AN ACT CREATING THE AGRICULTURAL AND INDUSTRIAL BANK.

• Number: Commonwealth Act No. 459
• Sections: 58

Section 1

SECTION 1. There is created a bank to be known as the Agricutural and Industrial Bank of the Philippines, the short name of which shall be the Agricultural and In­dustrial Bank, which shall have its principal place of bus­iness in the City of Manila and shall exist for a period of fifty years.

Section 2

SEC. 2. The Bank shall begin to operate within one hundred and eighty days from the date of approval of this Act and the President of the Philippines shall fix such date by proclamation upon certification of the Audi­tor-General and General Manager of the Bank that it is ready to begin operations.

CORPORATE POWERS

Section 3

SEC. 3. The said Agricultural and Industrial Bank shall be a body corporate and shall have power:

(a) To grant agricultural loans;

(b) To grant industrial loans;

(c) To grant real estate loans;

(d) To establish and operate bonded warehouses;

(e) To subscribe for, underwrite, purchase or gua­ rantee bonds issued by agricultural or industrial concerns, or bonds secured by real estate used for commercial pur­ poses ;

(f) To carry on the business of a trust corporation and to manage and administer the funds and properties now entrusted to the National Investment Board;

(g) To issue bonds, subject to the requirements pro­ vided in this Act;

(h) To accept savings and time deposits;

(i) To make by-laws; adopt and use a corporate seal; to buy, hold, transfer, sell, let, lease, mortgage, encumber, and otherwise trade in agricultural and urban real pro­perties and industrial bonds as its aims and the transac­tions of its business may reasonably and necessarily re­quire ; to contract any obligation to enter into any agree­ment essential to the proper management of its corporate matters and to carry out its aims and purposes; to exe­cute and foreclose mortgages, pledges, and other contracts; to appoint and dismiss its officers and employees, unless otherwise provided for by this Law and to fix adequate com­pensation for said officers and employees; to sue and be sued, to have the power of succession, and to exercise such powers as may be reasonably necessary to carry on the business for which it has been created.

CAPITAL AND SHARES

Section 4

SEC. 4. The capital stock of the Agricultural and In­dustrial Bank, which shall be exclusively and fully subs­cribed by the Government of the Philippines, shall be one hundred fifty million pesos, Philippine currency, divided into one hundred fifty thousand shares of the value at par (sf one thousand pesos, Philippine currency, each.

Section 5

SEC. 5. The power of voting all the shares of the Agricultural and Industrial Bank held by the Government of the Philippines is vested in the President of the Philip­pines or in such person or persons as he may, from time to time, designate.

Section 6

SEC. 6. Out of the proceeds of the excise tax on oil, there is appropriated the sum of one hundred and fifty million pesos not otherwise appropriated. The subscription by the Government of the Philippines to the capital stock of the Agricultural and Industrial Bank shall be paid as follows: twenty-five million pesos upon subscription, and the remainder, upon call of the Board of Directors and upon certification by the Secretary of Finance, with the approval of the President of the Philippines, that funds are available in the Treasury of the Philippines for that purpose. Calls for payment of subscription shall not ex­ceed the sum of fifteen million pesos in any year.

LOANS

Section 7

SEC. 7. The Agricultural and Industrial Bank is authorized to grant agricultural loans secured by real es­tate mortgages. In no case shall such loans exceed sixty per centum of the appraised value of the securities, which securities shall include the value of all improvements and other assets acquired with the proceeds of such loans. The maturity dates of said agricultural loans and mortgages shall in no case be less than one year from the date there­of nor in excess of thirty years from such date. Said loans may be made payable at one time or in installments.

Section 8

SEC. 8. The Agricultural and Industrial Bank is also authorized to grant loans for the promotion of industry upon the security of a mortgage of, or deed of trust on, the assets of an industrial establishment, and in no case shall such loans exceed sixty per centum of the market value of the securities, which securities shall include all improvements and other assets acquired with the pro­ceeds of such loans. The maturity dates of said industrial loans and mortgages or deeds of trust shall not be less than one year from the date thereof. The mortgages or deeds of trust may be made payable at one time or in install­ments.

Section 9

SEC. 9. Applications for agricultural and industrial loans shall be made in writing and under oath. Said ap­plications shall contain, among other things:

(a) A detailed description of the real estate or as­ sets of the industrial establishment;

(b) An appraisal of the real estate or assets of the industrial establishment at their reasonable market value;

(c) A full statement of the purposes for which the loan is desired.

