Procedures for Obtaining a Certificate of Eligibility under the SPV Act, as amended

May 11, 2006 BSP MEMORANDUM NO. M-2006-001 MEMORANDUM TO ALL BANKS AND NON-BANK FINANCIAL INSTITUTIONS PERFORMING QUASI-BANKING FUNCTIONS (NBQBs) SUBJECT : Procedures for Obtaining a Certificate of Eligibility under the S PV A ct, as amended The Monetary Board, in its Resolution No. 549 dated 27 April 2006, approved the following procedures for banks/NBQBs that intend to transfer/sell their non-performing assets (NPAs) to a Special Purpose Vehicle (SPV) or to an individual that involves a single family residential unit, or transactions involving dacion en pago by the borrower or third party of a non-performing loan (NPL), for the purpose of obtaining a Certificate of Eligibility (COE) which is required to avail of the incentives provided under R.A. No. 9182, as amended by R.A. No. 9343. 1. Prior to the filing of any application for transfer/sale of NPAs, a bank/NBQB shall coordinate with the Bangko Sentral ng Pilipinas (BSP) through the Supervisory Data Center (SDC) and the appropriate Supervision and Examination Department (SED) to develop a reconciled and finalized master list of its eligible NPAs. For this purpose, banks/NBQBs were requested to submit a complete inventory of their NPAs in the format prescribed under Circular Letter dated 07 January 2003 (Attachments 1-1 to 1-6). Only NPAs included in the master list that meet the definition of NPA, NPL and Real and Other Properties Owned or Acquired (ROPOA) under R.A. No. 9182 may qualify for the COE. The banks/NBQBs shall be provided a copy of their reconciled and finalized master list for their guidance. Only banks/NBQBs which have not yet submitted their master list of NPAs and intend to avail of the incentives and fee privileges of the SPV Act 2nd Phase implementation are allowed to submit a complete inventory of their NPAs in the format prescribed under Circular Letter dated 7 January 2003. Banks/NBQBs which have already submitted to BSP a master list of NPAs as of 30 June 2002 in the 1st Phase implementation of the SPV Act will not be allowed to submit a new/amended master list. 2. An application for eligibility of specific NPAs shall be filed in writing (hard copy) by the selling bank/NBQB with the BSP through the appropriate SED for each proposed transfer of asset/s. Although no specific form is prescribed, the applicant shall describe in sufficient detail its proposed transaction, identifying its counterparty/ ies and disclosing the terms, conditions and all material commitments related to the transaction. 3. For applications involving more than ten (10) NPA accounts, the list of NPAs to be transferred/sold shall be submitted in soft copy (by electronic mail or diskette) in excel format using the attached prescribed data structure/format for NPLs and ROPOAs (Attachments 2-1 to 2-4) to the appropriate SED of the applicant bank/NBFI at the following addresses: [emailprotected] [emailprotected] [emailprotected] [emailprotected] For applications involving ten (10) NPA accounts or less, it is preferable that the list be submitted also in soft copy. The applicant may opt to submit the list in hard copy, provided all the necessary information shown in the prescribed data structure (Attachments 2-1 to 2-4) that are relevant to each NPL or ROPOA to be transferred/sold will be indicated. The list to be submitted in hard copy would be ideal for the sale/transfer of NPAs that involve one (1) promissory note and/or one (1) asset item per account. ACDIcS 4. The application shall be accompanied by a written certification signed by a senior officer