased Government Securities Purchased Local Currency Government Securities Purchased Foreign Regular Government Securities Purchased FCDU/EFCDU 1-3-20-04 b. Government Securities Sold Under Repurchase Agreements Government Securities Sold Under Repurchase Agreements Local Currency Government Securities Sold Under Repurchase Agreements Foreign Regular Government Securities Sold Under Repurchase Agreements FCDU/EFCDU 1-3-30-00 15.a TRADING ACCOUNT SECURITIES (TAS) EQUITY for EKBs Trading Account Securities Equity Local Currency Trading Account Securities Equity Foreign Regular 1-3-40-00 15.b AVAILABLE FOR SALE SECURITIES (ASS) 1-3-40-02 a. Available for Sale Securities Government Available for Sale Securities Reserve Purposes Available for Sale Securities Guarantee for Trust Functions/Duties Available for Sale Securities Others 1-3-40-04 Accumulated Market Gains/(Losses)-ASS Government Issue 1-3-40-06 b. Available for Sale Securities Private 1-3-40-08 Accumulated Market Gains/(Losses)-ASS-Private Issue 1-3-40-10 c. Available for Sale Securities Foreign Available for Sale Securities Foreign Regular - Available for Sale Securities FCDU/EFCDU 1-3-40-12 Accumulated Market Gains/(Losses) ASS Foreign Accumulated Market Gains/(Losses) ASS Foreign Regular Accumulated Market Gains/(Losses) ASS FCDU/EFCDU 1-3-50-00 16 INVESTMENT IN BONDS & OTHER DEBT INSTRUMENTS (IBODI) 1-3-50-02 a. IBODI Government IBODI Reserve Purposes IBODI Guarantee for Trust Functions/Duties IBODI Others 1-8-50-02 Accumulated Bond Discount IBODI-Government Issue 2-8-50-02 Accumulated Premium Amortization IBODI- Government Issue 1-3-50-04 b. IBODI Private 1-8-50-04 Accumulated Bond Discount IBODI-Private Issue 2-8-50-04 Accumulated Premium Amortization IBODI Private Issue 1-3-50-06 c. IBODI Foreign IBODI Foreign Regular IBODI FCDU/EFCDU 1-8-50-06 Accumulated Bond Discount IBODI-Foreign 2-8-50-06 Accumulated Premium Amortization IBODI- Foreign Accumulated Bond Discount IBODI-Foreign Regular Accumulated Premium Amortization IBODI- Foreign Regular Accumulated Bond Discount IBODI FCDU/EFCDU Accumulated Premium Amortization IBODI FCDU/EFCDU 2-8-50-00 d. Allowance for Probable Losses IBODI Allowance for Probable Losses IBODI Domestic Allowance for Probable Losses IBODI Foreign Regular Allowance for Probable Losses IBODI FCDU/EFCDU 1-3-60-00 17 EQUITY INVESTMENTS 1-3-60-02 a. Equity Investments in Allied Undertakings Equity Investments in Financial Allied Undertakings Domestic Equity Investments in Non-Financial Allied Undertakings Domestic Equity Investments in Financial Allied Undertakings Aboard (for EKBs) Equity Investments in Non-financial Allied Undertakings Abroad (for EKBs) 1-3-60-04 b. Equity Investments in Non-Allied Undertakings (for EKBs) Equity Investments in Non-Allied Undertakings- Domestic (for EKBs) Equity Investments in Non-Allied Undertakings- Abroad (for EKBs) 2-8-60-00 c. Allowance for Probable Losses Equity Investments 1-4-02-00 18 DUE FROM HEAD OFFICE/BRANCHES/AGENCIES 1-4-02-02 a. Due from HO/Branches/Agencies in the Philippines 1-4-02-04 b. Due from HO/Branches/Agencies in the Philippines FCDU/EFCDU 1-4-02-06 c. Due from HO/Branches/Agencies Abroad Regular 1-4-02-08 d. Due from HO/Branches/Agencies Abroad FCDU/EFCDU 1-4-02-10 e. Due from HO/Branches/Agencies Aboard Assigned Capital 1-4-04-00 19 BANK PREMISES, FURNITURE, FIXTURES AND EQUIPMENT 1-4-04-02 a. Bank Premises Land 1-4-04-04 b. Bank Premises Building under Construction 1-4-04-06 c. Bank Premises Buildings 2-9-04-06 d. Accumulated Depreciation Bank Premises Buildings 1-4-04-08 e. Bank Premises Appraisal Increment Buildings 2-9-04-08 f. Accumulated Depreciation Bank Premises Appraisal Increment Buildings MISSING PAGES VI TO IX GL ACCT CODE ACCOUNT TITLE LIABILITY ACCOUNTS 2-3-04-00 29 DUE TO LOCAL BANKS 2-3-04-02 a. Due to Local Banks Private 2-3-04-04 b. Due to Local Banks Government 2-3-04-06 c. Due to Local Banks Clearing Accounts Due to Local Banks Local Clearing Due to Local Banks FX Clearing 2-3-06-00 30 DUE TO FOREIGN BANKS (LOCAL CURRENCY) 2-3-08-00 31 DUE TO HEAD OFFICE/BRANCHES/AGENCIES 2-3-08-02 a. Due to HO/Branches/Agencies in the Philippines 2-3-08-04 b. Due to HO/Branches/Agencies in the Philippines FCDU/EFCDU 2-3-08-05 c. Due to HO/Branches/Agencies Abroad (Local Currency) 2-3-08-06 d. Due to HO/Branches/Agencies Abroad - Regular 2-3-08-08 e. Due to HO/Branches/Agencies Abroad FCDU/EFCDU 2-3-08-10 f. Due to HO/Branches/Agencies Abroad Assigned Capital 2-3-10-00 32 TREASURER'S/CASHIER'S/MANAGER'S AND GIFT CHECKS 2-3-12-00 33 PAYMENT ORDERS PAYABLE Payment Orders Payable Domestic Payment Orders Payable Foreign Regular Payment Orders Payable FCDU/EFCU 2-3-14-00 34 MARGIN DEPOSITS Margin Deposits Domestic Letters of Credit Margin Deposits Import Letters of Credit (Local Currency) Margin Deposits Import Letters of Credit Foreign Regular Margin Deposits Customers' Liability on Bills/Drafts under Letters of Credit and/or Trust Receipts Margin Deposits Foreign Margin Deposits Others 2-3-16-00 35 CASH LETTERS OF CREDIT Cash Letters of Credit Domestic Cash Letters of Credit Foreign Regular 2-3-18-00 36 SPECIAL TIME DEPOSITS 2-3-20-00 37 ACCRUED INTEREST, TAXES AND OTHER EXPENSES PAYABLE 2-3-20-02 a. Accrued Interest Payable Accrued Interest Payable Domestic Accrued Interest Payable Foreign Regular Accrued Interest Payable FCDU/EFCDU 2-3-20-03 b. Accrued Fringe Benefits Payable 2-3-20-04 c. Accrued Fringe Benefits Tax Payable 2-3-20-05 d. Accrued Income Tax Payable 2-3-20-06 e. Accrued Other Taxes and Licenses Payable 2-3-20-08 f. Accrued Other Expenses Payable Accrued Other Expenses Payable Domestic Accrued Other Expenses Payable Foreign Regular Accrued Other Expenses Payable FCDU/EFCDU 2-3-22-00 38 DUE TO BANGKO SENTRAL NG PILIPINAS (BSP) 2-3-22-02 Due to BSP Banking Fees 2-3-22-04 Due to BSP Others 2-3-24-00 39 DUE TO PHILIPPINE CROP INSURANCE CORP. (PCIC) 2-3-26-00 40 UNEARNED INCOME AND OTHER DEFERRED CREDITS 2-3-26-02 a. Unearned Interest and Discount Unearned Interest and Discount Domestic Unearned Interest and Discount Foreign Regular Unearned Interest and Discount FCDU/EFCDU 2-3-26-04 b. Unearned Income Call/Put Option Premium Unearned Call/Put Option Premium Foreign Regular Unearned Call/Put Option Premium FCDU/EFCDU 2-3-26-06 c. Unrealized Profits on Assets Sold/Exchanged 2-3-26-08 d. Capitalized Interest and Other Charges Restructured Loans 2-3-26-10 e. Advanced Rentals on Bank Premises &/or Equipment 2-3-26-12 f. Advanced Rentals on Safe Deposits Boxes 2-3-26-14 g. Deferred Hedging Gain/(Loss) Deferred Hedging Gain/(Loss) Foreign Regular Deferred Hedging Gain/(Loss) FCDU/EFCDU 2-3-26-16 h. Other Deferred Credits 2-3-28-00 41 OUTSTANDING ACCEPTANCES EXECUTED BY OR FOR ACCOUNT OF THIS BANK Outstanding Acceptances Domestic Outstanding Acceptances Foreign Copied verbatim from documents directly obtained from the Bangko Sentral ng Pilipinas . GL ACCT CODE ACCOUNT TITLE CAPITAL ACCOUNTS 3-1-02-00 43 CAPITAL STOCK 3-1-02-02 a. Preferred Capital Stock Subscribed 3-1-02-04 b. Preferred Capital Stock Subscriptions Receivable 3-1-02-06 c. Preferred Capital Stock Paid-in 3-1-02-08 d. Common Capital Stock Subscribed 3-1-02-10 e. Common Capital Stock Subscriptions Receivable 3-1-02-12 f. Common Capital Stock Paid-in 3-1-02-14 g. Stock Dividends Distributable 3-2-02-00 44 SURPLUS 3-2-02-02 a. Paid-in Surplus 3-2-02-04 b. Surplus Free 3-2-04-00 45 SURPLUS RESERVES 3-2-04-02 a. Reserve for Trust Business 3-2-04-04 b. Reserve for Self-Insurance 3-2-04-06 c. Reserve for Contingencies 3-2-04-08 d. Other Surplus Reserves 3-3-02-00 46 UNDIVIDED PROFITS Undivided Profits Undivided Profits FCDU/EFCDU 3-3-03-00 46.a NET UNREALIZED GAINS/(LOSSES) ON SECURITIES AVAILABLE FOR SALE Net Unrealized Gains/(Losses) on Securities Available For Sale Local Currency Net Unrealized Gains/(Losses) on Securities Available For Sale Foreign Regular Net Unrealized Gains/(Losses) on Securities Available for Sale FCDU/EFCDU 3-3-04-00 47 APPRAISAL INCREMENT RESERVE 3-3-06-00 48 ASSIGNED CAPITAL (FOREIGN BANKS) MISSING PAGES XIV TO XVII GL ACCT CODE ACCOUNT TITLE INCOME ACCOUNTS 5-0-02-00 75 INTEREST INCOME 5-0-02-02 a. Interest Income Interbank Loans Receivable Interest Income Interbank Call Loans Receivable Interest Income Interbank Term Loans Receivable Interest Income Interbank Term Loans Receivable Interest Income Interbank Term Loans Receivable Foreign Regular Interest Income Interbank Term Loans Receivable FCDU/EFCDU Interest Income Interbank Term Loans Receivable Local Bank FCDU/EFCDU 5-0-02-04 b. Interest Income Loans and Discounts Discounts Earned Interest Income Demand Loans Interest Income Time Loans Interest Income Mortgage Contract Receivable Interest Income Loans and Discounts DOSRI Interest Income Loans and Discounts Officers and Employees Interest Income Foreign Interest Income Loans and Discounts Foreign Regular Interest Income Loans and Discounts FCDU/EFCDU 5-0-02-06 c. Interest Income Agrarian Reform/Other Agricultural Credits 5-0-02-08 d. Interest Income Development Incentive Loans 5-0-02-10 e. Interest Income Bills Purchased Interest Income Bills Purchased Domestic Interest Income Bills Purchased Foreign Regular Interest Income Bills Purchased FCDU/EFCDU 5-0-02-12 f. Interest Income Import and Domestic Bills under Letter of Credit and/or Trust Receipts 5-0-02-14 g. Interest Income Restructured Loans 5-0-02-16 h. Interest Income Past Due Items/Items in Litigation 5-0-02-18 i. Interest Income Trading Account Securities (TAS) Loans 5-0-02-20 j. Interest Income Deposits in Banks Interest Income Deposits in Local Banks Interest Income Deposits in Local Banks Interest Income Deposits in Local Banks FCDU/EFCDU Interest Income Deposits in Foreign Banks Interest Income Deposits in Foreign Banks Interest Income Deposits in Foreign Banks FCDU/EFCDU 5-0-02-22 k. Interest Income Due from BSP Interest Income Due from BSP Local Currency Interest Income Due from BSP Local Currency Regular Interest Income Due from BSP Local Currency FCDU/EFCDU Interest Income Due from BSP Foreign Currency Interest Income Due from BSP Foreign Currency Regular Interest Income Due from BSP Foreign Currency FCDU/EFCDU 5-0-02-24 l. Interest Income Trading Account Securities (TAS) Investments Interest Income TAS Investments Local Currency Interest Income Tax Exempt TAS Investments Interest Income Taxable TAS Investments Interest Income TAS Investments Foreign Regular Interest Income TAS Investments FCDU/EFCDU 5-0-02-25 l.a Interest Income Available for Sale Securities (ASS) Interest Income ASS Local Currency Interest Income Tax Exempt ASS Interest Income Taxable ASS Interest Income ASS Foreign Regular Interest Income ASS FCDU/EFCDU 5-0-02-26 m. Interest Income IBODI Interest Income IBODI Local Currency Interest Income Tax Exempt IBODI Interest Income Taxable IBODI Interest Income IBODI Foreign Regular Interest Income IBODI FCDU/EFCDU 5-0-02-40 n. Interest Income Others 5-0-04-00 76 BANK COMMISSIONS 5-0-06-00 77 SERVICE CHARGES/FEES 5-0-08-00 78 FEES/COMMISSIONS 5-0-10-00 79 TRADING GAIN/(LOSS) Trading Gain/(Loss) Government Securities Trading Gain/(Loss) Government Securities Local Currency Trading Gain/(Loss) Government Securities Foreign Currency Trading Gain/(Loss) Government Securities Foreign Regular Trading Gain/(Loss) Government Securities FCDU/EFCDU Trading Gain/(Loss) Private Debt Securities/Commercial Papers/Equity Securities Trading Gain/(Loss) Private Debt Securities/Commercial Papers/Equity Securities Local Currency Trading Gain/(Loss) Equity Securities Foreign Currency Trading Gain/(Loss) Equity Securities Foreign Regular Trading Gain/(Loss) Financial Futures/Options/Forwards/Swaps Trading Gain/(Loss) Financial Futures/Options/Forwards/Swaps Foreign Regular Trading Gain/(Loss) Financial Futures/Options/Forwards/Swaps FCDU/EFCDU 5-0-12-00 80 FOREIGN EXCHANGE PROFIT/(LOSS) Foreign Exchange Profit/(Loss) Foreign Exchange Profit.