GUIDELINES ON THE COMPLETION OF THE REPORT ON CROSS-BORDER FINANCIAL POSITIONS1
(Appendix to Sec. 173 on Report on cross-border financial positions)
Classification
1. Geographic Region/Country Classification – Report financial claims and liabilities according to geographic region/country of residence of the counterparty. Financial claims and liabilities which cannot be classified according to country shall be reported in the “Others” section of the geographic region.
2. Sectoral Classification – Report financial claims and financial liabilities according to sectoral classification of the non-resident counterparty which can either be a bank, an NBFI or from a non-financial sector, as follows:
a. Banks – This refers to all banks as defined under existing laws and regulations in the countries in which the said entities are located. It also includes financial exposures to/from the following institutions:
i. Central Bank/Official Monetary Authority – This refers to the national financial institution that exercises control over key aspects of the financial system and carries out such activities as issuing currency, managing international reserves, and providing credit to other depository corporations.
ii. Related Entities – This refers to the reporting bank’s related entities that are situated abroad, namely:
a. Branches, agencies and offices, including head office, in the case of foreign banks/branches;
b. Controlling parent institution of the reporting bank regardless of its sectoral classification; and
c. Subsidiaries that are directly or indirectly majority-owned by the domestic bank and/or head office, in the case of foreign banks.
iii. Foreign Offices – This refers to foreign branches/offices of domestic banks.
Amounts reported in the “Total” columns refer to positions vis-à-vis banks and the aforementioned entities.
b. Non-Bank Financial Institutions – This refers to public sector entities or private corporations that are engaged in financial intermediation or in auxiliary financial activities that are closely related to financial intermediation, but are not classified as banks. It also includes export credit agencies.
c. Non-Financial Sector – This refers to the central government, public sector entities that are non-financial in nature, non- financial private corporations, and individuals.
3. Currency Classification – Report financial claims and liabilities to non- residents according to the currency in which they are denominated following the minimum recommended currency breakdown of the BIS for international locational banking statistics, namely, US dollar, Pound sterling, Swiss franc, Euro, Japanese yen and the Philippine peso. These positions shall be reported in US dollars at the exchange rate prevailing as of reporting date using the Philippine Dealing System (PDS) Peso/US Dollar closing rate and the New York US Dollar/Third Currencies closing rate.
Relevant Financial Accounts
4. Report financial claims and liabilities in accordance with prudential reporting standards, gross of their related allowance for credit losses, if applicable. All amounts must be in absolute figures, including two decimal places.
5. The following financial claims and liabilities, as defined in the Financial Reporting Package (FRP) shall be reported in the data template:
a. Financial Assets
i. Foreign Currency Cash on Hand (FCOH) – Report FCOH as claims against the country of the issuing central bank/ official monetary authority. Banks’ holdings of Euro notes and coins shall be reported as claims on the European Central Bank, which shall be reported under Germany for the country classification.
ii. Checks and Other Cash Items (COCI) – Report COCI according to the geographic region/country of the drawee institution.
iii. Due from Other Banks – Report the amount of Due From Other Banks according to counterparty bank.
iv. Debt and Equity Securities – Report debt and equity securities according to the issuer of the security.
1. Debt and Equity Securities Held for Trading (HFT) – Report the fair value of securities HFT.
2. Financial Assets Designated at Fair Value through Profit or Loss (FA DFVPL) – Report the fair value of FA DFVPL.
3. Available-for-Sale (AFS) Financial Assets – Report the carrying amount of debt and equity securities classified as AFS financial assets, gross of allowance for credit losses.
4. Held-to-Maturity (HTM) Financial Assets – Report the amortized cost of debt securities classified as HTM financial assets.
5. Unquoted Debt Securities Classified as Loans (UDSCL) – Report the amortized cost of debt securities classified as UDSCL.