with a rank of at least Senior Vice President or equivalent, who is authorized by the board of directors, or by the country head, in the case of foreign banks, that: a. the assets to be sold/transferred are NPAs as defined under the SPV Act of 2002; b. the proposed sale/transfer of said NPAs is under a true sale; c. the notification requirement to the borrowers has been complied with; and d. the maximum 90-day period for renegotiation and restructuring has been complied with. Items c and d above shall not apply if the NPL has become a ROPOA after 30 June 2002. 5. In the case of dacion en pago by the borrower or a third party to a bank/NBQB, the application for COE on the NPL being settled shall be accompanied by a Deed of Dacion executed by the borrower, the third party, the registered owner of the property and the bank/NBQB. 6. The appropriate SED may conduct an on-site review of the NPLs and ROPOAs proposed to be transferred/sold. After the on-site review, the application for transfer/sale shall be submitted to the Deputy Governor, Supervision and Examination Sector (SES) for approval and for the issuance of the corresponding Certificate of Eligibility (COE). 7. Upon the issuance of the SPV Application Number by the BSP, a bank/NBQB shall be charged a processing fee, as follows: i. 1/100 of 1% of the book value of NPAs transferred or the transfer price, whichever is higher, but not below P25,000 if the transfer is made to an SPV; ii. 1/100 of 1% of the book value of the NPL but not below P5,000 in case of a dacion en pago arrangement by an individual or corporate borrower; iii. P5,000 if the transfer involves a single family residential unit to an individual. 8. An SPV that intends to transfer/sell to a third party an NPA that is covered by a COE previously issued by the BSP shall file an application for such transfer/sale with the Securities and Exchange Commission (SEC) which shall issue the corresponding COE based on the data base of COEs maintained at the BSP. An individual who intends to transfer/sell an NPA that involves a single family residential unit he had acquired that is covered by a COE shall file an application for another COE with the BSP through the bank/NBQB from which the NPA was acquired. The individual shall indicate in his application the previous COE issued for the NPA he had acquired and the name, address and Taxpayer's Identification Number (TIN) of the transferee/buyer of the NPA. A processing fee of P5,000 shall be collected upon issuance of the SPV Application Number by the BSP. This Memorandum shall take effect after fifteen (15) calendar days following its publication in the Official Gazette or in a newspaper of general circulation. (SGD.) NESTOR A. ESPENILLA, JR. Deputy Governor ATTACHMENT 1-1 DATA STRUCTURE NON-PERFORMING LOANS (For Commercial Banks and Thrift Banks) File Name: FRM1XXXX.dbf 1/ FIELD FIELD NAME TYPE LENGTH DP DESCRIPTION VALID VALUES 1 REFDATE N 8 Reference Date Should be in the CCYYMMDD format 2 BORRNAME C 60 Borrower Name For individuals, separate by comma as in: Surname, First Name, Middle Name For institutions, do not use abbreviations or acronyms; use SEC registered names or the list of borrower names as per CREDEX report (refer to Circular Letter dated May 24, 2001) Use uppercase fonts. 3 BORRTIN C 20 Borrower's T.I.N.* Dash (-) in T.I.N. should not be included Ex. T.I.N. 135-958-913 should be encoded as 135954913 4 OSPESO N 15 2 Outstanding Amount in Peso/Peso Equiv. 