Financial Institutions

BSP and SEC Issue Guidelines to Implement Mandatory Grace Period for all Loans Pursuant to Bayanihan to Recover as One Act

Republic Act No. 11494, otherwise known as the “Bayanihan to Recover as One Act”, prescribes a mandatory one-time 60-day grace period for the payment of all existing, current, and outstanding loans falling due, or any part thereof, on or before December 31, 2020, in order to mitigate the effects of the COVID-19 situation. 

In this regard, both the Bangko Sentral ng Pilipinas (“BSP”) and the Securities and Exchange Commission (“SEC”) released guidelines to implement this measure.  The guidelines are addressed to all BSP-supervised financial institutions, as well as financing companies, lending companies, and microfinance non-governmental organizations under the SEC Corporate Governance and Finance Department’s jurisdiction (collectively, the “financial institutions”). These guidelines provide that the grace period shall apply to each loan, whether the borrower has a single loan or multiple loans with the institution.