Assumption by the Central Bank of the liability for treasury certificates.
Section 135
SEC. 135. Assumption by the Central Bank of the liability for treasury certificates.— On the date of which the Central Bank commences business, it shall assume the liability of the Treasury Certificate Fund for all outstanding treasury certificates. The amount of the liability shall be determined by the Secretary of Finance and certified by the Auditor-General. In consideration, for assuming this Inability the Treasurer of the Philippines shall transfer to the Bank all of the available assets of the Treasury Certificate Fund and that portion of the assets of the Exchange Standard Fund which may remain after deducting the amounts required to provide the capital of the Bank and the contribution to the Securities Stabilization Fund, as provided in the preceding section. If the total assets thus transferred exceed the liability assumed, the difference shall be used to establish a reserve on the books of the Central Bank against the: contingency that the actual amount of treasury certificates which the Central Bank may be called upon to exchange for its own notes may prove to be larger than the liability originally assumed. If the total assets transferred should be less than liability assumed, the Secretary of Finance shall deliver to the Bank a non-interest bearing, non-negotiable note without fixed maturity in the amount of the difference. The Central Bank shall, as soon as practicable, exchange outstanding treasury certificates for its own notes in accordance with the procedure described in section 59 of this Act. During the period of such exchange any treasury certificates exchanged, by the Bank in excess of the liability originally assumed for such certificates shall be charged, first, to the reserve mentioned in the preceding paragraph, if there be such reserve, and, second, to the deposit of the Government. At the expiration of the exchange period any remaining balance of the liability account for outstanding treasury certificates shall be applied, first, to reduce the face value of the note delivered by the Secretary of Finance in accordance with the preceding paragraph, if such a note has been issued, and, second, to reduce the Account to Secure the Coinage, the creation of which is provided for in the following section. Any remaining balance of the above-mentioned reserve shall be applied solely to reduce the Account to Secure the Coinage.