Section 1
SECTION 1. Section 3, Paragraphs (a) and (e), of Presidential Decree No. 694 is hereby amended to read as follows: "SECTION 3. Corporate Powers.—The Philippine National Bank, upon its organization, shall be a body corporate and shall have power: "a. To engage in the business of commercial banking by accepting drafts and issuing letters of credit, discounting and negotiating promissory notes, drafts, bills of exchange, and other evidences of debts, receiving deposits, buying and selling foreign exchange and gold or silver bullion, by acting as financial agent, by financing or personality leasing, and by lending money against personal security or against securities consisting of personal property or first mortgages on improved real estate and the insured improvements thereon; * * * "e. To issue either in the Philippines or externally, for purposes of augmenting its capital and/or fund generation requirements, all types of bonds, promissory notes, debentures, certificates of indebtedness, or other debt instruments whether senior, unsecured or subordinated obligations, including but not limited to capital notes under such terms and conditions as may be determined by the Board of Directors, which may be: "1. Secured by credits against real estate or other assets of the Bank but not in excess of 90% thereof, or without such security and purely on an unsecured or subordinated basis; "2. Long-term, medium-term or short-term; "3. With fixed interest rate or floating interest rate; "4. Denominated either in the lawful legal tender of the Philippines or in such foreign currencies which are eligible for the foreign exchange reserves of the Central Bank of the Philippines; and "5. With such other features and requirements which in its discretion are deemed necessary. "These bonds, debentures, promissory notes, certificates of indebtedness, or other debt instrument shall be unconditionally guaranteed as to principal and interest by the Republic of the Philippines: Provided, however, That the Bank is also authorized to issue these instruments without the guaranty of the Republic of the Philippines; "These bonds, debentures, promissory notes, certificates of indebtedness, or other instruments, shall be exempt, both as to principal and interest, from any and all taxes imposed by the Government or any of its subdivisions."