May 30, 2008
BSP CIRCULAR NO. 611-08
| SUBJECT | : | Guidelines on Securities Borrowing and Lending (SBL)Transactions in the Philippine Stock Exchange (PSE) Involving Borrowings by Foreign Entities of PSE-Listed Shares from Local Investors/Lenders |
Pursuant to Monetary Board Resolution No. 585 dated 15 May 2008, custodian banks are authorized to issue special Bangko Sentral Registration Documents (BSRDs) to cover the PSE-listed shares of stock borrowed by foreign entities from local investors/lenders, to allow said foreign borrowers to purchase foreign exchange (FX) from the banking system for remittance abroad using the peso sales proceeds of the borrowed shares including the related income from SBL transactions, i.e., rebates or share in the income earned on the reinvestment of the cash collateral, interest and dividends earned on the peso-denominated government securities (GS) and PSE-listed shares used as collaterals, subject to the following conditions:
a. Borrower shall provide collateral/s in line with the requirements of the Securities and Exchange Commission under its Memorandum Circular No. 7 dated 9 June 2006 prescribing the rules on SBL transactions. The value of the collateral/s must be...