6. Investments in Non-Marketable Equity Securities (INMES) – Report the cost of INMES.
v. Derivatives with Positive Fair Value Held for Trading – Report the positive fair value of derivatives according to counterparty. Foreign exchange (FX) derivatives shall be reported in the currency in which the derivatives are to be redeemed or settled.
vi. Liability for Short Position – Report the obligation of the bank to return securities purchased/borrowed from the seller/lender under Reverse Repurchase Agreements/ Certificates of Assignment/Participation with Recourse/Securities Lending and Borrowing Agreements, which the former sold to third parties as a reduction in debt and equity securities classified according to seller/lender of security.
vii. Loan Portfolio – Report amortized cost of loans according to borrower:
1. Interbank Loans Receivable
2. Loans and Receivables-Others
3. Loans and Receivables Arising from Repurchase Agreements, Certificates of Assignment/ Participation with Recourse and Securities Lending and Borrowing Transactions
viii. Derivatives with Positive Fair Value Held for Hedging – Report the positive fair value of derivatives according to counterparty. FX derivatives shall be reported in the currency in which the derivatives are to be redeemed or settled.
ix. Sales Contract Receivable (SCR) – Report the amortized cost of SCR arising from the sale of assets acquired in settlement of loans through foreclosure or dation in payment on installment according to buyer of the property.
x. Accrued Interest Income from Financial Assets – Report the amount of accrued interest income from financial assets according to the counterparty of the related underlying financial asset.
xi. Equity Investment in Subsidiaries, Associates and Joint Ventures – Report the adjusted cost of equity investments according to the issuer of the security.
xii. Other Financial Assets – Report the amount of financial claims against non- residents, covering the following accounts, as applicable:
1. Servicing Assets
2. Accounts Receivable
3. Dividends Receivable
4. Deficiency Judgment Receivable
5. Sinking Fund
6. Shortages
7. Foreign Currency Notes and Coins on Hand not Acceptable as International Reserves – Report this account according to the geographic region/country of the issuing central bank/official monetary authority.
8. Foreign Currency Checks and Other Cash Items not Acceptable as International Reserves – Report this account according to the geographic region/country of the drawee institution.
9. Miscellaneous Checks and Other Cash Items
10. Petty Cash Fund – Report this account according to the geographic region/ country of the branch/agency abroad where petty cash is situated.
11. Deposits with Closed Banks/Banks in Liquidation
12. Miscellaneous Financial Assets
xiii. Inter-office Float Items (with Foreign Offices for Domestic Banks) – Report the debit balance difference between the Due to Head Office/Branches/Agencies and Due from Head Office/Branches/Agencies accounts of branches and agencies located abroad of domestic banks. Amounts shall be reported according to the geographic region/country of the branch/agency abroad as “Foreign Offices” under the “Bank” sector.
xiv. Due From Head Office/Branches/Agencies Abroad (Philippine branch of a foreign bank) – Report the amount of Due From Head Office/Branches/Agencies Abroad between foreign bank branches and their head office, branches, agencies abroad. Amounts shall be reported according to the geographic region/country of the branch/agency abroad as “Related Entities” under the “Bank” sector.
b. Financial Liabilities
i. Derivatives with Negative Fair Value Held for Trading – Report the negative fair value of derivatives according to counterparty. FX derivatives shall be reported in the currency in which the derivatives are to be redeemed or settled.
ii. Financial Liabilities Designated at Fair Value through Profit of Loss (DFVPL) – Report the fair value of financial liabilities DFVPL according to lender.
iii. Deposit Liabilities – Report the amortized cost of deposit liabilities according to depositor.
iv. Due to Other Banks – Report the amount of Due to Other Banks according to counterparty bank.
v. Bills Payable – Report the amortized cost of bills payable according to lender, broken down into the following accounts:
a. Interbank loans payable
b. Repurchase agreement
c. Securities lending/borrowing agreements
d. Other bills payable
vi. Bonds Payable – Report the amortized cost of bonds payable according to holder. Bonds payable with maturity of up to twelve (12) months and those with maturity exceeding twelve (12) months shall be separately reported.
vii. Unsecured Subordinated Debt (UnSD) – Report the amortized cost of UnSD according to holder. UnSD with maturity of up to 12 months and those with maturity exceeding twelve (12) months shall be separately reported.
viii. Redeemable Preferred Shares – Report the amortized cost of redeemable preferred shares according to holder. Redeemable preferred shares with maturity of up to twelve (12) months and those with maturity exceeding twelve (12) months shall be separately reported.