5 LOANTYPE N 2 Loan Type 11 PAST DUE LOAN (PDL) 12 ITEMS IN LITIGATION (ITL) 13 RESTRUCTURED LOAN (RL) 6 BOOKDTE N 8 Date Booked as PDL, ITL or RL 7 AMTSEC N 15 2 Amount Secured Sum of AMTSEC and AMTUNSEC should equal the OSPESO amount. At no time should any of these be less than zero. 8 AMTUNSEC N 15 2 Amount Unsecured 9 BKCODE N 6 Bank Code First two bytes = 00 for Commercial Banks 05 for Specialized Government Banks 01 for Savings & Mortgage Banks 02 for Private Development Banks 03 for Stock Savings & Loan Association 07 for Microfinance Thrift Banks Next four (4) bytes = refer to list of valid bank codes *For borrowers without T.I.N., please obtain T.I.N. from B.I.R. 1/ where XXXX is the reference period in the MMMY format. Ex. Filename for: December 31, 2001 is FRM1DEC1.dbf June 30, 2002 is FRM1JUN2.dbf ATTACHMENT 1-2 DATA STRUCTURE Real and Other Properties Owned or Acquired (ROPOA) (For Commercial and Thrift Banks) File Name: FRM2XXXX.dbf 1/ FIELD FIELD NAME TYPE LENGTH DP DESCRIPTION VALID VALUES 1 REFDATE N 8 Reference Date Should be in the CCYYMMDD format 2 FRMRBORR C 60 Name of Former For individuals, separate by comma as in: Borrower Surname, First Name, Middle Name For institutions, do not use abbreviations or acronyms; use SEC registered names or the list of borrower names as per CREDEX report (refer to Circular Letter dated May 24, 2001) Use uppercase fonts. 3 FMRBRTIN C 20 T.I.N. of Former Dash (-) in T.I.N. should not be included Borrower* Ex. T.I.N. 135-958-913 should be encoded as 135954913 4 BKVALUE N 15 2 Book value in Peso/Peso Equiv. 5 TYPROP N 2 Type of Property 21 Real Estate 22 Chattels 23 Others 6 PRPAPAMT N 15 2 Latest Appraised Value of Property 7 PRPAPDTE N 8 Latest Appraisal Date Should be in the CCYYMMDD format. of Property 8 CONDTE N 8 Date when title to Should be in CCYYMMDD format or property was 99999999 if not consolidated. consolidated in name of bank 9 VALRES N 15 2 Booked Valuation Reserve 10 BKCODE N 6 Bank Code First two bytes = First two bytes = 00 for Commercial Banks 05 for Specialized Government Banks 01 for Savings & Mortgage Banks 02 for Private Development Banks 03 for Stock Savings & Loan Association 07 for Microfinance Thrift Banks Next four (4) bytes = refer to list of valid bank codes *For borrowers without T.I.N., please obtain T.I.N. from B.I.R. 1/ where XXXX is the reference period in the MMMY format. Ex. Filename for: December 31, 2001 is FRM2DEC1.dbf June 30, 2002 is FRM2JUN2.dbf ATTACHMENT 1-3 DATA STRUCTURE NON-PERFORMING LOANS (For NBQBs) File Name: NBF1XXXX.dbf 1/ FIELD FIELD NAME TYPE LENGTH DP DESCRIPTION VALID VALUES 1 REFDATE N 8 Reference Date Should be in the CCYYMMDD format 2 BORRNAME C 60 Borrower Name For individuals, separate by comma as in: Surname, First Name, Middle Name For institutions, do not use abbreviations or acronyms; use SEC registered names or the list of borrower names as per CREDEX report (refer to Circular Letter dated May 24, 2001) Use uppercase fonts. 3 BORRTIN C 20 Borrower's T.I.N.* Dash (-) in T.I.N. should not be included Ex. T.I.N. 135-958-913 should be encoded as 135954913 4 OSPESO N 15 2 Outstanding Amount in Peso/Peso Equiv. 5 LOANTYPE N 2 Loan Type 11 PAST DUE LOAN (PDL) 12 ITEMS IN LITIGATION (ITL) 13 RESTRUCTURED LOAN (RL) 6 BOOKDTE N 8 Date Booked as PDL, ITL or RL 7 AMTSEC N 15 2 Amount Secured Sum of AMTSEC and AMTUNSEC should equal the OSPESO amount. At no time should any of these be less than zero. 8. AMTUNSEC N 15 2 Amount Unsecured 9 BKCODE N 6 Bank Code First two bytes = 19 for NBQB-IH 20 for NBQB-FC Next four (4) bytes = refer to list of valid bank codes *For borrowers without T.I.N., please obtain T.I.N. from B.I.R. 1/ where XXXX is the reference period in the MMMY format. Ex. Filename for: December 31, 2001 is NBF1DEC1.dbf