CBP Memorandum

May 17, 1984 CBP MEMORANDUM TO : All Airline and Shipping Companies Commercial Banks Airline and shipping companies may, at their option: A. apply for forward exchange cover from the Central Bank, or B. purchase Central Bank US Dollar Certificates of Indebtedness for net peso receipts eligible for remittance in accordance with Operating Guidelines No. 6 dated December 12, 1983, Circular No. 970 under the following terms and conditions: aisadc A. Forward Exchange Cover 1. The obligations are eligible for remittance under Operating Guidelines No. 6 of Circular No. 970, as verified and endorsed by the Foreign Exchange Department I. 2. The agent bank upon being notified of the remittability of the amount shall file with FED II the proforma forward exchange cover contract which includes an authority for Central Bank to debit the bank's peso account with the Central Bank for the amount of pesos to be remitted. 3. The peso payment shall be non-interest bearing. The foreign exchange to be delivered on maturity of the contract shall be the equivalent of the peso payment computed at the guiding rate of exchange on the date the agent bank's account is debited by the Central Bank. 4. The forward exchange cover shall have a maturity of 360 days counted from the date the peso payment is debited by the Central Bank from the agent bank's account. 5. The Central Bank retains the option to deliver the foreign exchange prior to the maturity date of the contract or to roll-over the contract on maturity date for another 360 days. 5.a In case the Central Bank opts to deliver the foreign exchange prior to the maturity date or roll-over of the contract, the Central Bank shall inform the agent bank of such arrangement, and the agent shall accordingly submit a written advice to the Central Bank on the manner of disposition of the foreign exchange. 5.b In case settlement is on maturity date, the agent bank shall submit to the Central Bank at least two (2) working days prior to the maturity date, a written advice on the manner of disposition of the foreign exchange. B. Central Bank US Dollar Certificates of Indebtedness 1. The obligations are eligible for remittance under Operating Guidelines No. 6 of Circular No. 970, as verified and endorsed by the Foreign Exchange Department I. 2. The agent bank, upon being notified of the remittability of the amount, shall file with FED I a written request for Central Bank US Dollar Certificates of Indebtedness and authorize Central Bank to debit the bank's account with Central Bank for the amount of pesos to be remitted. 3. The US dollar value shall be determined on the basis of the peso exchange guiding rate on the date the bank's peso account is debited. 4. The Central Bank US Dollar Certificates of Indebtedness shall have a maturity of three (3) years; interest shall be at six-month LIBOR, determined on the date of issue, adjustable every six months thereafter, payable in arrears semestrally by telegraphic transfer. 5. The certificate shall be physically delivered to the agent bank. There shall be no pre-termination of the instrument. Negotiation shall be with prior registration with the Central Bank. On maturity the certificate shall be presented to the Central Bank's Securities Servicing Department for redemption. LLpr These Guidelines shall take effect immediately. (SGD.) GABRIEL C. SINGSON Senior Deputy Governor