Announcement on Savings and Loan Associations

April 11, 1962 CBP MEMORANDUM CIRCULAR TO ALL RURAL BANKS NO. 10-62 For your information and reference, we are reproducing hereunder an announcement published by the Central Bank of the Philippines in the metropolitan dailies, regarding savings and loan associations: LLphil ANNOUNCEMENT To correct any wrong impression which recent newspaper reports on "savings and loan associations" may have created in the minds of the public and other interested parties, as well as to answer numerous inquiries from the public, the Central Bank of the Philippines wishes to announce that all "savings and loan associations" now in operation and other organizations using different corporate names, but engaged in operations similar in nature to said "associations' HAVE NEVER BEEN AUTHORIZED BY THE MONETARY BOARD OF THE CENTRAL BANK OF THE PHILIPPINES TO ACCEPT DEPOSIT OF FUNDS FROM THE PUBLIC NOR TO ENGAGE IN THE BANKING BUSINESS NOR TO PERFORM ANY BANKING ACTIVITY OR FUNCTION IN THE PHILIPPINES. Such institutions violate Section 2 of the General Banking Act, Republic Act No. 337, should they engage in the "lending of funds obtained from the public through the receipts of deposits or the sale of bonds, securities or obligations of any kind" without authority from the Monetary Board. Their activities and operations are not supervised by the Superintendent of Banks and persons dealing with such institutions do so at their risk. CENTRAL BANK OF THE PHILIPPINES (SGD.) CEFERINO E. EUGENIO Director