It shall be unlawful to use the proceeds of the said loans, or any part thereof, for any purpose or purposes ex­cept those set out in said applications. In addition to the corresponding criminal liability, any violaton of this clause shall be suffcient cause for the rescission of the contract and the foreclosure of the mortgage.

TRANSFER OF THE FUNCTIONS OF THE NATIONAL INVESTMENT BOARD

Section 10

SEC. 10. All the powers vested in, and the duties con­ferred upon, the National Investment Board by Common­wealth Act Numbered Seven, as amended, and by other laws, the funds and properties heretofore placed under the administration of said Board by said Acts, and its assets, accounts, contracts, and choses in action, are trans­ferred to the Agricultural and Industrial Bank, which shall exercise said powers and duties in accordance with said Acts, except as hereinafter provided, and shall administer, dispose of, handle, or execute said funds, properties, as­sets, accounts, contracts or agreements, and choses in ac­tion in the manner the Agricultural and Industrial Bank may determine in the interest of the funds concerned, and the Agricultural and Industrial Bank shall assume all the liabilities of the National Investment Board in behalf, or as trustee of said funds.

Section 11

SEC. 11. The National Investment Board shall stand abolished on the date when the Agricultural and Indus­trial Bank shall begin its operations.

TRUST FUNCTIONS

Section 12

SEC. 12. The Agricultural and Industrial Bank shall have power to act as trustee on any mortgage or bond issued by any municipality, body politic, or corporation, and to accept and execute any other municipal or corporate trust not inconsistent with law.

BONDS

Section 13

SEC. 13. The Agricultural and Industrial Bank is authorized to issue real estate bonds of the face value of not less than twenty-five pesos in any sum not to exceed ninety per centum of the amount of real estate loans held by said Bank under section seven of this Act.

Section 14

SEC. 14. The real estate securities against which the real estate bonds are issued as provided herein shall be deposited with the Treasurer of the Philippines, and each of said bonds when issued shall bear on its face a certi­ficate of the Treasurer of the Philippines in words and fi­gures as follows:

"I certify that there are on deposit in the Treasury of the Philippines first mortgage real estate securities in the sum of one hundred eleven and one-ninth per centun covering farm land of an appraised value of one hundred eighty-five and five-twenty-sevenths per centum of the face value of this bond; which said real estate securities, or other first mortgage real estate farm securities equal value, or the proceeds thereof are to be held by me as security, additional to the promise of the Agricultural and Industrial Bank of the Philippines for the prompt payment of this bond, principal and interest.

Treasurer of the Philippines"

Section 15

SEC. 15. Changes in this Act or in other laws of the Philippines which may hereafter be made shall not in any manner affect the real estate bonds issued hereunder which may be outstanding at the time of such change or changes, nor shall any such change or changes affect the rights of any holder or holders thereof.

Section 16

SEC. 16. With the approval of the President of the Philippines, the Agricultural and Industrial Bank is author­ized to issue debenture bonds of the face value of not less than twenty-five pesos in any sum not to exceed the full amount of its capital. Principal and interest of said de­benture bonds may be guaranteed by the Government of the Philippines.

Section 17

SEC. 17. Said real estate and debenture bonds shall be engraved, signed by the General Manager of the Agri­cultural and Industrial Bank, and authenticated by the Auditor-General, and shall bind the Agricultural and In­dustrial Bank to pay to the bearer thereof on the date therein named, unless sooner redeemed in accordance with the provisions of this Act, the principal sum mentioned in said bond, with interest payable semi-annually at such rate as the Agricultural and Industrial Bank may fix. Said bonds shall be payable in Manila except as hereinafter pro­vided, both as to principal and interest, in lawful money of the Philippines.

Section 18

SEC. 18. Bonds issued in accordance with this Act shall be received by the Insurance Commissioner as se­curities of insurance companies under the Insurance Act, and by way of security in all customs and internal-revenue transactions where security is required, and in all other cases, where, by statute, security may be required in deal­ings with the Government.

Section 19

SEC. 19. Said bonds shall be exempt from all taxes levied or assessed by the Government of the Philippines, or any branch or subdivision thereof.

