The central bank laid out strict reporting guidelines for lenders seeking capital relief on government security valuation losses, mapping out the transitional reporting schedule that begins this month.

The Bangko Sentral ng Pilipinas (BSP) issued Memorandum No. M-2026-032 to outline procedures for banks and quasi-banks to exclude net unrealized losses on peso-denominated government bonds from regulatory capital calculations.

The temporary relief measure aims to shield the domestic financial sector from market volatility triggered by the ongoing conflict in the Middle East.

To qualify for the accounting reprieve, financial institutions must satisfy an initial notification requirement. Eligible lenders were required to inform the BSP via email and submit their February 2026 solo capital adequacy ratio (CAR) report by June 30, 2026. This submission, which includes a control proof list of net unrealized gains or losses on bonds classified as fair value through other comprehensive income (FVOCI), will serve as the baseline for the relief program.

Lenders participating in the program must transition to a more frequent, monthly reporting cycle to allow regulators to monitor capital health closely.

The BSP clarified that the heightened disclosure rules apply strictly to the institutions that choose to avail themselves of the temporary relief.

Starting from the April 30, 2026 reference date, participating banks and quasi-banks must submit monthly CAR reports in XML format using the PRIME facility under the BSP Relationship Management System.

To accommodate the initial implementation phase, the central bank established a compressed deadline schedule for reports spanning April through December 2026. Lenders must submit their backlogged reports for April, May, and June 2026 by July 15, 2026. Subsequent monthly disclosures will be due within 10 banking days after the end of each reference month.

The central bank warned that adherence to these technical and data standards is mandatory. Submissions will undergo strict validation processes, and any reporting violations will face administrative sanctions and penalties under the Manual of Regulations for Banks and the Manual of Regulations for Non-Bank Financial Institutions.