(Loss) FCDU/EFCDU 5-0-14-00 81 GOLD TRADING GAIN/(LOSS) 5-0-16-00 82 PROFIT /(LOSS) ON SALE OR REDEMPTION OF INVESTMENTS Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments Local Currency Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments Foreign Currency Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments Foreign Regular Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments FCDU/EFCDU Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Instruments Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Instruments Local Currency Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Investments Foreign Currency Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Investments Foreign Regular Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Instruments FCDU/EFCDU Profit/(Loss) on Sale or Redemption of Investments Equity Securities 5-0-18-00 83 INCOME/(LOSS) TRUST DEPARTMENT Copied verbatim from documents directly obtained from the Bangko Sentral ng Pilipinas . GL ACCT CODE ACCOUNT TITLE EXPENSE ACCOUNTS 6-0-02-00 85 INTEREST EXPENSE 6-0-02-02 a. Interest Expense on Deposits Interest Expense Demand Deposits Interest Expense Demand Deposits FCDU/EFCDU Interest Expense Savings Deposits Interest Expense Savings Deposits FCDU/EFCDU Interest Expense NOW Accounts Interest Expense Time Certificates of Deposits Interest Expense Time Certificates of Deposits FCDU/EFCDU 6-0-02-04 b. Interest Expense on Borrowed Funds Interest Expense Bills Payable (B/P) Interest Expense B/P BSP Interest Expense B/P Interbank Borrowings Interest Expense Interbank Loans Payable Interest Expense B/P Local Banks Interest Expense B/P Foreign Banks Interest Expense B/P Deposit Substitutes Interest Expense B/P Others Interest Expense B/P Others Domestic Interest Expense B/P Non-Banks Interest Expense B/P Private Firms and Individuals Interest Expenses B/P Others Interest Expense B/P Others Foreign Interest Expense B/P Others Foreign Regular Interest Expense B/P Others FCDU/EFCDU 6-0-02-06 c. Interest Expense on Bonds Payable 6-0-02-08 d. Interest Expense Others 6-0-04-00 86 FINANCE CHARGES 6-0-06-00 87 COMPENSATION/FRINGE BENEFITS a. Salaries and Wages 6-0-06-00 b. Fringe Benefits Directors 6-0-06-04 b. Fringe Benefits Officers 6-0-06-06 c. Fringe Benefits Employees 6-0-06-07 d. Directors' Fees 6-0-06-08 e. SSS, Medicare and Employees' Compensation 6-0-06-10 Premiums and Pag-IBIG Fund Contributions 6-0-06-12 f. Medical, Dental and Hospitalization 6-0-06-14 g. Contributions to Retirement/Provident Fund 6-0-08-00 88 MANAGEMENT AND OTHER PROFESSIONAL FEES Copied verbatim from documents directly obtained from the Bangko Sentral ng Pilipinas . b. Interbank Term Loans Receivable [1-2-02-04] Interbank Term Loans Receivable Local This represents loans/placements other than call/demand loans granted to local banks and non-bank financial intermediaries engaged in quasi-banking functions. Interbank Term Loans Receivable Foreign Regular 1/ This represents loans and discounts/placements granted to foreign banking/financial institutions and OBUs, allowed under existing rules and regulations, which shall be recorded at their respective foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. Sub-control accounts shall be maintained for: (a) OBUs; and (b) Other Banks Abroad. LLpr Interbank Term Loans Receivable FCDU/EFCDU This represents loans and discounts/placements granted to foreign banking/financial institutions and OBUs by FCDUs/EFCDUs which shall be recorded at their respective foreign currency amounts. Sub-control accounts shall be maintained for: (a) OBUs; and (b) Other Banks Abroad. Interbank Term Loans Receivable Local Bank FCDU/EFCDU This represents loans and discounts/placements granted to FCDU of other local banks which shall be recorded at their respective foreign currency amounts. 6. LOANS AND DISCOUNTS [1-2-04-00] a. Demand Loans [1-2-04-02] This represents loans granted with no fixed maturity dates but which become due and payable upon call or demand by the lending bank. b. Bills Discounted [1-2-04-04] This represents loans which are payable on a fixed date (usually within a period of one year), the interest of which is collected in advance or discounted from the face value of the covering promissory note. c. Time Loans [1-2-04-06] This represents loans which are payable on a fixed date or within a specified period of time (usually more than one year). d. Mortgage Contract Receivable [1-2-04-08] This represents the balance of the price of assets acquired which are sold under a plan of settlement, whereby the title to said asset is transferred to the buyer who executes a real estate mortgage contract in favor of the bank. e. Loans and Discounts Foreign [1-2-04-14] Loans and Discounts Foreign Regular 1 This represents loans and discounts denominated in foreign currency granted to parties/entities other than banking/financial institutions allowed under existing rules and regulations and which cannot be appropriately classified under any of the aforementioned foreign loan accounts. Sub-control accounts shall be maintained for: (a) residents, (b) non-residents. LibLex Loans and Discounts FCDU/EFCDU This represents foreign currency-denominated loans and discounts granted by FCDUs/EFCDUs under Circular No. 1389 which shall be recorded at their foreign currency amounts. Sub-control accounts shall be maintained for: (a) residents; and (b) non-residents. f. Peso Loans FCDU/EFCDU [1-2-04-16] This represents peso loans granted by FCDUs/EFCDUs arising from swap transactions with the Bangko Sentral. g. Past Due Loans and Discounts [1-2-04-18] Past Due Loans and Discounts Domestic This represents loans and discounts past due under existing rules and regulations. The loan shall remain in this account until fully paid; arrangements are formalized for loan renewal/extension/restructuring or collection/foreclosure case has been filed in the court/sheriff's office, as the case may be. LLjur Past Due Loans and Discounts Foreign Regular This represents loans and discounts, other than those granted by FCDUs/EFCDUs under Circular No. 1389, denominated in foreign currency which are considered past due under existing rules and regulations. The loan shall remain in this account until fully paid; arrangements are formalized for loan renewal/extension or collection/foreclosure case has been filed in court/sheriff's office, as the case may be. These loans shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Sub-control accounts shall be maintained for: (a) residents; and (b) non-residents. Past Due Loans and Discounts FCDU/EFCDU This represents loans and discounts granted by FCDUs/EFCDUs under Circular No. 1389 considered past due under existing rules and regulations. The loan shall remain in this account until fully paid; arrangements are formalized for loan renewal/extension/restructuring or collection/foreclosure case has been filed in the court/sheriff's office, as the case may be. These items shall be recorded at their foreign currency amounts. Sub-control accounts shall be maintained for: (a) residents; and (b) non-residents. 11. CUSTOMERS' LIABILITY FOR THIS BANK'S ACCEPTANCES OUTSTANDING [1-2-14-00] Customers' Liability for this Bank's Acceptances Outstanding Domestic This represents accommodations given to domestic traders in the form of acceptance credit arising from domestic trade which calls for time drafts payable within a specific number of days from the date of presentation by the beneficiaries. The account, therefore, reflects the traders' liabilities to the bank corresponding to the latter's liabilities to its local correspondent bank(s) concerned. Upon presentation and/or acceptance of the draft, this account shall be debited with a corresponding credit to the contra-liability account "Outstanding Acceptables Domestic". Customers' Liability for this Bank's Acceptances Outstanding Foreign 1/ This represents accommodations given to importers in the form of acceptance credit arising foreign trade which calls for time drafts payable within a specific number of days from the date of presentation by the beneficiaries. The account, therefore, reflects the importers' foreign currency liabilities to the bank corresponding to the liabilities to its foreign correspondent bank(s) concerned. Upon presentation and/or acceptance of the draft, this account shall be debited with a corresponding credit to the contra-liability account "Outstanding Acceptances Foreign". The accepted drafts shall be recorded at their respective foreign currency amounts and at their currency equivalent at the applicable rate of exchange on transaction dates. 12. RESTRUCTURED LOANS [1-2-16-00] a. Restructured Loans [1-2-16-02] This represents loans, the principal terms and conditions of which have been modified in accordance with a restructuring agreement setting forth a new plan of payment or a schedule of payment on a periodic basis. Restructured loans Fully Secured (Circular No. 169 dated July 13, 1998) This represents restructured loans including capitalized interest thereon, which are in current status and are fully secured by real estate with loan value of up to 60% of the appraised value of the real estate security and insured improvements and by other first class collaterals as may be deemed appropriate by the Monetary Board. Restructured loan lodged to this account shall be treated as performing loans where interest income can be accrued. Sub-control accounts shall be maintained for the following: (a) Restructured Loans-Domestic; (b) Restructured Loans-Foreign Regular; and (c) Restructured Loans-FCDU/EFCDU. Restructured Loans Unsecured or Partially Secured This represents restructured loans including capitalized interest thereon, which are in current status and are either unsecured or are not fully secured by real estate with loan value of up to 60% of the appraised value of the real estate security and insured improvements, and by other first class collaterals as may be deemed appropriate by the Monetary Board. Restructured loans lodged to this account shall be treated as non-performing loans where no interest income can be accrued. Sub-control accounts shall be maintained for the following: (a) Restructured Loans-Domestic; (b) Restructured Loans-Foreign Regular, and (c) Restructured Loans-FCDU/EFCDU. LLcd b. Past Due Restructured Loans [1-2-16-04] This represents restructured loans which are considered past due under existing rules and regulations. The loan shall remain in this account until fully paid or collection/foreclosure case has been filed in court/sheriff's office, as the case may be. c. Items in Litigation Restructured Loans [1-2-16-06] This represents all restructured loans for which collection/foreclosure cases have been filed in court or sheriff's office, as the case may be. The loan shall remain in this account during the pendency of the proceedings or until full payment or such other disposition is made as would cause such proceedings to cease. All expenses incurred incidental to the litigation shall be charged to operations and debited to "Litigation/Assets Acquired Expenses" account. Corresponding memorandum entries for the expenses shall be made on the individual subsidiary ledgers of the account concerned. d. Allowance for Probable Losses Restructured Loans [2-7-16-00] This represents the amount set up against current operations to provide for losses which may arise from non-collection of the restructured loans. Under existing regulation, this account is also known as "valuation reserve". 13. UNDERWRITING ACCOUNTS (UA) DEBT SECURITIES for EKBs [1-2-18-00] This represents underwritten debt securities purchased and held principally with the intention of selling them within a defined short-term period. The daily valuations for these securities are at fair market values with unrealized gains or losses excluded from reported earnings and reported as a separate component of stockholders' equity until realized. Banks may opt to book the mark-to-market valuation every end of the month provided, that an adequate mechanism is in place to determine the daily fair market value of securities. a. Underwritten Debt Securities Purchased [1-2-18-02] This represents the cost of debt securities purchased which have remained unsold/locked-in from underwriting ventures on a firm basis. b. Accumulated Market Gains/(Losses) Underwritten Debt Securities Purchased [1-2-18-03] This represents the amount of unrealized gains or losses arising from the fair market valuation of underwritten debt securities purchased. The account is debited for gains and credited for losses. The contra account is "Net Unrealized Gains/(Losses) on Securities Available for Sale", which is a separate component of stockholders' equity. Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed. Cdphil c. Receivables Underwritten Debt Securities Sold [1-2-18-04] This represents claims from the sale of underwritten debt securities. 