Section 20

SEC. 20. The real estate bonds and debentures shall be issued in such amounts and forms, at such times and for such periods as may be expressly provided by reolution of the Board of Directors of the Agricultural and In­dustrial Bank and approved by the President of the Philip­pines. Said bonds shall be redeemable at par on or before the date of their maturity and shall contain a provision co the effect that they are subject to redemption by lot at such a date as the Agricultural and Industrial Bank may designate. Such of the bonds so chosen by lot for redemp­tion as have not been outstanding for at least three-fourths of the period for which issued shall be retired with a premium of five per centum of the par value there­of. The bonds so chosen for redemption shall cease to bear interest beginning with the date set for their with­drawal, and the aforesaid selection by lot shall take place at least one hundred days before the date of the with­drawal. The serial numbers of the bonds so selected shall be published once a week for a period of not less than three months in two daily newspapers of general circula­tion in the Philippines.

Section 21

SEC. 21. The Board of Directors may, at the request of the holder, authorize the payment of interest on any bond at the branches or agencies of the Agricultural and Industrial Bank in the municipalities of the Philippines or in the United States.

Section 22

SEC. 22. The Agricultural and Industrial Bank is authorized to guarantee both as to principal and interest, or either, bonds issued by duly incorporated companies for agricultural, industrial, or commercial purposes. The guarantee by the Agricultural and Industrial Bank on any bond authorized herein shall be lawful only when approved by the President of the Philippines.

UNDERWRITING

Section 23

SEC. 23. The Agricultural and Industrial Bank is authorized to act as business agents for other banks; to take charge of raising national and local loans secured by bonds, general debentures, and shares; to receive sub­scriptions thereto; to disburse principal and interest or dividends thereof; and also to underwrite bonds of other companies.

SAVINGS AND FIXED DEPOSITS

Section 24

SEC. 24. The Agricultural and Industrial Bank is authorized to receive savings and time deposits. The de­posits received by the Agricultural and Industrial Bank may be loaned or invested only as follows:

(a) Loans secured by mortgage or deed of trust to the Bank of unencumbered improved real estate in cities and municipalities, or by mortgage or deed of trust to the Bank of actually cultivated and improved agricultural lands. The amount loaned shall not exceed sixty per centum of the appraised value of the real estate including the value of the insured improvements thereon which is security for the loan. In determining the amount to be loaned upon a given parcel of real estate careful consideration shall be given to the prices at which surrounding property has been sold, the assessed value of the property offered as security, and the revenue-producing capacity of such property.

(b) Bonds or evidences of debt, or loans secured by such bonds or evidences of debt of the Government of the United States or of the Philippines or of any province, city, or municipality in the Philippines authorized by law to issue bonds; and bonds or evidences of debt, or loans secured by such bonds or evidences of debt, of any per­ son, firm, company, corporation, or other entity guaranteed both as to principal and interest by the Government of the United States. Any loan made upon the security of such bonds or evidences of debt shall not exceed the face value of such bonds or evidences of debt, or the mar­ket value thereof, whichever may be the smaller;

(c) Loans with first mortgages transferred to the Agricultural and Industrial Bank as collateral security on improved' arid otherwise unencumbered real estate in ci­ties and municipalities in the Philippines. The mortgages shall not exceed sixty per centum of the appraised value of the real estate and insured improvements which secure such mortgage;

(d) Collateral trust bonds or notes or obligations se­cured by such bonds or notes secured by a first mortgage or by a participating interest in a first mortgage upon improved urban real estate in cities and municipalities of the Philippines: Provided, That such bonds and notes shall have been outstanding for at least three years prior to their purchase by the Agricultural and Industrial Bank: And provided, That during the period, the earnings of the property mortgaged and available for paying interest have been equal to at least two hundred per centum of the an­nual interest payable on account of all first mortgage obli­gations outstanding. No such bonds or notes or obliga­tions secured thereby shall be purchased if the aggregate of first mortgage obligations outstanding against the pro­perty exceeds sixty per centum of the appraised value thereof.

SPECIAL SECURITY FOR LOANS

Section 25

SEC. 25. Except as specially otherwise provided in this Act, real property without Torrens title may be re­ceived as security, if it is shown to the satisfaction of the Bank that the debtor is the same who has the pos­session of the land as owner, and that this possession, together with those of his predecessors, has been conti­nuous and uninterrupted during the last ten years, that he has cleared, bettered, or improved the land during that time, and that the real estate tax has been paid by him and by his predecessors during the said time.