June 30, 2002 is NBF1JUN2.dbf ATTACHMENT 1-4 DATA STRUCTURE Real and Other Properties Owned or Acquired (ROPOA) (For NBQBs) File Name: NBF2.dbf 1/ FIELD FIELD NAME TYPE LENGTH DP DESCRIPTION VALID VALUES 1 REFDATE N 8 Reference Date Should be in the CCYYMMDD format 2 FRMRBORR C 60 Name of Former For individuals, separate by comma as in: Borrower Surname, First Name, Middle Name For institutions, do not use abbreviations or acronyms; use SEC registered names or the list of borrower names as per CREDEX report (refer to Circular Letter dated May 24, 2001) Use uppercase fonts. 3 FMRBRTIN C 20 T.I.N. of Former Dash (-) in T.I.N. should not be included Borrower* Ex. T.I.N. 135-958-913 should be encoded as 135954913 4 BKVALUE N 15 2 Book value in Peso/Peso Equiv. 5 TYPROP N 2 Type of Property 21 Real Estate 22 Chattels 23 Others 6 PRPAPAMT N 15 2 Latest Appraised Value of Property 7 PRPAPDTE N 8 Latest Appraisal Date Should be in the CCYYMMDD format. of Property 8 CONDTE N 8 Date when title to Should be in CCYYMMDD format or property was 99999999 if not consolidated. consolidated in name of bank 9 VALRES N 15 2 Booked Valuation Reserve 10 BKCODE N 6 Bank Code First two bytes = 19 for NBQB-IH 20 for NBQB-FC Next four (4) bytes = refer to list of valid bank codes *For borrowers without T.I.N., please obtain T.I.N. from B.I.R. 1/ where XXXX is the reference period in the MMMY format. Ex. Filename for: December 31, 2001 is NBF2DEC1.dbf June 30, 2002 is NBF2JUN2.dbf ATTACHMENT 1-5 ATTACHMENT 1-6 ATTACHMENT 2-1 DATA STRUCTURE NON-PERFORMING LOANS File Name: NPLHEAD.xls FIELD FIELD FIELD FIELD DP DESCRIPTION REMARKS NUMBER NAME TYPE LENGTH 1 BKCODE N 6 0 Bank Code First two bytes = 00 for Commercial Banks 05 for Specialized Government Banks 01 for Savings and Mortgage Banks 02 for Private Development Banks 03 for Stock Savings & Loan Associations 07 for Microfinance Thrift Banks 04 for Rural Banks/Cooperative Banks 08 for Microfinance Rural Banks 19 for NBQB - Investment Houses 20 for NBQB - Finance Companies Next four (4) bytes = refer to list of valid bank codes 2 BORRNAME C 60 Borrower's Name For individuals, separate by comma as in: SURNAME, FIRST NAME, MIDDLE NAME For institutions, do not use abbreviations or acronyms; use SEC registered names or the list of borrower names as per CREDEX report (refer to Circ. Letter dated May 24, 2001) Use uppercase fonts 3 BORRTIN C 20 Borrower's T.I.N. Dash ( - ) in T.I.N. should not be included ex. 135-958-913 should be reported as 135958913 Valid values: T.I.N. assigned by BIR or unique T.I.N. assigned by the bank (refer to Circular Letter dated April 21, 2003 4 BORRADR C 60 Borrower's Address 5 LOANTYPE N 2 0 Loan Type 11 = Past Due Loan (PDL) 12 = Items in Litigation (ITL) 13 = Restructured Loans (RL) 6 BOOKDTE N 8 0 Date Booked as Should be in the CCYYMMDD format PDL, ITL, or RL 7 PNNUM C 20 PN Number Dash ( - ) in PN number should not be included Zeroes at the beginning of the PN number are included 8 PNDATE N 8 0 PN Date Should be in the CCYYMMDD format 9 OSPESO N 15 2 Outstanding Balance as of June 30, 2002. These accounts Amount should have been past due for at least 180 days as in Peso/Peso of June 30, 2002 Equiv.per PN 10 AMTSEC N 15 2 Amount Secured per PN Sum of AMTSEC and AMTUNSEC should equal the OSPESO amount. At no time should any of 11 AMTUNSEC N 15 2 Amount Unsecured these be less than zero per PN Important : If a particular field is not applicable to the account, leave as blank for character-type fields and put zero for numeric-type fields. ATTACHMENT 2-2 DATA STRUCTURE NON-PERFORMING LOANS File Name: NPLDET.xls FIELD FIELD