Derivatives with Negative Fair Value Held for Hedging – Report the negative fair value of derivatives according to counterparty. FX derivatives shall be reported in the currency in which the derivatives are to be redeemed or settled.
ix. Accrued Interest Expense on Financial Liabilities – Report the amount of accrued interest expense on financial liabilities according to the counterparty of the related financial liability.
x. Finance Lease Payment Payable – Report the amount of future lease payments payable under finance leases according to lessee.
xi. Treasurer/Cashier/Manager’s Checks – Report the amount of treasurer/ cashier/manager’s checks payable according to designated beneficiaries.
xii. Payment Orders Payable – Report the amount of payment orders payable according to designated beneficiaries.
xiii. Margin Deposits on Letters of Credit (LC) and Customers’ Liability on Bills/Drafts under LCs and/or Trust Receipt – Report the amount of non-interest bearing deposits or margin deposits on commercial letters of credit arising from movement of goods or services according to depositor.
xiv. Cash Letters of Credit – Report the amount of import letters of credit issued where the importer pays 100 percent in Philippine pesos.
xv. Outstanding Acceptances Executed by or for Account of this Bank – Report the amount of liabilities according to correspondent bank arising from customer trade, which calls for time drafts payable within a specified number of days from the date of presentation of the beneficiary, for which the bank has given accommodations in the form of acceptance credit.
xvi. Unearned Income – Report the unearned portion of income received according to recipient. This includes rentals received in advance.
xvii. Other Financial Liabilities – Report the amount of financial liabilities to non- residents, covering the following accounts, as applicable:
1. Other Taxes and Licenses Payable– Report the amount of taxes and licenses payable to non-residents.
2. Servicing Liabilities
3. Dividends Payable
4. Accounts Payable
5. Deposit for Stock Subscription – Report according to the geographic region/country of the stockholder/subscriber
6. Miscellaneous Liabilities
xviii. Inter-Office Float Items (with Foreign Offices for Domestic Banks) – Report the credit balance difference between the Due to Head Office/Branches/Agencies and Due from Head Office/Branches/Agencies accounts of branches and agencies located abroad. Amounts shall be reported according to the geographic region/country of the branch/agency abroad as “Foreign Offices” under the “Bank” sector.
xix. Due To Head Office/Branches/ Agencies Abroad (Philippine branch of a foreign bank) – Report the amount of Due To Head Office/Branches/Agencies Abroad between foreign bank branches and their head office, branches, agencies abroad. Amounts shall be reported according to the geographic region/country of the branch/agency abroad as “Related Entities” under the “Bank” sector.
c. Equity Issuance – Report the amount received as equity or paid-in capital from non-resident stockholders:
i. Paid-In Capital Stock
ii. Additional Paid-In Capital
iii. Other Equity Instruments
1. Hybrid Tier 1
2. Equity Component of Compound Financial Instruments
iv. Deposit for Stock Subscription
v. Assigned Capital – Report the amount of capital permanently assigned by a foreign bank to its branches operating in the Philippines pursuant to Section 4 of R.A. No. 7721. This amount shall be reported according to the geographic region/country classification of the head office of the foreign bank branch as “Related Entities” under the “Bank” sector.
d. In the case of foreign bank subsidiaries, report amounts under the following accounts as a financial liability (if a positive amount), or a financial claim (if a negative amount), according to the geographic region/country classification of the controlling parent institution of the foreign bank subsidiary as “Related Entities” under the “Bank” sector:
i. Undivided Profits
ii. Retained Earnings (Retained Earnings – Reserve and Retained Earnings -Free account)
(Circular No. 890 dated 02 November 2015, and 850 dated 08 September 2014)
Footnotes
- Based on Bank for International Settlements (BIS) (2013). Guidelines for reporting the BIS international locational banking statistics.
- Consistent with the definition of the BIS in its international banking statistics, cross-border claims consist of loans and deposits to banks and non-banks, holding of securities and other claims.
- Consistent with the definition of the BIS, cross-border liabilities consists of loans and deposits from banks and non-banks, own issues of debt securities, and other liabilities.
- As defined by the BIS, offshore centers refer to “countries with banking sectors dealing primarily with non- residents and/or in foreign currency on a scale out of proportion to the size of the host economy.”
- http://www.bis.org/statistics/Bankstatsguide.pdf