SECURITIES FOR LOANS NOT SUBJECT TO ATTACHMENT

Section 26

SEC. 26. Securities on loans granted by the Agri­cultural and Industrial Bank shall not be subject to at­tachment nor can they be included in the property of in­solvent persons or institutions, unless al debts and oblig­ations of the debt—or to the Agricultural and Industrial Bank have been previously paid, including accrued inte­rest, collection expenses, and other charges.

LIMITATION OF LIABILITIES TO THE BANK

Section 27

SEC. 27. The total liabilities to the Agricultural and Industrial Bank of any person, company, corporation or firm for money borrowed, shall at no time exceed fifteen per centum of the unimpaired capital and surplus of said Bank, except in the case of the instrumentalities of the Government of the Philippines.

ADDITIONAL SECURITIES—DISPOSAL OF

SAME—ADVANCED MATURITY OF

CREDITS

Section 28

SEC. 28. If, from any cause whatsoever, any of the securities specified for the loans or advances provided for in this Act or accepted by the Agricultural and Industrial Bank as security for loans or advances decline or depreci­ate in market value in part or as a whole, or if said se­curities are insufficient, or if the loans have become or are unsecured, or on non-performance of any promise made to secure the loan, the said Bank may demand additional securities, and if the debtor fails to submit such addi­tional securities, may forthwith declare any such obliga­tion due and payable and upon three days' notice, demand, sell, assign, transfer, and deliver the whole of said secu­rities or any part thereof, or any substitutes therefor, or any addition thereto, or any other securities or property given unto or left in the possession of, or hereafter given unto or left in the possession of, or hereafter given unto or left in the possession of the said Bank, or in any bank or corporation controlled by the Government, or in any of its branches, agencies, and instrumentalities, for safe­keeping or otherwise, at any broker's board or at public or private sale, at the option of said Bank: Provided, however, That if the securities consist of a real estate mortgage, the sale of the said securities shall be made after a judicial foreclosure of the mortgage or following the procedure provided for in Act Numbered Three thou­sand one hundred thirty-five, as amended.

Section 29

SEC. 29. In case of sale for any cause, after de­ducting all costs of expenses of any kind for collection, sale, or delivery, the Agricultural and Industrial Bank may apply the residue of the proceeds of the sale so made, to pay one or more or any of the said liabilities to the said Bank, as its General Manager shall deem proper, whether then due or not. granting proper rebate for interest on liabilities not then due. If the proceeds of the sale do not cover the full amount of the loan, together with the interest and other charges thereon, the Agricultural and Industrial Bank may proceed against the debtor for the dif­ference, but any amount exceeding the full indebtedness to the Bank shall be delivered to the debtor.

EXTRAJUDICIAL FORECLOSURE OF REAL ESTATE MORTGAGE

Section 30

SEC. 30. When the securities given to the Agricultural and Industrial Bank consist of a real estate mort­gage, the sale of said securities may be made in accordance with Act Numbered Three thousand one hundred thirty-five, as amended, without publishing the notice of sale in the newspapers if the assessed value of the property does not exceed one thousand pesos, and publish­ing same in the Official Gazette if it exceeds said sum, and sending in any case the notice of sale to the debtor and the treasurer of the city or municipality where the property is located, by registered mail. If the highest bid­der in the sale is a person other than the creditor, the official conducting the sale may charge a commission on the money which passes through his hands at the rate fixed in such cases for the sheriff.

REDEMPTION OF REAL PROPERTY

Section 31

SEC. 31. The mortgagor or debtor to the Agricul­tural and Industrial Bank, whose real property has been sold at public auction, judicially or extra-judicially, for the full or partial payment of an obligation to said Bank, shall, within one year from the date of the auction sale, have the right to redeem the real property by paying to the Bank all the amount he owed the latter on the date of the sale, with interest on the total indebtedness at the rate agreed upon in the obligation from said date, unless the bidder has taken material possession of the property or unless this has been delivered to him, in which case the proceeds of the property shall compensate the interest. If the Agricultural and Industrial Bank was not the high­est bidder at the auction sale, the Bank shall, in case of redemption, return to the bidder the amount it received from him as a result of the auction sale with the corres­ponding interest paid by the debtor.

HOLDING OF REAL ESTATE

Section 32

SEC. 32. The Agricultural and Industrial Bank is au­thorized to the extent of ten per centum of its paid-up capital to purchase and own such real estate as may be necessary for the purpose of carrying on its business. It is also authorized to hold such real estate as it may find necessary to acquire in the collection of debts due to the said Bank or to its branches and agencies; but real estate acquired in the collection of debts shall be sold by the said Agricultural and Industrial Bank within five years after the date on which ownership of the real estate thus acquired is vested in the Agricultural and Industrial Bank.

