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108 OG No. 3, 310 (January 16, 2012)
[ MEMORANDUM NO. M-2011-030, June 03, 2011 ]
OFFICE OF THE DEPUTY GOVERNOR
SUPERVISION AND
EXAMINATION SECTOR
IMPOSITION OF SERVICE CHARGES AND MAINTENANCE FEES ON DEPOSIT ACCOUNTS FALLING BELOW THE MINIMUM AVERAGE DAILY BALANCE (ADB)
FOR : | ALL BANKS |
SUBJECT: | IMPOSITION OF SERVICE CHARGES AND MAINTENANCE FEES ON DEPOSIT ACCOUNTS FALLING BELOW THE MINIMUM AVERAGE DAILY BALANCE (ADB) |
In view of information obtained regarding the erroneous interpretation and application by some banks of the provisions of Section X263 of the Manual of Regulations for Banks (MORB) on Service and Maintenance Fees, all banks are hereby reminded that:
- Service and maintenance fees are collectible only against savings and demand deposits accounts, whether active or dormant, if balances fall below the required minimum ADB. The imposition of service and maintenance fees on savings and demand deposit accounts that meet the required monthly ADB is considered a violation of the provisions of Section X263 of the MORB;
- Conditions (a) to (d) of Section X263 refer to service charges or maintenance fees savings and demand deposits accounts, whether active or dormant, that fall below the required minimum ADB; and
- Condition (e) exclusively pertains to the period and disclosure/notice requirement for imposition of charges and fees for dormant accounts or dormancy fee.
Banks are likewise enjoined to adhere to the due notice requirement under Section X263.1 of the MORB in case of amendments to terms and conditions for the imposition of service charges or fees.
Section 37 of Republic Act No. 7653, otherwise known as the New Central Bank Act, provides for administrative sanctions for, among others, any willful failure or refusal to comply with, or violation of, any banking law or any order, instruction, or regulation issued by the Monetary Board, or any order, instruction or ruling by the Governor. The imposition of these sanctions shall be without prejudice to the criminal sanctions against the culpable persons provided in Sections 34, 35 and 36 of the same Act.
For your guidance and strict implementation.
(Sgd.) NESTOR A. ESPENILLA, JR.
Deputy Governor
Deputy Governor
03 June 2011
[1] 23 June 2005