14. TRADING ACCOUNT SECURITIES (TAS) LOANS [1-2-20-00] This represents debt securities purchased and held principally with the intention of selling them in the near term. They must have readily determinable fair market values and by their very nature require daily mark-to-market valuation where unrealized and realized gains and losses are recognized and booked against "Trading Gain/(Loss)" account. Banks may opt to book the mark-to-market valuation every end of the month provided, that an adequate mechanism is in place to determine the daily fair market values of securities. a. Government Securities Purchased under Resale Agreements [1-2-20-02] This represents the cost of government securities purchased under agreements whereby the purchasing bank shall sell said securities to the seller(s) on a stipulated future date. b. Government Securities Purchased under Certificates of Assignment/Participation with Recourse [1-2-20-04] This represents the cost of government securities purchased under certificates of assignment/participation with recourse. c. Government Securities Purchased under Reverse Repurchase Agreements with the Bangko Sentral ng Pilipinas (BSP) [1-2-20-06] This represents the cost of government securities purchased from the BSP under agreements whereby the BSP shall buy back the government securities on a stipulated future date. d. Private Debt Securities/Commercial Papers (CPs) Purchased [1-2-20-08] This represents the cost of commercial papers and other debt securities issued by private entities which are purchased for the bank's trading activities. e. Private Debt Securities/Commercial Papers Purchased Under Resale Agreements [1-2-20-10] This represents the cost of commercial papers and other debt securities issued by private entities which are purchased under agreements whereby the purchasing bank shall sell the said securities to the seller(s) on a stipulated future date. LLpr f. Private Debt Securities/Commercial Papers Sold Under Repurchase Agreements [1-2-20-12] This represents the cost papers and other debt securities issued by private entities which are sold under agreements whereby the selling bank shall buy back (repurchase) the said securities from the purchaser on a stipulated future date. g. Private Debt Securities/Commercial Papers Purchased Under Certificates of Assignments/Participation with Recourse [1-2-20-14] This represents the cost of commercial papers and other debt securities issued by private entities which are purchased under certificates of assignment/participation with recourse. 14-a. GENERAL LOAN LOSS PROVISION [2-7-80-00] This represents the amount of general provision for loan losses not linked to individually identified uncollectible accounts required to be set up under existing regulations equivalent to 2% of gross loan portfolio, less interbank loans, loans guaranteed by the Small Business Guarantee and Finance Corporation, Philippine Export Guarantee, Guarantee Fund for Small and Medium Enterprises and other government guarantee corporations, provided these loans are not past due, and loans which are considered non risk under existing laws/rules/regulations. From the loan portfolio, net of the foregoing exclusions, loans subject to specific loan loss provisioning (at least equal to the BSP recommended classification as of latest examination) shall be deducted to arrive at the net loan portfolio, which shall be the basis of the computation of the prescribed percentage for General Loan Loss Provisioning. Sub-control accounts shall be maintained for (a) domestic; (b) foreign regular; and, (c) FCDU/EFCDU. LibLex 14-b. UNDERWRITING ACCOUNTS (UA) EQUITY SECURITIES for EKBs [1-3-10-00] This represents underwritten equity securities purchased and held principally with the intention of selling them within a defined short-term period. The daily valuations for these securities are at fair market values with unrealized gains or losses excluded from reported earnings and reported as a separate component of stockholders' equity until realized. Banks may opt to book the mark-to-market valuation every end of the month provided, that an adequate mechanism is in place to determine the daily fair market values of securities. a. Underwritten Equity Securities Purchased [1-3-10-02] This represents the cost of equity securities purchased which have remained unsold/locked-in from underwriting ventures on a firm basis. Securities outstanding for more than two (2) years from the end of the offering period should be reclassified either as "Trading Account Securities Equity" or "Equity Investments", depending on the intention of the bank. b. Accumulated Market Gains/(Losses) Underwritten Equity Securities Purchased [1-3-10-04] This represents the amount of unrealized gains or losses arising from the fair market valuation of underwritten equity securities purchased. The account is debited for gains and credited for losses. The contra account is "Net Unrealized Gains/(Losses) on Securities Available for Sale", which is a separate component of stockholders' equity. Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed. cdll c. Receivables Underwritten Equity Securities Sold [1-3-10-06] This represents claims from the sale of underwritten equity securities. 15. TRADING ACCOUNT SECURITIES (TAS) INVESTMENTS [ 1-3-20-00] This represents government securities purchased and held principally with the intention of selling them in the near term. They must have readily determinable fair market values and by their very nature require mark-to-market valuation where unrealized and realized gains and losses are recognized and booked against "Trading Gain/(Loss)" account. Banks may opt to book the mark-to-market valuation every end of the month provided, that an adequate mechanism is in place to determine the daily fair market values of securities. a. Government Securities Purchased [1-3-20-02] Government Securities Purchased Local Currency This represents the cost of government securities purchased for the bank's trading activities. Government Securities Purchased Foreign Regular This represents the cost of foreign currency denominated government securities purchased for the bank's trading activities which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. aisadc Government Securities Purchased FCDU/EFCDU This represents the cost of foreign currency denominated government securities purchased by the FCDU/EFCDU for its trading activities which shall be recorded at their foreign currency amounts. b. Government Securities Sold Under Repurchase Agreements [1-3-20-04] Government Securities Sold Under Repurchase Agreements Local Currency This represents the cost of government securities sold under agreements whereby the selling bank shall buy back (repurchase) the said securities from the purchaser on a stipulated future date. Government Securities Sold Under Repurchase Agreements Foreign Regular This represents the cost of foreign currency denominated government securities sold under agreements whereby the selling bank shall buy back (repurchase) the said securities from the purchaser on a stipulated future date. This shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. cdlex Government Securities Sold Under Repurchase Agreements FCDU/EFCDU This represents the cost of foreign currency denominated government securities sold by the FCDU/EFCDU under agreements whereby the selling bank shall buy back (repurchase) the said securities from the purchaser on a stipulated future date. This shall be recorded at their foreign currency amounts. 15-a. TRADING ACCOUNT SECURITIES (TAS) EQUITY for EKBs [1-3-30-00] This represents equity securities purchased and held principally with the intention of selling them in the near term. They must have readily determinable fair market values and by their very nature require daily mark-to-market valuation where unrealized and realized gains and losses are recognized and booked against "Trading Gain/(Loss)" account. Banks may opt to book the mark-to-market valuation every end of the month provided, that an adequate mechanism is in place to determine the daily fair market values of securities. Trading Account Securities Equity Local Currency This represents the cost of shares of stocks and other equity securities issued by private entities which are purchased for the bank's trading activities. Trading Accounts Securities Equity Foreign Regular This represents the cost of shares of foreign currency-denominated stocks and other equity securities issued by private entities which are purchased for the bank's trading activities. This shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. 15-b. AVAILABLE FOR SALE SECURITIES (ASS) [1-3-40-00] This represents debt securities purchased and held indefinitely, i.e., neither held to maturity nor for trading purposes, where the bank anticipates that the securities will be available to be sold in response to liquidity needs and/or to reduction in legal reserves, liquidity reserves, liquidity floor, security deposits and/or allowable alternative investments. The daily valuations for these securities are at fair market values to account for both upward and downward market movements. However, unrealized gains or losses shall be excluded from reported earnings and reported as a separate component of stockholders' equity until realized. Banks may opt to book the mark-to-market valuation every end of the month provided, that an adequate mechanism is in place to determine the daily fair market values of securities. a. Available for Sale Securities Government [1-3-40-02] This represents the cost of debt securities purchased and held indefinitely, generally consisting of bonds, treasury bills/notes and certificates of indebtedness issued by the Philippine Government, its political subdivisions and instrumentalities and/or corporations owned and/or controlled by the government. prLL Available for Sale Securities Reserve Purposes This represents the cost of government securities used for reserve purposes, as required under existing rules and regulations. Available for Sale Securities Guarantee for Trust Functions/Duties This represents the cost of government securities deposited with BSP as guarantee for trust functions/duties as required under existing rules and regulations. Available for Sale Securities Others This represents the cost of government securities that cannot be appropriately classified under any of the above accounts. Accumulated Market Gains/(Losses) ASS Government Issue [1-3-40-04] This represents the amount of unrealized gains or losses arising from the fair market valuation of available for sale government securities. The account is debited for gains and credited for losses. The contra account is "Net Unrealized Gains/(Losses) on Securities Available for Sale", which is a separate component of stockholders' equity. Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed. LLjur b. Available for Sale Securities Private [1-3-40-06] This represents the cost of securities issued by private entities. Accumulated Market Gains/(Losses) ASS Private Issue [1-3-40-08] This represents the amount of unrealized gains or losses arising from the fair market valuation of available for sale private securities. The account is debited for gains and credited for losses. The contra account is "Net Unrealized Gains/(Losses) on Securities Available for Sale", which is a separate component of stockholders' equity. Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed. c. Available for Sale Securities Foreign [1-3-40-10] Available for Sale Securities Foreign Regular This represents the cost of foreign currency-denominated bonds and other debt instruments, such as US Treasury Notes and Bonds, which shall be recorded at their respective foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Sub-control accounts shall be maintained for: (a) ASS issued by residents; and (b) ASS issued by non-residents. Available for Sale Securities FCDU/EFCDU This represents the cost of investments in foreign currency denominated bonds and other debt instruments which shall be recorded at their respective foreign currency amounts. Sub-control accounts shall be maintained for (a) ASS issued by residents; and (b) ASS issued by non-residents. Accumulated Market Gains/(Losses) ASSN Foreign [1-3-40-12] Accumulated Market Gains/(Losses) ASSN Foreign Regular This represents the amount of unrealized gains or losses arising from the fair market valuation of available for sale foreign securities. The accounts is debited for gains and credited for losses, which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. The contra account is "Net Unrealized Gains/(Losses) on Securities Available for Sale", which is a separate component of stockholders' equity. Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed. Accumulated Market Gains/(Losses) ASS FCDU/EFCDU This represents the amount of unrealized gains or losses arising from the fair market valuation of available for sale foreign securities of the FCDU/EFCDU. The account is debited for gains and credited for losses, which shall be recorded at their foreign currency amounts. The contra account is "Net Unrealized Gains/Losses) on Securities Available for Sale", which is a separate component of stockholders' equity. Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed. 16. INVESTMENTS IN BONDS AND OTHER DEBT INSTRUMENTS (IBODI) [1-3-50-00] This represents debt securities where the financial institution has the intention and ability to hold these securities to maturity. Such investments shall be measured at amortized cost where any realized gains of losses shall be included in reported current income. However, if a decline in fair market value below the amortized cost is other than temporary, i.e., full collection of principal and interest is not expected on a debt security, the amortized cost basis of the particular debt security shall be adequately provided with allowance for probable losses. The amount of investment loss provision shall be accounted for as a realized loss and charged to reported current income. The ability to hold to maturity is evidenced by the funding structure of such securities wherein IBODI shall not exceed 50% of adjusted net worth plus 40% of total deposit liabilities. For foreign bank branches, the adjusted net worth shall include "net due to head office/branches/agencies" which shall not exceed the equivalent of four (4) times [three (3) times for foreign bank branches with expanded commercial banking authority] the amount of permanently assigned capital. cdlex Sales of debt securities that meet either of the following two conditions may be considered as maturities for purposes of the classification of securities under IBODI: 1. The sale of debt security occurs near enough to its maturity date (or call date if exercise of the call is probable) that interest rate risk is substantially eliminated as a pricing factor. That is, the date of sale is so near the maturity or call date (for example, within three months) that changes in market interest rates would not have a significant effect on the security's fair market value. 2. The sale of a debt security occurs after that bank has already collected at least eighty five per cent (85%) of the principal outstanding at acquisition due either to prepayments on the debt security or to scheduled payments on a debt security payable in installments (both principal and interest) over its term. a. Investments in Bonds and Other Debt Instruments Government [1-3-50-02] This represents the cost of investments in securities, generally consisting of bonds, treasury bills/notes and certificates of indebtedness issued by the Philippine Government, its political subdivisions and instrumentalities and/or corporations owned and/or controlled by the government. Investments in Bonds and Other Debt Instruments Reserve Purposes This represents the cost of investments in government securities used for reserve purposes as required under existing rules and regulations. Investments in Bonds and Other Debt Instruments Guarantee for Trust Functions/Duties This represents the cost of investments in government securities deposited with BSP as guarantee for trust functions/duties as required under existing rules and regulations. Investments in Bonds and Other Debt Instruments Others This represents the cost of investments in government securities that cannot be appropriately classified under any of the above accounts. cdt Accumulated Bond Discount IBODI Government Issue [1-8-50-02] Accumulated Premium Amortization IBODI Government Issue [2-8-50-02] This represents the earned portion of the discount and/or the amortized portion of the premium on investment in government securities which shall be debited/credited, respectively, monthly to this account with the corresponding debit/credit to "Interest Income IBODI Local Currency" account. Upon the disposition of the securities, the account corresponding to the redeemed, transferred or sold securities shall be reversed. b. Investments in Bonds and Other Debt Instruments Private [1-3-50-04] This represents the cost of investments in bonds and other debt instruments issued by private entities. Accumulated Bond Discount IBODI Private Issue [1-8-50-04] Accumulated Premium Amortization IBODI Private Issue [2-8-50-04] This represents the earned portion of the discount and/or the amortized portion of the premium on investment in private securities which shall be debited/credited, respectively, monthly to this account with the corresponding debit/credit to "Interest Income IBODI Local Currency" account. Upon disposition of the securities, the account corresponding to the redeemed, transferred or sold securities shall be reversed. c. Investments in Bonds and Other Debt Instruments Foreign [1-3-50-06] Investments in Bonds and Other Debt Instruments Foreign Regular 1/ This represents the cost of investments in foreign currency-denominated bonds and other debt instruments, such as US Treasury Notes and Bonds, which shall be recorded at their foreign currency amounts and their local currency equivalent at the applicable rate of exchange on transaction dates. Sub-control accounts shall be maintained for: (a) IBODI issued by residents; and (b) IBODI issued by non-residents. Investments in Bonds and Other Debt Instruments FCDU/EFCDU This represents the cost of investments in foreign currency-denominated bonds and other debt instruments of the FCDU/EFCDU which shall be recorded at their foreign currency amounts. Sub-control accounts shall be maintained for: (a) IBODI issued by residents; and (b) IBODI issued by non-residents. Accumulated Bond Discount IBODI Foreign [1-8-50-06] Accumulated Premium Amortization IBODI Foreign [2-8-50-06] Accumulated Bond Discount IBODI Foreign Regular 1/ Accumulated Premium Amortization IBODI Foreign Regular 1/ This represents the earned portion of the discount and/or the amortized portion of the premium on investment in foreign currency-denominated bonds and other debt instruments which shall be debited/credited, respectively, monthly to this account with the corresponding debit/credit to "Interest Income IBODI Foreign Regular" account. This shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange transaction dates. Upon disposition of the securities, the account corresponding to the redeemed, transferred or sold securities shall be reversed. LibLex Accumulated Bond Discount IBODI FCDU/EFCDU Accumulated Premium Amortization IBODI FCDU/EFCDU This represents the earned portion of the discount and/or the amortized portion of the premium on investment in foreign currency-denominated bonds and other debt instruments of the FCDU/EFCDU which shall be debited/credited, respectively, monthly to this account with the corresponding debit/credit to "Interest Income IBODI FCDU/EFCDU" account. This shall be recorded at their foreign currency amounts. Upon disposition of the securities, the account corresponding to the redeemed, transferred or sold securities shall be reversed. d. Allowance for Probable Losses IBODI [2-8-50-00] This represents the amount set up against current operations to provide for losses on IBODI. When the decline in fair market value below the amortized cost is other than temporary, i.e., full collection of principal and interest is not expected on a debt security, the amortized cost basis of the particular debt security shall be adequately provided with allowance for probable losses. The amount of investment loss provision shall be accounted for as a realized loss and charged to reported current income. LLcd Allowance for Probable Losses IBODI Domestic This represents the amount set up against current operations to provide for losses on IBODI Domestic. Under existing regulations, this account is also known as "valuation reserve". Allowance for Probable Losses IBODI Foreign Regular This represents the amount set up against current operations to provide for losses on IBODI Foreign Regular. Under existing regulations, this account is also known as "valuation reserve". This shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Allowance for Probable Losses IBODI FCDU/EFCDU This represents the amount set up against current operations to provide for losses on IBODI FCDU/EFCDU. Under existing regulations, this account is also known as "valuation reserve". This shall be recorded at their foreign currency amounts. 17. EQUITY INVESTMENTS [1-3-60-00] This represents the cost of investments in shares of stock including any unpaid subscriptions, of companies/installations, as allowed under existing laws, rules and regulations. Equity investments shall be booked at cost of book value, whichever is lower, on the date of acquisition. If cost is greater than book value, the excess shall be charged in full to operations of booked as deferred charges and amortized as expense over a period not exceeding five (5) years. Subsequent to acquisition, equity investments should still be carried at recorded value on date of acquisition; except for investments representing more than 50% of the voting stock of the investee company in which case the equity method of accounting shall be Copied verbatim from documents directly obtained from the Bangko Sentral ng Pilipinas . Equity Investments in Non-Allied Undertakings Abroad (for EKBs) This represents the cost of equity investments in non-allied undertakings abroad which shall be recorded at their respective foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. cdlex c. Allowance for Probable Losses Equity Investments [2-8-06-00] This represents the amount set up against current operations to provide for losses such as decline in market or book value which may arise on equity investments. Under existing regulations, this account is also known as "valuation reserve". 18. DUE FROM HEAD OFFICE/BRANCHES/AGENCIES (DFHO/B/A) [1-4-02-00] The accounts "Due From Branches/Agencies" and "Due to Branches/Agencies" are general ledger Head Office control accounts. The counterpart of these accounts in the books of the Branches consist of the general ledger control accounts "Due from Head Office" and "Due to Head Office". If the balance of the Head Office account with its Branch is a debit, the account is carried as a "Due From", an asset account in the books of the Head Office. Conversely, if the balance of the Head Office account with its Branch is a credit, the account is carried as a "Due To", a liability account in the books of the Head Office. The same rule applies to balance of the Branches accounts ("Due From" or "Due To" Head Office) with the Head Office. These accounts are essentially clearing accounts through which Head Office/Branches/Agencies and interbranches/agencies transactions are cleared. Inter-Head Office-Branch transactions originating from Head Office are debited or credited to the account of the Branch concerned. The same applies to direct transactions of the Branch with the Head Office. Inter-Branch/Agency transactions, on the other hand, shall be cleared thru the Head Office. The latter responds to the advice of the Branch/Agency where the transactions originated by debiting or crediting, as the case may be, the account of the office to which the transaction pertains. Likewise, Branch transactions with the bank's local and foreign correspondents shall be coursed thru the Head Office account. Head Office and Branches' accounts aforementioned are reciprocal accounts which are eliminated upon consolidation. The transactions which pass through these accounts are: LLpr Investments of Head Office (HO) in its Branches/Agencies Advances of Head Office (HO) to its Branches/Agencies Check and cash remittances Transfers of loan and other asset accounts Responses to other debit/credit advices of Branches/Agencies Other receipts/payments made for account of Branches/Agencies Advances made by Branches/Agencies for the account of HO or vice versa Remittances of Branches/Agencies to Head Office (HO) Other interhead-office branch(es) transactions not specified above In the preparation of consolidated statements, the reciprocal accounts shall be eliminated and the resulting debit difference shall be reported under Inter-Office Float Items (Debit Balance) or, if a credit balance, shall be reported under Inter-Office Float Items (Credit Balance). Individual subsidiary ledger accounts for each Branch/Agency shall be maintained by the Head Office. Sub-control ledger accounts shall be maintained for items which are unresponded and outstanding for sixty calendar days or more. Sub-control accounts shall also be maintained for the following: a. Due From Head Office/Branches/Agencies in the Philippines [1-4-02-02] This account controls the clearing of items/transactions between the bank's Head Office and its local branches/agencies. b. Due From Head Office/Branches/Agencies in the Philippines-FCDU/EFCDU [1-4-02-04] This account controls the clearing of items/transactions under the FCDU/EFCDU system between the bank's Head Office and its local branches/agencies which shall be recorded at their respective foreign currency amounts. LibLex 99BC 201 - D ANNEX KB 10 4. UNEARNED INCOME This represents the unearned portion of interest or discount on loans, bonds and other debt instruments collected in advance which shall be amortized monthly to the income accountability of the trustee/fiduciary for the earned portion. In the case of common trust funds, the amortization to the income accountability shall be in accordance with the established