BSP to ask Duterte to certify as urgent bill seeking amendments to bank secrecy law

The Bangko Sentral ng Pilipinas (BSP) will ask President Rodrigo Duterte to certify as urgent a bill seeking to amend existing bank secrecy laws and strengthen the central bank's supervisory powers.

At a virtual briefing, BSP Governor Benjamin Diokno said the central bank recommends that Republic Act 1405, or the Secrecy of Bank Deposits Law, be limited within the confines of its banking supervision and investigation of closed banks.

The proposed amendments also include provisions that seek to protect banks against suits from depositors in line with the BSP's inquiry or examination of deposits, and against the use of the law for persecution or harassment.

"We will request the President to certify this as urgent," Diokno told reporters on Wednesday afternoon.

At its current version, the bank secrecy law is regarded as one of the toughest in the world, as it prohibits the disclosure, inquiry, and examination into Philippine currency deposits of whatever nature and kind, as well as investment in securities issued or guaranteed by the government.

To recall, President Rodrigo Duterte in his first State of the Nation Address (SONA) in 2016 vowed to lower personal and corporate income tax rates, and relax the Bank Secrecy Law.

Both taxes have been lowered but the amendments to the Bank Secrecy Law have yet to be passed, making the Philippines currently the only country to have such a law after Lebanon lifted its version in May 2020.

"Clearly it doesn't look good for us, that's why we want to pass this law to be at par with the international standards," said Diokno.

Duterte, then a presidential candidate in 2016, was also dared to sign a bank secrecy waiver, but his accounts were not opened to the public.

At present, the central bank's proposals under House Bill 8991 are on second reading at the plenary.

House Bills 1498 and 3554, which exempt government officials, are being deliberated at the House Committee on Banks and Financial Intermediaries.

Meanwhile, Senate Bills 663, 634, 539, 374, 26, and 1802 are being discussed at the Senate Committee on Banks, Financial Institutions, and Currencies.

"We have been pressing this in both houses of Congress and as you can see, there are a lot of initiatives already at the part of Congress. We expect this to be acted upon may be as early as when they reopen Congress. Sometime in May," said Diokno.

Diokno's predecessor, the late BSP Governor Nestor Espenilla Jr. also previously supported easing bank secrecy laws.

Former BSP Deputy Governor Vicente Aquino said that with the repeal of the law, processing of bank records would be fast-tracked especially in cases of litigation, as current laws state that bank deposits must be treated as confidential and may only be opened with written consent from the account holder. — RSJ, GMA News