Banks fully support new law to fight COVID-19 pandemic


The banking community has committed to apply provisions in the “Bayanihan to Heal as One" or Republic Act No. 11469 to alleviate the adverse impact of the COVID-19 outbreak on borrowers.

The law granting President Duterte emergency powers has authorized the chief executive to direct all banks and quasi-banks to extend loan payments by giving at least 30 days grace period, and suspending all fees and charges.

The Bankers Association of the Philippines (BAP) said that it is closely working and coordinating with the Bangko Sentral ng Pilipinas (BSP) for a “smooth implementation” of RA No. 11469, signed into law on Tuesday and implementable for three months unless extended by Congress.

“The banking industry is here to support the National Government and do what is necessary to help win the fight against COVID-19,” said the BAP.

The group has renewed its full support to the government to “immediately arrest and contain the spread of the COVID-19 (and we) can assure the public that our member banks are here to continuously provide critical services amid difficulties and challenges.”

“Despite operating on skeletal workforce, we kept some branches open, ATM machines working and the financial markets going. We are committed to delivering these services to ensure the continuity of the flow of goods and services which are even more vital at this time,” said the BAP.

The BAP is also appealing to its customers and the public for patience and understanding given the limited bank personnel in their branches during the enhanced com¬munity quarantine (ECQ).

“The banks are doing exceptional measures to ensure continu¬ity of access to banking services in the most efficient and sustainable manner. Now, more than ever, the public’s cooperation and understanding are needed and crucial in mitigating this health crisis,” said the BAP.

Even before the passage and approval of the emergency powers, a lot of big banks are already grant-ing loan payments moratorium and suspending fees and charges on its fund transfer services.

The BSP has already heightened coordination with all of its supervised financial institutions or BSFIs, industry associations, other regulatory agencies and international organizations in assessing the likely impact of COVID-19 on financial and operational risks to banks.

“The results of latest coordination with BSFIs disclose that a range of measures are being adopted to ensure safety of their bank employees, non-disruption of bank operations and soundness of key bank indicators. Some large banks have announced they will extend the payment for its consumer loan services, including credit card payments and loans to small and medium-sized enterprises,” said the BSP.

Bank initiatives include strict screening process, alternative platforms to conduct meetings/conferences, split operations, a work-from-home arrangement, and conduct of stress testing exercise to ensure bank preparedness in times of crisis, public advisory on the use of digital platforms for banking transactions, among others.

Based on RA No. 11469, President Duterte can direct all banks, quasi-banks, financing companies, lending companies and other financial institutions, public and private, to give a 30-day grace period applicable to all loans such as salary, personal, housing, motor vehicles, and credit card payments.

Interests, penalties, fees and other charges for all loans falling due within the period of the ECQ will be waived as well.

The 30-day period will also be implemented by the Government Service Insurance System, the Social Security System, and Pag-Ibig Fund. These government agencies are directed to implement a “minimum of 30-day grace period for the payment of all loans.”