plan of the fund. This represents also unrealized profits from the sale of assets under Sales Contracts Receivable. Upon receipt of payment, the proportionate amount of profits shall be credited to the income accountability of the trustee, fiduciary or investment manager to the client. Financial Statement Presentation The account shall be shown as a separate item among the accountabilities of the trustee or fiduciary. cdll 5. OTHER ACCOUNTABILITIES This represents the accountability of the trustee, fiduciary or investment manager for items or transactions, which cannot be appropriately classified under any of the foregoing accountability accounts. Appropriate sub-control accounts shall be maintained. Financial Statement Presentation This account shall be shown as a separate item. 6. DEFERRED ITEMS CTF REVALUATION CONTRA ACCOUNT This is the reciprocal account of the CTF Revaluation Account which represents the difference between the original cost and the value of investments made by common trust funds in shares of stocks and real estate based on the valuation methods provided in the approved plan for such funds. It is reversed upon the actual sale or disposition of any of such investments. The following sub-control accounts shall be maintained for this account: a. Investments in Shares of Stock for CTF investments in equity shares. b. Investments in Real Estate for CTF investments in real properties. Valuation Amounts booked under this account shall be based on the valuation method stated in the approved plan for the common trust fund. Financial Statement Presentation This item is presented in financial statements and reports to common trust fund participants after the Common Trust Fund Principal and Income accounts. LLphil Copied verbatim from documents directly obtained from the Bangko Sentral ng Pilipinas . Accumulated Depreciation Furniture, Fixtures & Equipment Abroad This represents the accumulated depreciation of furniture, fixtures and equipment of bank's branches/agencies abroad which shall be set up monthly against current operations. This account which is also known as "Reserve for Depreciation" shall be recorded at their foreign currency amounts. 20. REAL AND OTHER PROPERTIES OWNED OR ACQUIRED (ROPOA) [1-4-06-00] a. Real and Other Properties Owned or Acquired [1-4-06-02] Real and Other Properties Owned or Acquired This represents real and other properties, other than those used for banking purposes or held in the investment portfolio, acquired by the bank in settlement of loans and/or for other reasons. The property acquired in settlement of loans shall be recorded at the principal balance of the loan plus (a) booked accrued interest receivable, after considering allowance for uncollected interest on loans less unamortized income, and (b) non-refundable capital gains tax and documentary stamp tax incurred in connection with the foreclosure; or bid price, whichever is lower, provided that, in either case, the total book value does not exceed the appraised value of the foreclosed asset, as determined by an independent external appraiser acceptable to Bangko Sentral ng Pilipinas. However, the property acquired for other reasons shall be recorded at cost or appraised value when cost is not involved/determinable in the acquisition of the property. Any excess of loan balance over the bid price shall be debited to "Miscellaneous Income/Loss" account. Claims arising from deficiency judgments rendered in connection with the foreclosure of mortgaged properties shall be lodged under the real account "Deficiency Judgement Receivable". While probable claims against the borrower-debtor arising from the foreclosure of mortgaged properties shall be lodged under the contingent account "Deficiency Claims Receivable". All expenses incurred in the preservation/maintenance of these properties shall be debited to "Litigation/Assets Acquired Expenses" account. All income realized therefrom shall be credited to "Income from Assets Acquired" account. Corresponding memorandum entries shall be made on the individual subsidiary ledgers of the accounts concerned. Real and Other Properties Owned or Acquired FCDU/EFCDU This represents real and other properties of FCDUs/EFCDUs, other than those used for banking purposes or held in the investment portfolio, acquired by the bank in settlement of loans and/or for other reasons. The property acquired in settlement of loans shall be recorded at the principal balance of the loan plus (a) booked accrued interest receivable, after considering allowance for uncollected interest on loans less unamortized income, and (b) non-refundable capital gains tax and documentary stamp tax incurred in connection with the foreclosure; or bid price, whichever is lower, provided that, in either case, the total book value does not exceed the appraised value of the foreclosed asset, as determined by an independent external appraiser acceptable to Bangko Sentral ng Pilipinas. However, the property acquired for other reasons shall be recorded at their foreign currency amounts at cost or appraised value when cost is not involved/determinable in the acquisition of the property. Any excess of loan balance over the bid price shall be debited to "Miscellaneous Income/Loss" account. Claims arising from deficiency judgments rendered in connection with the foreclosure of mortgaged properties shall be lodged under the real account "Deficiency Judgment Receivable". While probable claims against the borrower-debtor arising from the foreclosure of mortgaged properties shall be lodged under contingent account "Deficiency Claims Receivable". All expenses incurred in the preservation/maintenance of these properties shall be debited to "Litigation/Assets Acquired Expenses" account. All income realized therefrom shall be credited to "Income from Assets Acquired" account. Corresponding memorandum entries shall be made on the individual subsidiary ledgers of the accounts concerned. Real and Other Properties Owned or Acquired Abroad This represents real and other properties, other than those used for banking purposes or held in the investment portfolio, acquired by the branches/agencies of the bank abroad in settlement of loans and/or for other reasons. The property acquired in settlement of loans shall be recorded at cost or appraised value when cost is not involved/determinable in the acquisition of the property. Any excess of loan balance over the bid price shall be debited to "Miscellaneous Income/Loss" account. All expenses incurred in the preservation/maintenance of these properties shall be debited to "Litigation/Assets Acquired Expenses" account. All income realized therefrom shall be credited to "Income from Assets Acquired" account. Corresponding memorandum entries shall be made on the individual subsidiary ledgers of the accounts concerned. These items shall be recorded at their foreign currency amounts. b. Allowance for Probable Losses ROPOA [2-9-06-00] This represents the amount set up against current operations to provide for losses which may arise from the excess of book value over the appraised value of the property and/or from, its sale/disposition, and/or for valuation allowance as may be required under existing rules and regulations. This account is also known as "valuation reserve" under existing rules and regulations. Sub-control accounts shall be maintained for: (a) domestic (b) abroad and (c) FCDU/EFCDU. c. Sales Contract Receivable [1-4-06-04] This represents the balance of the selling price of assets owned and/or acquired under a plan of settlement, whereby the title to the said assets is transferred only to the buyer upon full payment of the agreed selling price. LLpr 21. BOND SINKING FUND (for EKBs) [1-4-08-00] This represents the accumulated amount set aside from the redemption of issued and outstanding bonds. Sub-control accounts shall be maintained for: a. Bond Sinking Fund Cash b. Bond Sinking Fund Deposits in Banks c. Bond Sinking Fund Securities 22. OTHER ASSETS a. Gold [1-4-10-00] 1/ This represents the cost of gold bullion and bars which come into the possession of the bank as an authorized gold dealer. Gold bullion and bars in the possession of branches/agencies abroad of banks shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. LibLex b. Foreign Currency Notes and Coins on Hand [1-4-12-00] Foreign Currency Notes and Coins on Hand-Regular 1/ This represents the total amount of foreign currency notes and coins on hand which shall be recorded at their respective foreign currency amounts and at their local MISSING PAGES 22-25 actually sustained and/or written-off and considered deductible for income tax purposes. t. Deposits with Closed Banks/Banks in Liquidation [1-4-44-00] This represents demand, savings and/or time deposits maintained with a bank and/or private securities/commercial papers purchased from financial intermediaries (banks and non-banks) which have been closed or placed under liquidation. u. Allowance for Probable Losses Deposits with Closed Banks/Banks in Liquidation [2-9-44-00] This represents the amount set up against current operations to provide for losses which may arise from non-recovery of deposits with banks and/or private securities purchased form financial intermediaries (banks and non-banks) which have been closed or placed under liquidation. Under existing rules and regulations, this account is also known as "valuation reserve". v. Sundry Debits [1-4-46-00] Sundry Debits This represents items/transactions which at the time of recording cannot be classified immediately under any debit account. Entries to this account shall be cleared within one (1) month from the date of entry. Sundry Debits FCDU/EFCDU This represents items/transactions which at the time of recording cannot be classified immediately under any debit FCDU/EFCDU account. These items shall be recorded at their respective foreign currency amounts. Entries to this account shall be cleared within one (1) month from date of entry. w. Allowance for Probable Losses Other [2-9-46-00] This represents the amount set up against operations to provide for losses which may arise from non-recovery of other risk assets for which no specific "Allowance for Probable Losses" account has been provided herein. This account is also known as "valuation reserve" under existing rules and regulations. LLjur x. Other Investments [1-4-48-00] This represents the cost of investments made for public relations purposes and/or to qualify as member/subscriber of clubs/other non-profit organization, and for purposes of availing the services of public utility firms or other entities, excluding deposits paid for rentals of premises and equipment, or for service and other contracts. y. Inter-office Float Items (Debit Balances) [1-4-50-00] This represents the debit balance difference between the Due from Head Office/Branches/Agencies and Due to Head Office/Branches/Agencies accounts resulting from the elimination of reciprocal accounts in the consolidation process. This account shall be used only for consolidated statements. Sub-control accounts shall be maintained for the following (a) Domestic; (b) Foreign Regular; and (c) FCDU/EFCDU. z. Miscellaneous Assets [1-4-52-00] Miscellaneous Assets This represents items/transactions which cannot be appropriately classified under any of the foregoing asset accounts. Miscellaneous Assets FCDU/EFCDU This represents items/transactions which cannot be appropriately classified under any of the foregoing FCDU/EFCDU asset accounts which shall be recorded at their respective foreign currency amounts. MISSING PAGES 27-32 c. Due to Local Banks Clearing Accounts [2-3-04-06] Due to Local Banks Local Clearing This represents credit balances of local banks (i.e. Phil. National Bank) or any of its branches for clearing checks drawn on banks located in places not serviced by BSP clearing offices. Due to Local Banks FX Clearing This represents credit balances of participating banks maintained with the franchise holder of Philippine Domestic Dollar Transfer Service System (PDDTS) for clearing of foreign currency denominated checks which shall be recorded at their foreign currency amounts. aisadc 30. DUE TO FOREIGN BANKS (LOCAL CURRENCY) [2-3-06-00] This represents credit balances of foreign corresponding banks maintained as working funds in local currency with the local bank funded by inward remittances subject to drawing through payment order of the former. 