DEPOSIT RESERVE

Section 33

SEC. 33. The Agricultural and Industrial Bank shall, at all times, keep on deposit the reserve required by exist­ing laws.

DIVIDENDS AND DISPOSAL OF PROFITS

Section 34

SEC. 34. The Agricultural and Industrial Bank shall not, during the time it shall continue its banking opera­tions, withdraw or permit to be withdrawn, either in the form of dividends or otherwise, any portion of its capital. If losses have been sustained by the Bank equal to or ex­ceeding the undivided profits on hand, no dividend shall be declared; and no dividend shall ever be declared by the Bank in an amount greater than its net profits on hand, deducting therefrom its losses and bad debts. All debts due to the Bank, on which interest is past due and unpaid for a period of six months, unless the same are well se­cured, and in process of collection, shall be considered bad debts within the meaning of this section.

Section 35

SEC. 35. After deducting of the administrative ex­penses, and after making such provisions as the Board of Directors thinks proper for bad and doubtful debts, de­preciation in assets, pension funds, or retiring allowance for the staff and all such other matters as are usually provided for by banks, the net profits or gains resulting from the operations of the Agricultural and Industrial Bank shall be apportioned semi-annually as follows:

(a) For the creation and maintenance of a reserve, a sum equal to fifty per centum of the net profits.

(b) The remaining fifty per centum shall be paid to the Government of the Philippines in the form of divi­dends. The dividends so paid shall not exceed in any calendar year twelve per centum of the paid up capital, and in case there is surplus after the necessary provision has been made for the reserve and dividend above men­tioned, such surplus shall be transferred to the account of undivided profits.

Section 36

SEC. 36. The affairs and business of the Agricul­tural and Industrial Bank shall be directed and its property managed and preserved, unless otherwise provided in this Act, by a Board of Directors consisting of seven members to be appointed by the President of the Philip­pines, with the consent of the Commisison on Appoint­ments of the National Assembly. If they are not offi­cers or employees of the Government receiving a fixed compensation or salary from public funds, they shall be paid a per diem in no case to exceed twenty-five pesos for each session of the said Board of Directors attended by them.

Section 37

SEC. 37. No director or employee of any private bank shall be eligible as member of the Board of Directors of the Agricultural and Industrial Bank.

Section 38

SEC. 38. Within the first twenty days after the approval of this Act, and annually on the first Tuesday after the first Monday of March, beginning with the year nineteen hundred and forty, the President of the Philip­pines shall appoint the members of the Board of Directors. Immediately after their appointment, the Directors shall organize as such and elect from among themselves a Chair­man and a Vice-Chairman. The latter shall assist the Chairman and act in his stead in the case of his absence or incapacity.

DUTIES AND POWERS OF THE BOARD OF DIRECTORS

Section 39

SEC. 39. The Board of Directors shall have the fol­lowing powers and duties.

(a) To fix, from time to time, the rate of interest to be charged by said Agricultural and Industrial Bank and have the same published in the central office;

(b) To fix different rates of interest on loans in ac­cordance with the different classes of securities herein specified;

(c) To establish branches and agencies of the Bank in the provincial capitals and in those municipalities in which, in their judgment, industrial or agricultural needs may require it;

(d) To provide adequate personnel so as to deter­ mine promptly and at the least expense possible to the borrower the validity and sufficiency of the securities of­fered to guaranty the payment of the loans applied for.

Section 40

SEC. 40. The branches and agencies of the Agricul­tural and Industrial Bank shall be authorized to exercise the powers conferred upon them by the Board of Directors and shall submit detailed reports of their operations as may be required by the central office at Manila.

Section 41

SEC. 41. The officers, agents, and employees of said branches and agencies shall be appointed and may be re­moved in accordance with the provisions of sections forty-seven and forty-eight of this Act.

Section 42

SEC. 42. With the authorization of the proper Dep­artment Secretary first had, the Board of Directors may appoint as agents, cashiers, or tellers of said Agricultural and Industrial Bank, the provincial or municipal treasurers, who shall receive such additional compensation as the Agricultural and Industrial Bank may determine, and shall be removable from office, not only as such agents, cashiers, or tellers, but also as such provincial and municipal treasur­ers by the President of the Philippines tor violation of the provisions of this Act or of by the by-laws of the Agricultural and Industrial Bank, or of any instruction received by them from said Bank.

