AMENDING REPUBLIC ACT NO. 1405

• Number: Presidential Decree No. 1792
• Sections: 5

Preamble

WHEREAS, under existing legal framework, the Central Bank

has the authority to examine all records of banks in the discharge of its

responsibilities under the Central Bank Charter;

WHEREAS, the prohibition against inquiry into bank deposits

adversely delimits the examining authority of the Central Bank;

WHEREAS, limited examination powers operate against

effective supervision of banks and endangers the safety of deposits which may

affect the public's faith in the banking system.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the

Philippines, by virtue of the powers in me vested by the Constitution, do hereby

decree and make the following part of the law of the land:

Section 1

SECTION 1. Section 2 of Republic Act No. 1405 is hereby

amended to read as follows:

"SEC. 2. All deposits of whatever nature with banks or

banking institutions in the Philippines including investments in bonds issued by

the Government of the Philippines, its political subdivisions and its

instrumentalities, are hereby considered as of an absolutely confidential nature

and may not be examined, inquired or looked into by any person, government

official, bureau or office, except when the examination is made in the course of

a special or general examination of a bank and is specifically authorized by the

Monetary Board alter being satisfied that there is reasonable ground to believe

that a bank fraud or serious irregularity has been or is being committed and

that it is necessary to look into the deposit to establish such traud or

irregularity, or when the examination is made by an independent auditor hired by

the bank to conduct its regular audit provided that the examination is

for audit purposes only and the results thereof shall be for the exclusive use

of the bank, or upon written permission of the depositor, or in cases of

impeachment, or upon order of a competent court in cases of bribery or

dereliction of duty of public officials, or in cases where the money deposited

or invested is the subject matter of the litigation."

Section 2

SEC. 2. Section 3 of the same Act is hereby amended to read

as follows:

Section 3

SEC. 3. It shall be unlawful for any official or employee of

a bank to disclose to any person other than those mentioned in Section Two

hereof, or for an independent auditor hired by a bank to conduct its regular

audit to disclose to any person other than a bank director, official or employee

authorized by the bank, any information concerning said deposits.

Section 4

SEC. 4. This Decree shall take effect immediately.

Done in the City of Manila, this 16th day of January, in the year of Our

Lord, nineteen hundred and eighty-one.

(Sgd.) FERDINAND E. MARCOS

President of the

Philippines

By the President:

(Sgd.) JUAN C. TUVERA

Presidential Executive

Assistant

Vol. 25, Vital Documents, Presidential Decree 1980-1981