Bill that facilitates banking secrecy gets Palace approval

A central bank-backed bill that would ease one of the most restrictive deposits on secrecy laws in the world has received backing from President Duterte, who has included it on his list of priority legislative measures to be handled by lawmakers.

In a statement, Bangko Sentral ng Pilipinas (BSP) said the bank deposit bill had been approved by the executive director for the forthcoming 18th Congress for immediate action, according to the president’s legislative liaison office. The central bank hopes that the Bank Deposits Secret bill will equip its examiners with the tools necessary to prove fraud, serious irregularity or illegal activity, if a reasonable basis exists.

The agency says this will also allow it to fulfill its mandate and conduct more holistic studies of banks, so risk areas will be considered in assessing their financial condition, risk management and corporate governance systems.

“We are pleased that the President has identified the law on the secrecy of bank deposits as a legislative priority,” said BSP Governor Benjamin Diokno. “In light of this, the BSP will further intensify its efforts to coordinate with Congress and other stakeholders for the immediate implementation of the measure.” A key provision of the proposed law is that the results of BSP’s investigation or study are not arbitrarily shared or disclosed, but are for the use of the regulator only.

Nevertheless, the BSP can only share the results of its investigation with the courts and other supervisory authorities if it is necessary to prevent or prosecute an offense or crime.

“This [bill] improves BSP’s capacity to fulfill its mandate to promote the security and soundness of the banking system, ”said Diokno. “It also enables compliance with international standards of transparency, which will also strengthen the public and the global community’s confidence in the domestic banking system.”

The President’s Office informed the BSP that it had referred the Bank Deposit Secrecy Act to the Legislative-Executive Development Advisory Council for prioritization and inclusion in the Joint Legislative Agenda for the Executive Board and the Legislature.

This was in response to separate notices sent by the BSP requesting that the said bill be included in the list of priority bills and be confirmed as urgent by the President.

In the House of Representatives, BSP is in constant communication with the Committee on Banks and Financial Intermediaries on the interpellation of the bill. Meanwhile, the BSP has contacted the offices of various senators for possible sponsorship and conducted briefings in this regard.

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