GENERAL MANAGER AND ASSISTANT GENERAL MANAGERS

Section 43

SEC. 43. The orders and resolutions of the Board of Directors shall be carried out by a General Manager, who shall be the chief executive of the Agricultural and In­dustrial Bank, and one or more Assistant General Man­agers, who shall assist the General Manager. Said offi­cers shall be paid salaries to be fixed by the Board of Directors with the approval of the President of the Phil­ippines. In the event of the absence of the General Man­ager or of his incapacity to act, the Board of Directors shall designate the Assistant General Manager who shall take his place. The General Manager and the Assistant General Managers shall be appointed by the Board of Directors, with the approval of the President of the Phil­ippines, and may be removed in like manner.

DUTIES AND POWERS OF THE GENERAL MANAGER

Section 44

SEC. 44. The General Manager of the Bank shall, among others, have the following powers and duties:

(a) To grant long term loans for agricultural or in­dustrial purposes for periods of time not to exceed five years and in sums not exceeding fifty thousand pesos to any one person, company, corporation, or firm, but he is required to submit a report on each loan to the Board of Directors at its next succeeding session;

(b) To make, with the advice and consent of the Board of Directors, all contracts on behalf of the said Agricultural and Industrial Bank and to incur all neces­sary obligations by this Act required or permitted;

(c) To report weekly to the Board of Directors the main facts concerning the operations of the Agricultural and Industrial Bank during the preceding week and to suggest changes in rates of interest or of policy which may to him seem best;

(d) To furnish, upon request of the President of the Philippines, or the Secretary of Finance, any information in his possession regarding the operations of said Agri­cultural and Industrial Bank.

AUDITOR

Section 45

SEC. 45. The Auditor-General shall be ex-officio au­ditor of the Agricultural and Industrial Bank and shall appoint and fix the salary of a representative who shall be the auditor in charge of the auditing office of the Agri­cultural and Industrial Bank. The Auditor-General shall, upon the recommendation of the Auditor of the Agricul­tural and Industrial Bank, appoint and fix the salaries of or remove the personnel of the Auditing Office. The oper­ating expenses of the Auditing Office and the salaries and traveling expenses of the officers and employees thereof shall be payable by the Agricultural and Industrial Bank, and the Board of Directors shall make the necessary ap­propriation therefor. The representative of the Auditor-General shall make a quarterly report on the condition of the Bank to the President of the Philippines, through the Secretary of Finance, to the Speaker of the National As­sembly, to the Auditor-General and to the Board of Direc­tors of said Bank. The report shall contain, among other things, a statement of the resources and liabilities, in­cluding earnings and expenses, the amount of capital stock, dividends paid, surplus, reserve, and undivided profits, as well as the losses, bad debts, and suspended and overdue paper carried in the Bank's assets as of the date on which the statements are compiled.

LEGAL COUNSEL

Section 46

SEC. 46. The Secretary of Justice shall be ex-officio attorney for said Agricultural and Industrial Bank and may, whenever he may deem it proper, in specific cases delegate his duties to the Solicitor-General, the Fiscal of the City of Manila, or any provincial fiscal. The Board of Directors of said Bank, with the approval of the Sec­retary of Justice, shall have the power to employ such additional attorney as may be necessary.

OTHER OFFICERS AND EMPLOYEES

Section 47

SEC. 47. All the other officers and employees of the Agricultural and Industrial Bank shall be appointed and removed by the Board of Directors, on recommendation of the General Manager.

Section 48

SEC. 48. Said officers and employees shall not be subject to the Civil Service Law, and their duties and compensation shall be fixed by the General Manager, with the approval of the Board of Directors.

FIDELITY INSURANCE OF OFFICERS

AND EMPLOYEES

Section 49

SEC. 49. The officers and employees of the Agricul­tural and Industrial Bank, including those of its branches and agencies, whose duties require the custody of funds or property for which they are accountable, shall be bonded and their fidelity insured in accordance with the provisions of the Public Bonding Law.

LIFE INSURANCE OF OFFICERS AND EMPLOYEES

Section 50

SEC. 50. The regular and permanent officers and em­ployees of the Agricultural and Industrial Bank and of its branches and agencies in the Philippines shall be reg­ular members of the Government Insurance System.

EXAMINATION OF THE BANK