FIELD FIELD DP DESCRIPTION REMARKS NUMBER NAME TYPE LENGTH 1 BKCODE N 6 0 Bank Code First two bytes = 00 for Commercial Banks 05 for Specialized Government Banks 01 for Savings and Mortgage Banks 02 for Private Development Banks 03 for Stock Savings & Loan Associations 07 for Microfinance Thrift Banks 04 for Rural Banks/Cooperative Banks 08 for Microfinance Rural Banks 19 for NBQB - Investment Houses 20 for NBQB - Finance Companies Next four (4) bytes = refer to list of valid bank codes 2 BORRTIN C 20 Borrower's Tin Dash ( - ) in T.I.N. should not be included Number ex. 135-958-913 should be reported as 135958913 Valid values: T.I.N. assigned by BIR or unique T.I.N. assigned by the bank (refer to Circular Letter dated April 21, 2003 3 LOANTYPE N 2 0 Loan Type 11 = Past Due Loan (PDL) 12 = Items in Litigation (ITL) 13 = Restructured Loans (RL) 4 BOOKDTE N 8 0 Date Booked as Should be in the CCYYMMDD format PDL, ITL, or RL 5 PNNUM C 20 PN Number Dash ( - ) in PN number should not be included Zeroes at the beginning of the PN number are included 6 PNDATE N 8 0 PN Date Should be in the CCYYMMDD format 7 TYPROP N 2 0 Type of Collateral 21 = Real Estate 22 = Chattels 23 = Others 8 TYPE1 N 1 0 Sub-category of For Real Estate: collateral 1 = Land Only 2 = Building/Improvement 3 = Land with Improvement For Chattel: 4 = Shares of Stocks 5 = Commercial Papers 6 = Motor Vehicles 7 = Machinery & Equipment 8 = Inventories 0 = For Others For Collateral type = REAL ESTATE 9 TYPE2 N 1 0 Sub-Collateral Type 1=Residential 2=Commercial 3=Agricultural 10 TCTNUM C 20 TCT Number Dash ( - ) in TCT Num should not be included 11 TAXDN C 20 Tax Declaration Dash ( - ) in Tax Declaration Num should Number not be included 12 OWNER C 60 Registered Owner 13 LOCATION C 60 Location of Property 14 AREA C 20 Area of Property Indicate unit of measure For Collateral type = CHATTELS (Shares of Stocks/Commercial Papers) 15 ISSUER C 45 Name of Issuer 16 SHARES N 10 0 Number of Shares 17 CERTNUM C 20 Certificate Number Dash ( - ) in Certificate Num should not be included 18 FACEVAL N 15 2 Face Value For Commercial Papers 19 MATDATE N 8 0 Maturity Date For Commercial Papers For Collateral type = CHATTELS (Motor Vehicle) 20 CRNUM C 20 Vehicle Dash ( - ) in Registration Num should not Registration No. be included 21 MOTORN C 20 Motor No. Dash ( - ) in Motor Num should not be included 22 CHASSIS C 20 Chassis No. Dash ( - ) in Chassis Num should not be included 23 PLATEN C 20 Plate No. 24 TYPEVE C 20 Type of Vehicle For Collateral type = CHATTELS (Machinery & Equipment/Inventories) Collateral type = OTHERS 25 DESC C 150 Description Include number of units and indicate unit of measure Important : If a particular field is not applicable to the account, leave as blank for character-type fields and put zero for numeric-type fields. ATTACHMENT 2-3 DATA STRUCTURE ROPOA File Name: ROPHEAD.xls FIELD FIELD FIELD FIELD DP DESCRIPTION REMARKS NUMBER NAME TYPE LENGTH 1 BKCODE N 6 0 Bank Code First two bytes = 00 for Commercial Banks 05 for Specialized Government Banks 01 for Savings and Mortgage Banks 02 for Private Development Banks 03 for Stock Savings & Loan Associations 07 for Microfinance Thrift Banks 04 for Rural Banks/Cooperative Banks 08 for Microfinance Rural Banks 19 for NBQB - Investment Houses 20 for NBQB - Finance Companies Next four (4) bytes = refer to list of valid bank codes 2 FRMRBORR C 60 Name of Former For individuals, separate by comma as in: Borrower SURNAME, FIRST NAME, MIDDLE NAME For institutions, do not use abbreviations or acronyms; use SEC registered names or the list of borrower names as per CREDEX report (refer to Circ. Letter dated May 24, 2001) Use uppercase fonts 3 FMRBRTIN C 20 Former Borrower's Dash ( - ) in T.I.N. should not be included T.I.N. ex. 135-958-913 should be reported as 135958913 Valid values: T.I.N. assigned by BIR or unique T.I.N. assigned by the bank (refer to Circular Letter dated April 21, 2003) 4 FMRBRADR C 60 Former Borrower's Address 5 TYPROP N 2 0 Type of Property 21=Real Estate 22=Chattels 23=Others 6 BKVALUE N 15 2 Book Value in Gross of Valuation Reserves Peso or Peso Balance as of June 30, 2002 Equivalent 7 PRPAPAMT N 15 2 Latest Appraised Value of Property 8 PRPAPDTE N 8 0 Latest Appraised Should be in the CCYYMMDD format Date of Property 9 CONDTE N 8 0 Date when title to Should be in the CCYYMMDD format or property was 99999999 if not consolidated consolidated in name of bank 10 VALRES N 15 2 Booked Valuation Reserves Important : If a particular field is not applicable to the account, leave as blank for character-type fields and put zero for numeric-type fields. ATTACHMENT 2-4 DATA STRUCTURE ROPOA File Name: ROPDET.xls FIELD FIELD FIELD FIELD DP DESCRIPTION REMARKS NUMBER NAME TYPE LENGTH 1 BKCODE N 6 0 Bank Code First two bytes = 00 for Commercial Banks 05 for Specialized Government Banks 01 for Savings and Mortgage Banks 02 for Private Development Banks 03 for Stock Savings & Loan Associations 07 for Microfinance Thrift Banks 04 for Rural Banks/Cooperative Banks 08 for Microfinance Rural Banks 19 for NBQB - Investment Houses 20 for NBQB - Finance Companies Next four (4) bytes = refer to list of valid bank codes 2 FMRBRTIN C 20 Borrower's T.I.N. Dash ( - ) in T.I.N. should not be included ex. 135-958-913 should be reported as 135958913 Valid values: T.I.N. assigned by BIR or unique T.I.N. assigned by the bank (refer to Circular Letter dated April 21, 2003 3 TYPROP N 2 0 Type OF Property 21 = Real Estate 22 = Chattels 23 = Others 4 TYPE1 N 1 0 Sub-category of For Real Estate: property 1 = Land Only 2 = Building/Improvement 3 = Land with Improvement For Chattel: 4 = Shares of Stocks 5 = Commercial Papers 6 = Motor Vehicles 7 = Machinery & Equipment 8 = Inventories 0 = For Others For Property type = REAL ESTATE 5 TYPE2 N 1 0 Sub-Property Type 1 = Residential - Socialized 2 = Residential - Others 3 = Commercial 4 = Industrial 5 = Agricultural 6 TCTNUM C 20 TCT Number Dash ( - ) in TCT Num should not be included 7 CCTNUM C 20 CCT Number Dash ( - ) in CCT Num should not be included 8 TAXDN C 20 Tax Declaration Dash ( - ) in Tax Declaration Num should not be Number included 9 OWNER C 100 Registered Owner 10 LOCATION C 100 Location of Property 11 AREA C 20 Area of Property Indicate unit of measure For Property type = CHATTELS (Shares of Stocks / Commercial Papers) 12 ISSUER C 45 Name of Issuer 13 SHARES N 10 0 Number of Shares 14 CERTNUM C 20 Certificate Number Dash ( - ) in Certificate Num should not be included 15 FACEVAL N 15 2 Face Value For Commercial Papers 16 MATDATE N 8 0 Maturity Date For Commercial Papers (CCYYMMDD) For Property type = CHATTELS 17 CRNUM C 20 Vehicle Dash ( - ) in Registration Num should not Registration No. be included 18 MOTORN C 20 Motor No. Dash ( - ) in Motor Num should not be included 19 CHASSIS C 20 Chassis No. Dash ( - ) in Chassis Num should not be included 20 PLATEN C 20 Plate No. 21 TYPEVE C 20 Type of Vehicle For Property type = CHATTELS (Machinery & Equipment/Inventories) Property type = OTHERS 22 DESC C 150 Description Include number of units and indicate unit of measure Important : If a particular field is not applicable to the account, leave as blank for character-type fields and put zero for numeric-type fields.