Section 4
SEC. 4. Section Nine of Republic Act No. 85 as amended, is hereby amended to read as follows: "SEC. 9. A private development bank shall be organized in the form of a stock corporation and its paid-up capital stock shall not be less than four million pesos for Class A, two million pesos for Class C: Provided, That at least seventy percent of the capital stock subscribed by the private shareholder by the private sector shall be owned and held by citizens of the Philippines: Provided, Further, That if said subscription of private shareholders to the capital stock of a private development bank cannot be secured or is not available, the Bank of representative of the said private shareholders and with the approval of its Board of Governors shall, within thirty days from date of said approval by the Board of Governors, subscribe to the capital stock of such development banks, which shall be paid in full at the time of subscription out of the trust fund herein-above mentioned, in an amount equal to the fully paid subscribed capital of the private stockholders: Provided, Further, That such shares of stock subscribed by the bank shall be preferred shares entitled to cumulative dividends at a rate of one per cent during the first five years, two percent during the following five years, and three per cent thereafter, shall be preferred against common and other preferred stockholders in the distribution of assets in the event of liquidation, and shall be entitled to voting privileges: Provided, Further, That additional subscriptions shall be entitled to dividend rate to be determined by the bank: Provided, Further, That such preferred shares of the bank may be sold at any time at par to private individuals who are citizens of the Philippines and in the sale thereof the qualified registered stockholders shall have the right of pre-emption within one year from the date of offer in proportion of their respective holdings, but in the absence of such buyers, preference shall be given to residents of the province or city where the development bank is located; Provided, Further, That such preferred shares of stock shall be automatically converted to common shares when sold to private individuals: Provided, Finally, That all members of the Board of Directors of the private development banks shall be citizens of the Philippines:"