The Monetary Board, in its Resolution No. 306 dated February 28, 2002, approved the following amendments to Section X378 of the Manual of Regulations for Banks pursuant to Sections 25, 28 and 31 of Republic Act No. 8791. 

"SECTION X378.       Limits on Investment in the Equities of Financial Allied Undertakings. - The equity investment of a bank in a single financial allied undertaking shall be within the following ratios in relation to its total subscribed capital stock and to the total voting stock of the allied undertaking:

ACTIVITIES		INVESTOR
	UB	KB	TB	RB	COOP
	Publicly	Not	Publicly	Not
	-listed	Listed	-listed	Listed

Allied enterprises

Financial Allied
Undertakings

Universal Banks	100%	49%	100%	49%	49%	49%	49%
Commercial Banks	100%	49%	100%	49%	49%	49%	49%
Thrift Banks	100%	100%	49%	49%	49%
Rural Banks	100%	100%	49%	49%	100%
Coo Banks	NA	NA	NA	NA	30%
Insurance companies	100%	NA	NA	NA	49%
VCCs	60%	60%	60%	49%	49%
Others	100%	49%	40%	40%	40%

To promote competitive conditions, the Monetary Board may further limit the equity investments in quasi-banks of universal and commercial banks to forty percent (40%).

A publicly listed UB or KB may own up to one hundred percent (100%) of the voting stock of only one other UB or KB. Otherwise, it shall be limited to a minority holding.

The existing investment of a bank in another bank under R.A. No. 7721 shall be governed by Sec. X121 insofar as it is consistent with Republic Act No. 8791.

All Circulars previously issued which are inconsistent herewith are hereby superseded.

This Circular shall take effect immediately.

Adopted: 13 March 2002

(SGD.) RAFAEL B. BUENAVENTURA
Governor