HB09543: AN ACT PROVIDING FOR A NEW RURAL BANKS ACT, REPEALING FOR THE PURPOSE REPUBLIC ACT NO. 7353, OTHERWISE KNOWN AS THE RURAL BANKS ACT OF 1992, AS AMENDED
This bill, titled the "New Rural Banks Act," aims to strengthen rural banks in the Philippines by repealing and replacing the existing Rural Banks Act of 1992. It declares a policy to promote comprehensive local community development and financial inclusivity by assisting rural banks as strategic agents in making financial services accessible to all individuals and businesses, particularly in rural areas. The Act outlines the organization and ownership structure of rural banks, allowing non-Filipino citizens to own up to 60% of voting stocks and participate in the board of directors proportionally.
Key provisions include empowering the Monetary Board to regulate rural banks, allowing government-owned or -controlled financial institutions like LBP and DBP to subscribe to rural bank capital stock under specific conditions, and expanding the permissible activities of rural banks to include various banking services and investments in allied undertakings. The bill also grants significant tax exemptions to rural banks and their transactions, particularly for smaller loan amounts, and exempts them from the single borrower's limit on deposits with government financial institutions, fostering their role as conduits for government programs.