31. DUE TO HEAD OFFICE/BRANCHES/AGENCIES [2-3-08-00] a. Due To Head Office/Branches/Agencies in the Philippines [2-3-08-02] This account controls the clearing of items/transactions between the bank's Head Office and its local branches/agencies. This is the reciprocal account of DFHO/B/A in the Philippines. b. Due To Head Office/Branch/Agencies in the Philippines-FCDU/EFCDU [2-3-08-04] This account controls the clearing of items/transactions under FCDU/EFCDU between the bank's Head Office and its local branches/agencies. This is the reciprocal account of DFHO/B/A in the Philippines FCDU/EFCDU. prLL c. Due To Head Office/Branches/Agencies Abroad (Local Currency) [2-3-08-05] This represents deposits and working balances maintained by the Head Office/Branches/Agencies abroad of the Philippine branch of foreign banks with the local branch which shall be funded by inward remittances in foreign currencies. d. Due To Head Office/Branches/Agencies Abroad Regular [2-3-08-06] 1/ This represents deposits, placements and working balances maintained by the Head Office/Branches/Agencies abroad of the Philippine branch of foreign banks (i.e. BA, HSBC, CitiBank and SCB) and branches/agencies abroad of Philippine banks (i.e. ABC, MBTC, PNB, etc.) which shall be recorded at their respective foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. This is the reciprocal account of DFHO/B/A Abroad Regular. e. Due To Head Office/Branches/Agencies Abroad FCDU/EFCDU [2-3-08-08] This represents deposits, placements and working balances under FCDU/EFCDU maintained by the Head Office/Branches/Agencies abroad of the Philippine branch of foreign banks (i.e. BA, HSBC, CitiBank, SCB) and branches/agencies abroad of Philippine Banks (i.e. ABC, MBTC, PNB, etc.) which shall be recorded at their respective foreign currency amounts. This is the reciprocal amount of DFHO/B/A Abroad FCDU/EFCDU. cdlex f. Due To Head Office/Branches/Agencies Abroad Assigned Capital [2-3-08-10] This represents portion of Due to Head Office account of Philippine branches of foreign banks assigned permanently as capital pursuant to counterpart concessional loans under existing regulations, which shall be recorded at their respective foreign currency amounts and at their local currency equivalent on transaction dates. This account also includes unremitted profits not yet approved by Bangko Sentral for outward remittance. 32. TREASURER'S/CASHIER'S/MANAGER'S AND GIFT CHECKS [2-3-10-00] This represents the aggregate amount of checks drawn by the bank upon itself payable to the payees named in the check. 33. PAYMENT ORDERS PAYABLE [2-3-12-00] Payment Orders Payable Domestic This represents inward and outward remittances of local funds by telegraphic transfers, demand drafts or mail transfer orders received by the bank pending payment/disposition to designated beneficiaries or application/disposition to appropriate accounts. LibLex Payment Orders Payable Foreign Regular 1/ This represents inward and outward remittances of foreign funds by telegraphic transfers, demand drafts or mail transfer orders received by the bank pending payment/disposition to designated beneficiaries or application/disposition to appropriate accounts which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. Payment Orders Payable FCDU/EFCDU This represents inward and outward remittances of foreign funds by telegraphic transfers, demand drafts or mail transfer orders received by the bank pending payment/disposition to designated beneficiaries or application/disposition to appropriate accounts which shall be recorded at its foreign currency amounts. 34. MARGIN DEPOSITS [2-3-14-00] Margin Deposits Domestic Letters of Credit This represents non-interest bearing deposits required on commercial letters of credit issued in favor of local beneficiaries arising from domestic movement of goods or services. Margin Deposits Import Letters of Credit (Local Currency) This represents non-interest bearing peso deposits required of importers under existing rules and regulations in connection with the opening of import letters of credit. Margin Deposits Import Letters of Credit Foreign Regular 1/ This represents non-interest bearing foreign currency deposits required of importers under existing rules and regulations in connection with the opening of import letters of credit, which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Margin Deposits Customers' Liability on Bills/Drafts under Letters of Credit and/or Trust Receipts This represents margin deposits corresponding to negotiations on letters of credit evidenced by import bills and/or trust receipts. Margin Deposits Foreign This represents margin deposits with foreign branches/agencies of the reporting bank which shall be recorded at their foreign currency amounts. LLpr Margin Deposits Others This represents margin deposits which cannot be appropriately classified under any of the foregoing "Margin Deposit" accounts. 35. CASH LETTERS OF CREDIT [2-3-16-00] Cash Letters of Credit Domestic This represents import letters of credit issued where the importer pays 100% in pesos. Cash Letters of Credit Foreign Regular 1/ This represents import letters of credit issued where the importer pays 100% in foreign currency. This account shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. 36. SPECIAL TIME DEPOSITS [2-3-18-00] This represents non-interest bearing deposits used as security for IGLF purposes. 37. ACCRUED INTEREST, FRINGE BENEFITS, TAXES AND OTHER EXPENSES PAYABLE [2-3-20-00] a. Accrued Interest Payable [2-3-20-02] Accrued Interest Payable Domestic This represents the estimated liability for interest incurred/due but not yet paid on demand, savings and time deposits and on domestic borrowings which shall be set up monthly against current operations. LLjur Accrued Interest Payable Foreign Regular 1/ This represents the estimated liability for interest incurred/due but not yet paid on foreign borrowings, which shall be set up monthly against current operations. This account shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. Accrued Interest Payable FCDU/EFCDU This represents the estimated liability for interest incurred/due but not yet paid on demand, savings, time deposits and on foreign borrowings by FCDUs/EFCDUs which shall be set up against current operations. Accrual shall be recorded at their foreign currency amounts. Sub-control accounts shall be maintained for interest due to the foreign bank not yet paid but covered with forward contract with the Bangko Sentral. b. Accrued Fringe Benefits Payable [2-3-20-03] This represents the estimated liability for any good, service, or other benefit furnished or granted by the bank, in cash or in kind, in addition to basic salaries, to its directors and officers such as, but not limited to housing; expense account; vehicle of any kind; household personnel, such as maid, driver and others; interest on loan at less than market rate to the extent of the difference between the market rate and actual rate granted; membership fees, dues and other expenses borne by the bank for its directors/officers in social and athletic clubs or other similar organizations; expenses for foreign travel; holiday and vacation expenses; educational assistance to directors/officers or their dependents; and life or health insurance and other non-life insurance premiums or similar amounts in excess of what the law allows, in accordance with BIR regulations, which were accrued but not yet paid. LibLex c. Accrued Fringe Benefits Tax Payable [2-3-20-04] This represents the estimated liability for final withholding tax imposed on the grossed-up monetary value of any good, service, or other benefit furnished or granted by the bank, in cash or in kind, in addition to basic salaries, to its directors and officers such as, but not limited to housing; expense account; vehicle of any kind; household personnel, such as maid, driver and others; interest on loan at less than market rate to the extent of the difference between the market rate and actual rate granted; membership fees, dues and other expenses borne by the bank for its directors/officers in social and athletic clubs or other similar organizations; expenses for foreign travel; holiday and vacation expenses; educational assistance to directors/officers or their dependents; and life or health insurance and other non-life insurance premiums or similar amounts in excess of what the law allows, in accordance with BIR regulations, which were accrued but not yet paid. d. Accrued Income Tax Payable [2-3-20-05] This represents the estimated liability for income tax which shall be set up monthly against current operations. e. Accrued Other Taxes and Licenses Payable [2-3-20-06] This represents the estimated liability for taxes and licenses, other than income tax, which shall be set up against current operations. f. Accrued Other Expenses Payable [2-3-20-08] Accrued Other Expenses Payable Domestic This represents the estimated liability for unpaid expenses, other than those for taxes and interest, which shall be set up monthly against current operations. Accrued Other Expenses Payable Foreign Regular 1/ This represents the estimated liability for unpaid expenses, other than those for taxes and interest, which shall be set up monthly against current operations. This account shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing at the end of the month. prLL MISSING PAGES 36-39 Deposit for Margin on Financial Futures FCDU/EFCDU This represents the initial margin collected/received by the bank as broker at the inception of the contract. At liquidation, this deposit is refundable. This shall be recorded at its foreign currency amount. l. Payable to Broker (Futures) [2-3-52-00] This represents the clearing accounts with various brokers for the settlement of margin calls, brokerage fees and profits/(losses) from futures trading and hedging during the month. Cash settlement may be done daily (as in the case of SIMEX), monthly (as in the case of LIFFE), or periodically as agreed with each respective broker. m. Deposit for Stock Subscription [2-3-54-00] This represents payments made by stockholders of the bank on subscription to the increase in the authorized capital which cannot be directly credited to "Common Capital Stock Paid-in" account pending approval by the Bangko Sentral and registration with the Securities and Exchange Commission of the amendment to the Articles of Incorporation increasing capital stock. This account will be used only when existing authorized capital is already fully subscribed. LLcd n. Inter-office Float Items (Credit Balances) [2-3-56-00] This represents the credit balance difference between the Due to Head Office/Branches/Agencies and Due from Head Office/Branches/Agencies accounts resulting from the elimination of reciprocal accounts in the consolidation process. This account shall be used only for consolidated statements. Sub-control accounts shall be maintained for the following: (a) Domestic; (b) Foreign Regular and (c) FCDU/EFCDU. o. Miscellaneous Liabilities [2-3-58-00] Miscellaneous Liabilities This represents items/transactions which cannot be appropriately classified under any of the foregoing liability accounts. Miscellaneous Liabilities FCDU/EFCDU This represents items/transactions which cannot be appropriately classified under any of the foregoing FCDU/EFCDU liability accounts which shall be recorded at their respective foreign currency amounts. LLphil Copied verbatim from documents directly obtained from the Bangko Sentral ng Pilipinas . 45. SURPLUS RESERVES [3-2-04-00] a. Reserve for Trust Business [3-2-04-02] This represents the accumulated amount set aside under Section 66 of R.A. No. 337, as amended, requiring the bank to carry to surplus ten per cent (10%) of its net profits accruing from trust business since the last preceding dividend declaration until the surplus shall amount to twenty per cent (20%) of its authorized capital stock. b. Reserve for Self-Insurance [3-2-04-04] This represents the accumulated amount set aside to cover losses due to fire, defalcation by and other unlawful acts of the bank's officers/employees and/or third parties. c. Reserve for Contingencies [3-2-04-06] This represents the accumulated amount set aside for possible or unforeseen losses, decrease or shrinkage in the book value of the bank's assets, or for undeterminable liabilities no otherwise recorded, such as those arising from lawsuits, defaults on obligations and unexpected expenditures. d. Other Surplus Reserves [3-2-04-08] This represents the accumulated amount set aside for purposes other than those stated in the aforementioned "Surplus Reserves" accounts. 