CENTRAL BANK ACT - Atty.

Ragadio
UNIVERSITY OF SANTO TOMAS – FACULTY OF CIVIL LAW
Jhoven Paul Tolentino
Sec 2
Tarrosa v. Singson [1994]
Under section 2 of RA 7653, BSP is an independent central monetary authority. Thus, the
appointment of the position of Governor of BSP does not require confirmation by the Commission
on Appointments since BSP cannot be considered as an executive department under Sec. 16 Article
VII of the Constitution.

The Court citing Calderon v. Carale, held that Congress cannot by law expand the
confirmation powers of the Commission on Appointments and require confirmation of
appointment of other government officials not expressly mentioned in the first sentence of Section
16 of Article VII of the Constitution.

Sec 3
DBP v. COA [2002]
The power of supervision of the Bangko Sentral embraces the power to audit. The Court
held in this case that the powers and jurisdiction of the Bangko Sentral and the Commission on
Audit, to examine and audit government banks, are concurrent.

Sec 5
UCPB v. Ganzon [2009]
The Court of Appeals has appellate jurisdiction over final judgments, orders, resolutions
or awards of the Bangko Sentral ng Pilipinas (BSP) Monetary Board on administrative complaints
against banks and quasi-banks.

Before an order of conservatorship, receivership or liquidation may be retrained or set aside

by a court, the following requisites must be present:
1. The petition for certiorari must be filed by the stockholders of record representing the majority
of the capital stock;
2. The petition for certiorari must be filed within 10 days from receipt by the board of directors
of the order directing receivership, liquidation or conservatorship; and
3. The action taken by the Monetary Board was in excess of jurisdiction or with such grave abuse
of discretion as to amount to lack or excess of jurisdiction.

Banco Filipino v. Navarro [1987]

Escalation clauses to be valid should specifically provide: (1) that there can be an increase
in interest if increased by law or by the Monetary Board; and (2) in order for such stipulation to be
valid, it must include a provision for reduction of the stipulated interest "in the event that the
applicable maximum rate of interest is reduced by law or by the Monetary Board."

Sec 15
Banco Filipino Savings and Mortgage Bank v. BSP and the Monetary Board [2018]
A closed bank μnder receivership can only sue or be sued through its receiver, the
Philippine Deposit Insurance Corporation.

Sec 25
 CENTRAL BANK ACT - Atty.
Ragadio
UNIVERSITY OF SANTO TOMAS – FACULTY OF CIVIL LAW
Jhoven Paul Tolentino
Borlongan v. Reyes [2005]
It is illogical to hold the respondents(BSP officials) administratively liable for the
preparation of reports that are, in their nature, merely recommendatory and have to be acted upon
by superior officials. The reports were not the final action that creates right and duties and affects
the interest and fortunes of third parties. Courts do not interfere with any administrative measure
prior to its completion or finality, and when they do, what is actionable is not the recommendation
but the decision of the official with the competence under the law to issue it.

The subject reports are only between the Monetary Board and the BSP officials who
prepared and endorsed them and may be rejected, modified or accepted by the Monetary Board.
As far as this case is concerned, the legal obligations of diligence and good faith that BSP officials
owe to the public under Section 16 of the New Central Act start with the official acts of the
Monetary Board which, rightly or wrong, are the cause of loss or injury to third parties, not any
preparatory report or recommendation.

Sec 30
Rural Bank of Lucena v. Arca [1965]

Rural Bank of Buhi v. CA [1988]

Central Bank v. CA [1993]

Rural Bank of San Miguel v. BSP [2007]

Banco Filipino Savings & Mortgage Bank v. Central Bank [1991]

Borlongan v. Reyes [2005]

General Bank and Trust Co. v. Central Bank [2006]

Manalo v. CA [2001]
The legal provision only finds operation in cases where there are claims against an
insolvent bank. In fine, the exclusive jurisdiction of the liquidation court pertains only to the
adjudication of claims against the bank. It does not cover the reverse situation where it is the bank
which files a claim against another person or legal entity.
A bank which had been ordered closed by the monetary board retains its juridical
personality which can sue and be sued through its liquidator. The only limitation being that the
prosecution or defense of the action must be done through the liquidator. Otherwise, no suit for or
against an insolvent entity would prosper. In such situation, banks in liquidation would lose what
justly belongs to them through a mere technicality.

Phil Veterans Bank Employees' Union v. Vega [2001]

BSP v. Valenzuela [2009]

 CENTRAL BANK ACT - Atty.
Ragadio
UNIVERSITY OF SANTO TOMAS – FACULTY OF CIVIL LAW
Jhoven Paul Tolentino
Central Bank v. Dela Cruz [1990]

Sec 37
Busuego v. CA [1999]
Petitioners therefore cannot complain of deprivation of their right to due process, as they
were given ample opportunity by the Monetary Board to air their Submission and defenses as to
the findings of irregularity during the said 16th regular examination. The essence of due process
is to be afforded a reasonable opportunity to be heard and to submit any evidence one may have
in support of his defense. What is offensive to due process is the denial of the opportunity to be
heard. Petitioners having availed of their opportunity to present their position to the Monetary
Board by their letters-explanation, they were not denied due process.