THE Monetary Board, the policy-making body of Bangko Sentral ng Pilipinas, wants banks and quasi-banks to be more transparent in their presentation of annual reports so that the public will be informed about their real condition.
In a statement Wednesday, the board said it approved the amended guidelines on the presentation of annual report of banks and quasi-banks. The move is aimed at enhancing market discipline aligned with international best practices.
Under the revised rules, banks and quasi-banks are required to disclose in their annual reports significant information concerning their financial condition, performance, ownership and governance.
Bangko Sentral Deputy Governor Nestor Espenilla Jr. said the information would enable the public and market participants to better understand the true condition of the banks and quasi-banks.
“The initiative is an important step to promote greater disclosure and transparency. This paves the way for the public and market players to access material information before decisions are made,” Espenilla said.
All banks and quasi-banks, except foreign bank branches, are now required to publish their annual reports. This is a departure from previous guidelines which anchored the requirement on the type and asset size of the bank.
The annual report includes discussion and analysis of the bank and QB’s corporate policy, financial highlights, financial condition and results of operation. It also provides information on the bank and QB’s risk management and corporate governance framework.
Banks and quasi-banks with complex business segments would be required to disclose more granular information, the board said.
The approval of the Monetary Board will apply to annual reports for the financial year 2017 effectively giving banks and quasi-banks adequate transition to the new requirement.