46. UNDIVIDED PROFITS [3-3-02-00] Undivided Profits This represents the clearing account for all income and expenses, the balance of which shall be transferred to "Surplus Free" account at the end of the accounting period after taking up all other charges and/or credits that may be appropriately cleared through this account. Undivided Profits FCDU/EFCDU This represents the clearing account for all income and expenses involving transactions under the FCDU/EFCDU, the balance of which shall be transferred to "Surplus Free" account at the end of the accounting period after taking up all other charges and/or credits that may be appropriately cleared through this account. cdlex 46-a. NET UNREALIZED GAINS/(LOSSES) ON SECURITIES AVAILABLE FOR SALE [3-3-03-00] Net Unrealized Gains/(Losses) on Securities Available for Sale Local Currency This represents the contra account of "Accumulated Market Gains/(Losses) Underwritten Debt Securities Purchased", "Accumulated Market Gains/(Losses) Underwritten Equity Securities Purchased", "Accumulated Market Gains/(Losses) ASS Government Issue" and "Accumulated Market Gains/(Losses) ASS Private Issue" resulting from the fair market valuation of "Underwriting Accounts (UA) Debt Securities for EKBs", "Underwriting Accounts (UA) Equity Securities for EKBs", "Available for Sale Securities Government" and "Available for Sale Securities Private", respectively. The account is credited for gains and debited for losses. Sub-control accounts shall be maintained for (1) Net Unrealized Gains/(Losses) on Securities Available for Sale Underwritten Debt Securities Purchased; (2) Net Unrealized Gains/(Losses) on Securities Available for Sale Underwritten Equity Securities Purchased; (3) Net Unrealized Gains/(Losses) on Securities Available for Sale ASS Government Issue; and, (4) Net Unrealized Gains/(Losses) on Securities Available for Sale ASS Private Issue. cdll Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed except in the case of transfers from "Underwriting Accounts (UA) Debt Securities for EKBs", "Available for Sale Securities Government" and "Available for Sale Securities Private" to "Investments in Bonds and Other Debt Instruments Government" or "Investments in Bonds and Other Debt Instruments Private", where it shall continue to be reported in this account and shall be amortized over the remaining life of the security as an adjustment to yield in a manner consistent with the amortization of any premium or discount. Net Unrealized Gains/(Losses) on Securities Available for Sale Foreign Regular This represents the contra account of "Accumulated Market Gains/(Losses) ASS Foreign Regular" resulting from the fair market valuation of "Available for Sale Securities Foreign Regular". The account is credited for gains and debited for losses, which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed except in the case of transfers from "Available for Sale Securities Foreign Regular" to "Investments in Bonds and Other Debt Instruments Foreign Regular", where it shall continue to be reported in this account and shall be amortized over the remaining life of the security as an adjustment to yield in a manner consistent with the amortization of any premium or discount. LibLex Net Unrealized Gains/(Losses) on Securities Available for Sale FCDU/EFCDU This represents the contra account of "Accumulated Market Gains/(Losses) ASS FCDU/EFCDU" resulting from the fair market valuation of "Available for Sale Securities FCDU/EFCDU". The account is credited for gains and debited for losses, which shall be recorded at their foreign currency amounts. Upon the disposition of the securities, the account corresponding to the sold or transferred securities shall be reversed except in the case of transfers from "Available for Sale Securities FCDU/EFCDU" to "Investments in Bonds and Other Debt Instruments FCDU/EFCDU", where is shall continue to be reported in this account and shall be amortized over the remaining life of the security as an adjustment to yield in a manner consistent with the amortization of any premium or discount. This account shall be maintained in the FCDU/EFCDU books and shall be consolidated with that of the bank proper for report/statement purposes. 47. APPRAISAL INCREMENT RESERVE [3-3-04-00] This is the contra-account of "Bank Premises Appraisal Increment" account. This is also known as "Revaluation Reserve" under existing rules and regulations which shall not form part of the combined capital accounts of the bank. 48. ASSIGNED CAPITAL (FOREIGN BANKS) [3-3-06-00] This represents the capital permanently assigned by a foreign bank to its branch(es) operating in the Philippines, pursuant to Section 68 of R.A. No. 337, as amended and Section 4 of R.A. No. 7721. i. Interest Income Trading Accounts Securities (TAS) Loans [5-0-02-18] This represents interest earned and/or actually collected on trading account securities loans. j. Interest Income Deposits in Banks [5-0-02-20] This represents interest earned and credited to the bank's demand and savings deposits and interest earned and actually collected on time deposits in other banks. cdt Interest Income Deposits in Local Banks Interest Income Deposits in Local Banks This represents interest earned and credited to the bank's demand and savings deposits and interest earned and actually collected on time deposits in local banks. Interest Income Deposits in Local Banks FCDU/EFCDU This represents interest earned and credited to the bank's demand and savings deposits and interest earned and actually collected on time deposits in local banks for transactions of FCDU/EFCDU which shall be recorded at their respective foreign currency amounts. Interest Income Deposits in Foreign Banks Interest Income Deposits in Foreign Banks This represents interest earned, credited to and/or actually collected on the bank's deposits in foreign banks which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. LLpr Interest Income Deposits in Foreign Banks FCDU/EFCDU This represents interest earned, credited to and/or actually collected on the bank's deposits in foreign banks under the FCDU/EFCDU system which shall be recorded at their foreign currency amounts. k. Interest Income Due from Bangko Sentral ng Pilipinas (BSP) [5-0-02-22] Interest Income Due from BSP Local Currency Interest Income Due from BSP Local Currency Regular This represents interest earned on and credited to the local currency deposit with the BSP. Interest Income Due from BSP Local Currency FCDU/EFCDU This represents interest earned on and credited to the local currency deposit with the BSP derived from the proceeds of FCDU/EFCDU foreign currency deposits swapped with Bangko Sentral. aisadc Interest Income Due from BSP Foreign Currency Interest Income Due from BSP ; Foreign Currency Regular This represents interest earned on and credited to the foreign currency deposit with the BSP which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Interest Income Due from BSP Foreign Currency FCDU/EFCDU This represents interest earned on and credited to the foreign currency deposit with the BSP which shall be recorded at their foreign currency amounts. l. Interest Income Trading Account Securities (TAS) Investments [5-0-02-24] Interest Income TAS Investments Local Currency This represents interest earned and/or actually collected on trading account securities investments held by the bank. LibLex Interest Income Tax-Exempt TAS Investments This represents interest earned and/or actually collected on tax-exempt trading account securities investments. Interest Income Taxable TAS Investments This represents interest earned and/or actually collected on taxable trading account securities investments. Interest Income TAS Investments Foreign Regular This represents interest earned and/or actually collected in foreign currency-denominated trading account securities investments held by the bank which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. Interest Income TAS Investments FCDU/EFCDU This represents interest earned and/or actually collected on foreign currency-denominated trading account securities-investments held by the FCDU/EFCDU which shall be recorded at their foreign currency amounts. l-a. Interest Income Available for Sale Securities (ASS) [5-0-02-25] Interest Income ASS Local Currency This represents interest earned and/or actually collected on available for sale securities held by the bank. cdlex Interest Income Tax-Exempt ASS This represents interest earned and/or actually collected on tax-exempt available for sale securities. Interest Income Taxable ASS This represents interest earned and/or actually collected on taxable available for sale securities. Interest Income ASS Foreign Regular This represents interest earned and/or collected on foreign currency-denominated available for sale securities held by the bank which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. Interest Income ASS FCDU/EFCDU This represents interest earned and/or actually collected on foreign currency-denominated available for sale securities held by the FCDU/EFCDU which shall be recorded at their foreign currency amounts. m. Interest Income Investments in Bonds and Other Debt Instruments (IBODI) [5-0-02-26] Interest Income IBODI Local Currency This represents interest earned and/or actually collected on investments in bonds and other debt instruments held by the bank. Interest Income Tax-Exempt IBODI This represents interest earned and/or actually collected on tax-exempt investments in bonds and other debt instruments. Interest Income Taxable IBODI This represents interest earned and/or actually collected on taxable investments in bonds and other debt instruments. Interest Income IBODI Foreign Regular This represents interest earned and/or actually collected on foreign currency-denominated bonds and other debt instruments held by the bank which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange prevailing on transaction dates. LLjur Interest Income IBODI FCDU/EFCDU This represents interest earned and/or actually collected on foreign currency-denominated bonds and other debt instruments held by the FCDU/EFCDU which shall be recorded at their foreign currency amounts. n. Interest Income Others [5-0-02-40] This represents interest earned and/or actually collected on all receivable accounts other than loans such as accounts receivable, sales contract receivables and others. 76. BANK COMMISSIONS [5-0-04-00] This represents commission collected for services rendered as in: a. opening of letters of credit b. handling of collection items, domestic/export/import bills and telegraphic transfers c. sale of demand drafts, traveller's checks and government securities. 77. SERVICE CHARGES/FEES [5-0-06-00] This represents charges/fees, including commitment fees, collected for services rendered as in: a. handling of loans transactions and returned checks b. sale of manager's checks. 78. FEES/COMMISSIONS [5-0-08-00] This represents fees and commissions earned and collected for services rendered in connection with the investment house functions of the bank such as underwriting, securities dealership and equity investments. Sub-control accounts shall be maintained for (a) Fees/Commissions Derivative Transactions and (b) Fees/Commissions Others. cdll 79. TRADING GAIN/(LOSS) [5-0-10-00] Trading Gain/(Loss) Government Securities Trading Gain/(Loss) Government Securities Local Currency This represents gain or loss on government securities traded by the bank. Trading Gain/(Loss) Government Securities Foreign Currency Trading Gain/(Loss) Government Securities Foreign Regular This represents gain or loss on foreign currency-denominated government securities traded by the bank which shall be recorded at their foreign currency amounts at their local currency equivalent at the applicable rate of exchange on transaction dates. Trading Gain/(Loss) Government Securities FCDU/EFCDU This represents gain or loss on foreign currency-denominated government securities traded by the FCDU-EFCDU which shall be recorded at their foreign currency amounts. Trading Gain/(Loss) Private Debt Securities/Commercial Papers/Equity Securities Trading Gain/(Loss) Private Debt Securities/Commercial Papers/Equity Securities Local Currency This represents gain or loss on private debt securities/commercial papers/equity securities traded by the bank. LibLex Trading Gain/(Loss) Equity Securities Foreign Currency Trading Gain/(Loss) Equity Securities Foreign Regular This represents gain or loss on foreign currency-denominated equity securities traded by the bank which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Trading Gain/(Loss) Financial Futures/Options/Forwards/Swaps Trading Gain/(Loss) Financial Futures/Options/Forwards/Swaps Foreign Regular This represents trading profits and losses (both realized and "Mark-to-Market") arising from financial futures/options/forward/swap trading transactions which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Trading Gain/(Loss) Financial Futures/Options/Forwards/Swaps FCDU/EFCDU This represents trading profits and losses (both realized and "Mark-to-Market") arising from financial futures/options/forward/swap trading transactions of the FCDU/EFCDU which shall be recorded at their foreign currency amounts. LLcd 80. FOREIGN EXCHANGE PROFIT/(LOSS) [5-0-12-00] Foreign Exchange Profit/(Loss) This represents realized profit or actual loss incurred on foreign exchange transactions, including profit or loss arising from the adjustment of the peso equivalent of foreign monetary accounts consisting of foreign currencies on hand, due from foreign banks and short-term (collectible/payable within one year) receivables/payables. Sub-controls should be maintained from actual profit/(loss) and profit/(loss) arising from revaluation. Foreign Exchange Profit/(Loss) FCDU/EFCDU This represents realized profit or actual loss incurred on foreign exchange transactions under the FCDU/EFCDU system, including profit or loss arising from the adjustment of the peso equivalent of foreign monetary accounts consisting of foreign currencies on hand, due from foreign banks and short-term (collectible/payable within one year) receivables/payables. Sub-controls should be maintained from actual profit/(loss) and profit/(loss) arising from revaluation. 