The Bangko Sentral ng Pilipinas (BSP) wants to impose higher monetary penalties on both banks and non-banks’ non-compliance with the reporting standards set by the BSP on prudential and regulatory reports.

In a draft circular, the BSP said the applicable monetary penalties to all BSP supervised financial institutions (BSFIs) with reporting violations will be P5,000 daily penalty for BSFIs with assets of more than P400 billion; P4,000 for BSFIs with assets of above P50 billion but not exceeding P400 billion; and P3,000 for above P10 billion assets but not more than P50 billion.

Lower penalties of P2,000 will be slapped on BSFIs with above P1 billion assets but not exceeding P10 billion; and P1,000 for BSFIs with assets of up to P1 billion.

Reports submitted to the BSP must be complete, accurate, timely and adaptable to be considered compliant with the BSP reporting standards.

When implementing reporting standards, the BSP said a prudential or regulatory report should be: complete which means all relevant data and information are captured and available in the report, including supplemental schedules, attachments, and certifications, as applicable; accurate such as having accurate and reliable data and information that are free from validation errors or misstatements; timely received by the BSP on or before the prescribed submission deadline; and adaptable and submitted in the form and manner prescribed by the BSP to changes or developments to the data collection process.

The BSP said that in addition to the monetary penalties, there will also be non-monetary sanctions on the BSFI, its directors, officers, and personnel as provided under existing laws and regulations may be imposed.

The draft circular noted sanctions for non-compliance of reporting standards such as: a prudential/regulatory report that does not meet the reporting standards set out by the BSP will be subject to a penalty imposed for each calendar day that a violation is incurred, until such time that the report has been determined compliant with the standards; and a prudential/regulatory report that is submitted before the deadline but is found not compliant with the reporting standards will be allowed a one-time resubmission on or before the deadline before the daily penalty at the prescribed rate shall be imposed.

Other sanction guidelines in the proposed circular said that for reports already determined compliant with the reporting standards but were subsequently found to have validation errors and/or misstatements either as a result of supervisory examination or through data analytics processes, and necessitates a resubmission, the submission deadline will apply.

The BSP said that the revised report, submitted on or before the deadline specified, but found to contain an error or misstatement “will be subject to a daily penalty at the prescribed rate until the Bangko Sentral receives a corrected report that is compliant with the standards or directives of the (BSP).”

In the circular policy statement, the BSP said it will continue to have “data-driven decisions to effectively deliver its mandate of promoting financial stability.”

“In this respect, the Bangko Sentral expects (BSFIs) to implement a sound reporting governance framework that promotes the integrity, accuracy, and timeliness of prudential reports submitted,” it said.

The reporting governance framework sets out the policies, expectations, as well as systems and resources necessary to generate complete, accurate, timely, and adaptable reports submitted to the BSP and used by BSFI management in defining strategies, managing risks, and making decisions.