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Pursuant to Monetary Board Resolution No. 363, dated April 5, 1995, qualified banks may avail themselves of the Exporters Dollar Facility (EDF) established under M.B. Res. No. 1197, dated December 1, 1994, against the eligible dollar-denominated loans of their exporter-borrowers (both direct and indirect), including service exporters who are engaged in rendering technical, professional, and other services, subject to the following terms and conditions:

1. The interest rate shall be based on the prevailing three-month LIBID, to be reviewed and set every three (3) months: Provided, that the bank's spread shall not exceed 1 percent p.a., after applicable taxes on foreign exchange loans.

2. The loan value of the eligible credit instrument offered by the bank as collateral shall be 100 percent of the face amount or outstanding balance of the loan. The amount of the loan that a bank may grant to a qualified exporter-borrower shall depend on the bank's own credit assessment and valuation procedures, but in no case shall it exceed the amount of the Letter of Credit (LC), Purchase Order (PO) or Sales Contract (SC) or Service Contract.

3. The maturity period for export packing credits shall not exceed 90 days, but shall not extend beyond the expiry date/validity period of the assigned LC/PO/SC. For export bills, the maturity period shall be based on the location of the drawee bank as follows:

a. 10 days for Asia, Australia and the US West Coast;

b. 15 days for the US East Coast;

c. 30 days for Europe; and

d. 40 days for Africa and the Middle East.

Credits to service exporters shall have maturities not to exceed 180 days from date of availment, or not later than the expiry date of the contract, whichever comes first.

The dollar proceeds of the loan shall be released through the Treasury Department, BSP, for credit to the designated correspondent bank of the borrowing bank on the same date the said application is filed with the Department of Loans and Credit, provided that such application is received at or before 12:00 noon and the supporting papers are complete.

The loan shall be repaid in dollars. For this purpose, the borrowing bank shall submit to the Department of Loans and Credit a copy of its remittance instruction to its designated correspondent bank covering an amount sufficient to cover partial or full payment of the maturing loan, plus the corresponding accrued interest.

Availments against dollar-denominated loans shall be charged against the rediscount ceiling of the borrowing bank (100% of net worth) as of the end of the quarter immediately preceding the date of application. In the case of branches of foreign banks, the rediscount ceiling shall be 25% of "Net Due To" plus assigned capital.

The documentary requirements pertaining to peso-denominated loans shall likewise apply to dollar-denominated loans.

This Circular, which supersedes Circular No. 57 dated December 9, 1994, shall take effect immediately.

Adopted: 12 Apr. 1995

(SGD.) GABRIEL C. SINGSON
Governor