The Bangko Sentral ng Pilipinas is proposing to institutionalize a framework of regulatory relief for banks and borrowers affected by calamities, streamlining measures that were previously issued on a discretionary, case-by-case basis.
In a draft circular released Monday, the BSP outlined plans to formalize how financial institutions can access relief immediately after disasters—without waiting for a state of calamity declaration.
The move is intended to build a more predictable and responsive system to support recovery efforts, especially in a country frequently battered by typhoons, earthquakes, and other hazards.
“The policy sets forth the guidelines granting regulatory relief measures to banks affected by calamities, providing a uniform and systemic approach to their implementation,” the 18-page document stated.
Under the proposal, relief measures for typhoons would activate upon landfall or, if landfall does not occur, once flooding or landslides begin.
Earthquake and volcanic eruption triggers would be based on reports from Phivolcs or the National Disaster Risk Reduction and Management Council. Man-made events, however, would still require a formal declaration of calamity to initiate relief.
Key features of the proposal include an extension of the relief application window to one year post-disaster, and increased flexibility for banks in extending financial aid to staff.
Lenders would also be allowed up to 90 days—tripled from the current 30—to submit reports on credit accommodations granted to affected employees.
Loans extended to disaster-hit borrowers would be excluded from classifications as past due or nonperforming during the recovery period. A grace period of up to six months could also be granted to borrowers to help them resume payments after suffering direct impacts.
The circular provides specific guidance for agricultural lending, with deferments designed to align with crop cycles. Loan payments for palay and corn, for example, may be deferred for six months; sugar cane for 12 months; cassava for 14 months; and short-term crops for seven months.
To support economic restart in disaster zones, the BSP also proposes a temporary relaxation of know-your-customer (KYC) rules. For three months after a calamity, banks may accept alternative identification from affected households and microentrepreneurs seeking financing.
The central bank’s move draws from its experience responding to past storms, including Tropical Storm Kristine and Super Typhoons Leon, Ofel, and Pepito. Relief under those events was deployed reactively, often after declarations of calamity by local governments.
If finalized, the proposed rules would embed disaster resilience into the country’s financial system, ensuring that both lenders and borrowers can access relief faster and more consistently during times of crisis