81. GOLD TRADING GAIN/(LOSS) [5-0-14-00] This represents profit or loss arising from gold trading transactions. 82. PROFIT/(LOSS) ON SALE OR REDEMPTION OF INVESTMENTS [5-0-16-00] This represents profits earned or loss incurred on the sale or redemption of investments. Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments Local Currency This represents profits earned or loss incurred on the sale or redemption of investments in government bonds and other debt instruments. Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments Foreign Currency Profit/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments Foreign Regular This represents profits earned or loss incurred on the sale or redemption of investments in foreign currency-denominated government bonds and other debt instruments which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Profits/(Loss) on Sale or Redemption of Investments Government Bonds and Other Debt Instruments FCDU/EFCDU This represents profits earned or loss incurred on the sale or redemption of investments in foreign currency-denominated government bonds and other debt instruments of the FCDU/EFCDU which shall be recorded at their foreign currency amounts. Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Instruments Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Instruments Local Currency This represents profits earned or loss incurred on the sale or redemption of investments in private bonds and other debt instruments. Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Instruments Foreign Currency Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Instruments Foreign Regular This represents profits earned or loss incurred on the sale or redemption of foreign currency-denominated investments in private bonds and other debt instruments which shall be recorded at their foreign currency amounts and at their local currency equivalent at the applicable rate of exchange on transaction dates. Profit/(Loss) on Sale or Redemption of Investments Private Bonds and Other Debt Instruments FCDU/EFCDU This represents profits earned or loss incurred on the sale or redemption of foreign currency-denominated investments in private bonds and other debt instruments of the FCDU/EFCDU which shall be recorded at their foreign currency amounts. Profit/(Loss) on Sale or Redemption of Investments Equity Securities This represents profits earned or loss incurred on the sale of equity securities. Interest Expense Bills Payable Others Interest Expense Bills Payable Others Domestic Interest Expense Bills Payable Non-Banks This represents payments and/or monthly accruals of interest on outstanding bills payable to non-bank financial intermediaries. Interest Expense Bills Payable - Private Firms and Individuals This represents payments and/or monthly accruals of interest on outstanding bills payable to individuals and other private firms (other than banks and non-bank financial intermediaries). Interest Expense Bills Payable Others This represents payments and/or monthly accruals of interest on outstanding local bills payable which cannot be appropriately classified under any of the foregoing "Interest Expense Bills Payable" accounts. Interest Expense Bills Payable Others Foreign Interest Expense Bills Payable Others Foreign Regular This represents payments and/or monthly accruals of interest on outstanding foreign borrowings other than those obtained from foreign banks which shall be recorded at their foreign currency amounts and at their local foreign currency equivalent at the applicable rate of exchange on transaction dates. Interest Expense Bills Payable Others FCDU/EFCDU This represents payments and/or monthly accruals of interest on bills payable to foreign and local banks under the FCDU system which shall be recorded at their foreign currency amounts. c. Interest Expense on Bonds Payable [6-0-02-06] This represents payments and/or monthly accruals of interest on issued and outstanding bonds. d. Interest Expense Others [6-0-02-08] This represents payments and/or monthly accruals of interest other than on deposits and borrowed funds, such as the interest portion of amortization payments on the purchase of fixed assets on installment basis. 86. FINANCE CHARGES [6-0-04-00] This represents payments of finance and other charges on loans obtained, placements, promissory notes issued and other forms of obligations. 87. COMPENSATION/FRINGE BENEFITS [6-0-06-00] a. Salaries and Wages [6-0-06-02] This represents the gross remuneration of officers and employees for regular and overtime services rendered. b. Fringe Benefits Directors [6-0-06-04] This represents expenses for any good, service, or other benefit furnished or granted by the bank, in cash or in kind, in addition to basic salaries, to its directors such as, but not limited to housing; expense account; vehicle of any kind; household personnel, such as maid, driver and others; interest on loan at less than market rate to the extent of the difference between the market rate and actual rate granted; membership fees, dues and other expenses borne by the bank for its directors in social and athletic clubs or other similar organizations; expenses for foreign travel; holiday and vacation expenses; educational assistance to directors or their dependents; and life or health insurance and other non-life insurance premiums or similar amounts in excess of what the law allows, in accordance with BIR regulations. Cdphil c. Fringe Benefits Officers [6-0-06-06] This represents expenses for any good, service, or other benefit furnished or granted by the bank, in cash or in kind, in addition to basic salaries, to its officers such as, but not limited to housing; expense account; vehicle of any kind; household personnel, such as maid, driver and others; interest on loan at less than market rate to the extent of the difference between the market rate and actual rate granted; membership fees, dues and other expenses borne by the bank for the officers in social and athletic clubs or other similar organizations; expenses for foreign travel; holiday and vacation expenses; educational assistance to officers or their dependents; and life or health insurance and other non-life insurance premiums or similar amounts in excess of what the law allows, in accordance with BIR regulations. c-a. Fringe Benefits Employees [6-0-06-07] This represents expenses for allowances and other fringe benefits granted to employees in accordance with management policy such as bonuses, profits shared, including those for special studies/seminars, but excluding medical, dental and hospitalization benefits. d. Directors' Fees [6-0-06-08] This represents per diems and fees granted to directors in accordance with management policy. e. SSS, Medicare and Employees' Compensation Premiums and Pag-IBIG Fund Contributions [6-0-06-10] This represents the bank's share in the Social Security System, Medicare, Employees' Compensation premiums and Pag-IBIG Fund contributions of its officers and employees. f. Medical, Dental and Hospitalization [6-0-06-12] This represents expenses for medical and dental services, including cost of medicines, hospital bills and other related expenses incurred by the bank, in accordance with management policy for and in behalf of its officers and employees and their dependents. g. Contributions to Retirement/Provident Fund [6-0-06-14] This represents the bank's contributions to the retirement/provident fund or any similar fund for its personnel. 88. MANAGEMENT AND OTHER PROFESSIONAL FEES [6-0-08-00] This represents expenses for services rendered by individuals/firms on a retainer/contractual basis such as the managing company, legal counsel, external auditors and consultants. LibLex 89. BANKING FEES [6-0-10-00] This represents the bank's share in the cost of maintaining the appropriate supervising and examining department of the Bangko Sentral. 90. FINES, PENALTIES AND OTHER CHARGES [6-0-12-00] This represents fines, penalties and other charges imposed on the bank under existing rules and regulations such as fines/penalties for reserve deficiencies and late submission or reports. 91. TAXES AND LICENSES [6-0-14-00] This represents expenses for taxes and licenses other than income tax such as corporate residence tax, motor vehicles registration fee, privilege tax, firearms tax, gross receipts tax and other taxes. 91-a. FRINGE BENEFITS TAXES [6-0-15-00] This represents expenses for the final withholding tax imposed on the grossed-up monetary value of any good, service, or other benefit furnished or granted by the bank, in cash or in kind, in addition to basic salaries, to its directors and officers such as, but not limited to housing; expense account; vehicle of any kind; household personnel, such as maid, driver and others; interest on loan at less than market rate to the extent of the difference between the market rate and actual rate granted; membership fees, dues and other expenses borne by the bank for its directors/officers in social and athletic clubs or other similar organizations; expenses for foreign travel; holiday and vacation expenses; educational assistance to directors/officers and their dependents; and life or health insurance and other non-life insurance premiums or similar amounts in excess of what the law allows, in accordance with BIR regulations. LLcd Foreign currency-denominated assets, liabilities and forward contracts (including accounts of FCDU and branches abroad of domestic banks) shall be revalued in accordance with the following guidelines: 1. All monetary accounts, whether short-term or long-term, shall be revalued and foreign exchange profit/(loss) recognized therefrom. For purposes of revaluation, monetary accounts refer to foreign currencies on hand, due from foreign banks, receivables, payables and all other accounts to be received or paid in money. 2. Non-monetary accounts such as equity investments, bank premises, furniture, fixtures and equipment, fixed assets and other accounts not falling under the definition of monetary accounts under Item 1 above are to be carried at historical cost/exchange rate and should not be revalued. 3. Past due accounts should not be revalued. 4. Revaluation shall be done at least monthly, using the Philippine Dealing System Weighted Average Rate (PDSWAR) subject to the following conditions: For US Dollar Foreign Exchange Assets and Liabilities a. Use the PDSWAR for the day as the revaluation rate, provided the absolute differential of PDSWAR with the Philippine Dealing System Closing Rate (PDSCR) is less than or equal to 2% of PDSWAR; b. If the absolute differential of PDSWAR and PDSCR is greater than 2% of PDSWAR, use PDSCR as the revaluation rate if the following conditions are present: 1) Total transactions for the day should at least be equal to $20.0 million; and 2) The volume of last transaction for the day should at least be equal to 15% of the total transactions for the day. Otherwise, use PDSWAR as the revaluation rate. 3) If there are no transactions for the day, use the immediately preceding applicable revaluation rate. For Non-US Dollar Foreign Currency Assets and Liabilities For non-US dollar foreign currency (third currency) assets and liabilities, use the designated Peso/US Dollar revaluation rate (as determined in Item a above) against the relevant US dollar/third currency rate in the BSP Reference Exchange Rate Bulletin for the day. Revaluation entries passed at the end of the month may be reversed the following day. 5. The exchange difference shall be recognized as "Foreign Exchange Profit/(Loss)". 6. Forward accounts shall be revalued using the revaluation rates as determined in item 4 above. Discounts and premiums on forward contracts should be separately accounted for and amortized to income/expenses over the life of the forward exchange contract. ANNEX B KB Revised 1. Consolidated Statement of Condition (CSOC)