SCCP's Dry Run of the Delivery versus Payment (DVP) Procedure To Begin With Trades of 1 December 1998 That Shall Settle by T+4 on December 7, 1998

November 26, 1998 PSE MEMO FOR BROKERS NO. 556-98 SUBJECT : SCCP's Dry Run of the Delivery versus Payment (DVP) Procedure To Begin With Trades of 1 December 1998 That Shall Settle by T+4 on December 7, 1998 Please be advised that during the Board meeting of 25 November 1998, it was decided to do a DRY RUN of the SCCP DVP procedure under the following guidelines: LibLex I. No additional fees shall be imposed. II. Current rules on the disposition of failed trades shall still be followed, however SCCP rules and procedures shall be held in abeyance except those enumerated in item (III) below, until members have given their comments thereto. Upon receipt of said comments and finalization of any needed amendments to SCCP's rules and procedures, the BOG shall make an evaluation not later than 6 months from start of the dry run to finally decide on future action. The above decision was arrived at for the following reasons: a. To give the members a better opportunity to properly evaluate the new procedure and its related rules, and for them to submit their comments thereon. b. To substantially comply with the Order of the Securities & Exchange Commission (SEC) of 29 June 1998, reiterated by the SEC in their letter of 24 November 1998. III. For the dry run period i.e., beginning with trades on 1 December 1998 that shall settle on 7 December 1998, members are enjoined to remind their back office to perform the following: 1. Special Settlement Bank Account Brokers must open their Special Settlement Bank Account with either EBC or RCBC 2. T+4 Delivery Deadline: a. Securities for settlement purposes must be delivered by T+4 not later than 11:00 a.m. to PCD for physical securities and 11:58 for book entry transfers. b. Net Due Clearing payments (in cash, manager's check or Bank Transfer Instruction) must be deposited into the Special Settlement Bank Account not later than 11:00 a.m. of T+4. In addition, a System Cash Deposit (DEPOWITH) in FINTRACS using the Special Settlement Bank Account Number must be entered not later than 11:00 a.m. of T+4. 3. DVP Batch Settlement The SCCP DVP Batch Settlement will be from 12:01 p.m. to 1:00 p.m. of T+4. 4. Net Due Broker Payment Net Due Broker cash list shall be available by 1:00 p.m. after the T+4 Settlement and payments to brokers available thereafter. For net due broker with all securities delivered on T+3, i.e., Physical: T+3 4:00 p.m. or BES: T+3 5:00 p.m. encashment is allowed not exceeding their Daily Net Due Broker as early as 9:00 a.m. on Settlement day (T+4) for Brokers Checks issued for settlement payment to their Clients. llcd 5. The following accommodation is available if needed: For net due broker who will still deliver securities on T+4 before 11:00 a.m., encashment of Broker's Checks issued for settlement payment to their clients is allowed as early as 9:00 a.m. on T+4, not exceeding their individual Daily Net Due Broker Amounts but with a maximum limit of P5 million per Broker. (SGD.) JOSE LUIS U. YULO, JR. President & CEO