Mark-to-Market Valuation of Debt and Equity Securities—Benchmark/Reference Prices

February 28, 2007BSP MEMORANDUM NO. M-2007-006TO:All Banks and Other BSP-Supervised Financial Institutions   SUBJECT:Mark-to-Market Valuation of Debt and Equity Securities—Benchmark/Reference Prices The Monetary Board in its Resolution No. 177 dated 8 February 2007 hereby promulgates the general guidelines on the mark-to-market valuation of debt and equity securities as required under Circular Nos. 476 and 538, dated 16 February 2005 and 04 August 2006, as amended. General PrincipleAs a general rule, to the extent a credible market pricing mechanism as determined by the Bangko Sentral ng Pilipinas (BSP) exists for a given security, that market price shall be the basis of marking-to-market. However, in the absence of a market price, a calculated price shall be used as prescribed in this Memorandum.Marking-to-Market GuidelinesTo ensure consistency, the following shall be used as bases in marking-to-market debt and equity securities: Type of Security Market Price BasisA. Equity Securities Listed in the Stock Exchange1.Traded in the PhilippinesSame day closing price as quoted at the  Philippine Stock Exchange. In case of halt  trading/suspension or holidays, use the last  available closing price.   2.Traded...