Section 20
SEC. 20. Section thirty of the same Act is hereby amended to read as follows: "SEC. 30. The combined capital accounts of each savings and mortgage bank shall not be less than an amount equal to ten per cent (10%) of its risk assets which is defined as its total assets minus the following assets: "(a) Cash on hand; "(b) Amounts due from the Central Bank; "(c) Evidences of indebtedness of the Republic of the Philippines and of the Central Bank, and any other evidences or indebtedness or obligations the servicing and repayment of which are fully guaranteed by the Republic of the Philippines; "(d) Loans to the extent covered by hold-out on, or assignment of, deposits maintained in the lending bank and held in the Philippines; and "(e) Other non-risk items as the Monetary Board, may, from time to time, authorize to be deducted from total assets. "The Monetary Board shall prescribe the manner of determining the total assets of banking institutions for the purposes of this section, but contingent accounts shall not be defined as being included among total assets. "Whenever the capital accounts of a bank are deficient with respect to the requirements of the preceding paragraph, the Monetary Board, after considering a report of the appropriate supervising department on the state of solvency of the institution concerned, shall limit or prohibit the distribution of net profits and shall require that part or all of net profits be used to increase the capital accounts of the institution until the minimum requirement has been met. The Monetary Board may, furthermore after considering the aforesaid report of the appropriate supervising department and if the amount of the deficiency justifies it, restrict or prohibit the making of new investments of any sort by the bank, with the exception of purchases of evidences of indebtedness included under subsection (c) of this section, until the minimum required capital ratio has been restored. "Where, in the process of a bank merger or consolidation, the merged or constituent bank may not be able to comply fully with the net worth to risk assets ratio herein prescribed, the Monetary Board may, at its discretion, temporarily relieve the bank from full compliance with this requirement under such conditions as it may prescribe."