AGRI-AGRA MANDATORY ALLOCATION OF FUNDS UNDER P.D. NO. 717

The Monetary Board, in its Resolution No. 771 dated May 12, 2000,
decided to allow compliance on a groupwide basis with the Agri-Agra
mandatory allocation of funds which is in line with Executive Order No.
83 dated 25 December 1998 which provides among others, that the BSP
shall continuously try to implement and improve compliance by the
banking sector with the provisions of P.D. No. 717.

SECTION 1.       Consolidated Compliance . — The
compliance with Agri-Agra mandatory allocation of funds under P.D. No.
717 shall be allowed on a groupwide basis (based on consolidated
financial statements of investor-financial institution or parent bank
and its subsidiaries/affiliates); Provided, That the subsidiary
banks are at least seventy-five percent (75%) owned/controlled by the
parent bank, subject to the following conditions:

a.         The consolidated report shall be submitted by the
bank in the prescribed form and shall be supported by the individual
reports of the bank and its subsidiaries duly signed by each bank’s
authorized signatory. The subsidiaries shall continue with their
respective submission of the subject report to their respective
supervising and examining departments within the prescribed period.

b.         Either the parent bank or the subsidiary bank can
exercise the right to avail itself of/use the excess of its subsidiary
bank/parent bank for its own compliance.

c.         In the event of a deficiency in compliance of any
parent or subsidiary or all of these banks, the members of the board of
directors and its president and the other officers of the parent bank
shall be responsible for the group’s compliance.

SECTION 2.       Effectivity. — This Circular shall take effect immediately.

Adopted: 18 July 2000

(SGD.) RAFAEL B. BUENAVENTURA
Governor