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The mysterious BF Retirement Fund, Inc.

(Article published in the Jun 15,2011 issue of Manila Standard Today) 

  When Mr. Perfecto R. Yasay, Jr., who for some strange reason ended his letter to me of May 25 with the claim that he was “U.P. College of Law, 1972”, failed to favor me with the answer to the main question I posed the following week, namely the whereabouts of the Banco Filipino employees’ retirement fund, I took it upon myself to dig for the reply.  My sleuthing was not as good as Lala Rimando’s of Newsbreak but I did unearth some details some might find interesting.

 It was both a surprise and a relief to discover that the employees’ retirement fund of Banco Filipino was not managed by Banco Filipino’s trust department.  A surprise because the default mode among banks with trust licenses was, and still is, to appoint their trust units to handle their employees’ retirement trust fund.  And a relief because, had it been otherwise, the dire straits BF retirement trust funds are presently in would have shaken my confidence in BF’s trust department personnel’s fidelity to the high standards of their noble calling.  The uncontroverted fact, actually unanimously affirmed by my sources, is that the BF employees’ retirement fund was not managed by BF’s trust department. 

 Instead, it was handled by an entity known as “Banco Filipino Retirement Fund, Inc.” a corporation whose Articles and By-laws were approved by the Securities and Exchange Commission on 28 March 2007 under Certificate of Registration CN200704365.  This corporation is shrouded in mystery.


 Banco Filipino Retirement Fund, Inc.’s main purpose, according the second clause of it’s Articles, is “to incorporate the existing retirement plan of Banco Filipino Savings and Mortgage Bank into an employees’ non-contributory retirement entity which include (sic) the following purposes: (1) to provide and maintain a fund derived solely from contributions of Banco Filipino, as well as the income and earnings thereon, for distribution to the members in the form of benefits in case of retirement, resignation, separation or other causes as may be determined by the Board of Trustees; (2) to extend financial assistance to members of the corporation; (3) to invest its funds, if any, in high-grade securities, real estate, or other low-risk non-speculative investments; (4) to purchase, acquire, hold, lease, sell, mortgage, exchange, convey, or otherwise dispose of real as well as personal properties subject to limitations imposed by law or government regulations, [and] (5) to do and perform such acts as are necessary and incident to the purposes for which the corporation is organized and such acts as are legally inherent to the operation of the corporation and consistent with the powers vested in corporations organized under the laws of the Philippines.”

 It’s a non-stock corporation and its funds are supposed to be both (a) “derived solely from the contributions of Banco Filipino as authorized by the board of directors of said bank as well as earnings from, or income credited to such contributions;” and, as a consequence (b) “no part of the said funds or properties of the corporation shall inure or be spent for the personal benefit of the members, officers or trustees, except to the extent permitted by the Corporation’s Articles of Incorporation, its By-laws and applicable laws.”

 One would expect, in the light of such noble birth and intention, to see that corporation all transparent and straightforward.  But, alas, what appears is the contrary.

 An electronic search of the publicly available records at the Securities and Exchange Commission indicates that the first and only General Information Sheet (GIS) ever filed by Banco Filipino Retirement Fund, Inc. was filed on 07 February 2008.  A GIS is required to be filed, under SEC rules, within 30 calendar days from the date of the annual members’ meeting as stated in the by-laws; if the annual meeting is held on a date other than that stated in the by-laws, the GIS must be filed within 30 calendar days from the date of the actual members’ annual members’ meeting.

 Some of the information provided by the Banco Filipino Retirement Fund, Inc in its one and only GIS filed with the Securities and Exchange Commission are, to say the least, enigmatic.  On the space for “Date of Annual Meeting Per By-laws” the response was “None”.  And on the space for “Date of Actual Meeting” was written “will have to be decided yet.” 

 The most charitable interpretation of these two entries seems to be that no meeting was held on the day set by the by-laws for the members meeting and that as of 07 February 2008 the corporation had not yet decided on when it would hold the required members meeting.  But, even then, it has been three years since that GIS was filed and still, at least based on SEC’s electronically available data, no meeting has yet been held.  How then are the members, who are, exclusively, “the officers and employees of Banco Filipino holding regular and permanent appointments on full time basis and who have rendered at least six (6) months of continuous service in the corporation” (Clause Seventh, Articles) know the status of their corporation and their respective interests therein?

 Banco Filipino employees who are members of Banco Filipino Retirement Fund, Inc. indeed have many things they need to know.  For instance, according to the sole GIS filing of Banco Filipino Retirement Fund, Inc., P39,342,600.00 of its funds are invested in “stocks of another corporation.”  Is that the 2.7% ownership of the company in the common shares of its parent company, Banco Filipino?

 And since the company constitutes the bank employees’ retirement fund, why was there no entry on the all-important item “Fund Balance”?  Mr. Yasay, during the May 17 House Committee on Banks and Financial Intermediaries, revealed that “the Retirement Board placed these deposits [the actual cash of the fund] in various banks, and among other banks, the main bank is Banco Filipino.”  With Banco Filipino now  currently closed, how could the employees avail themselves of the financial assistance envisioned in the primary purpose clause of Banco Filipino Retirement Fund, Inc.?

            The plot thickens and these questions, if he is to be true to his school’s patron’s motto, “The King Good’s Servant, but God’s First,” Hon. Sergio Apostol needs to ask when session resumes this coming August.