The Monetary Board must ensure that at least sixty percent(60%) of the resources or assets of the entire banking system is held by domestic banks which are majority-owned by Filipinos, which might impedes the entry of majority-foreign investors when the limit is reached. For the purposes of the OECD FDIRRI, this restriction is recorded as a restriciton on the greenfiled entry of foreign majority-owned, which is considered less stringer under the OECD FDIRRI methodology (even though acquisitions by foreign investors will also be limited when the limit is reached).
"Section 1. Section 2 of Republic Act No. 7721 is hereby amended to read as follows:
"SEC. 2. Modes of Entry. – The Monetary Board may authorize foreign banks to operate in the Philippine banking system through any one of the following" modes of entry: (i) by acquiring, purchasing or owning up to one hundred percent (100%) of the voting stock of an existing bank; (ii) by investing in up to one hundred percent (100%) of the voting stockof a new banking subsidiary incorporated under the laws of the Philippines; or (iii) by establishing branches with full banking authority.
Section 2. Section 3 of Republic Act No. 7721 is hereby amended to read as follows:
SEC. 3. Guidelines for Approval. – In approving entry applications of foreign banks, the Monetary Board shall: (i) ensure geographic representation and complementation; (ii) consider strategic trade and investment relationships between the Philippines and the country of incorporation of the foreign bank; (iii) study the demonstrated capacity, global reputation for financial innovations and stability in a competitive environment of the applicant; (iv) see to it that reciprocity rights are enjoyed by Philippine banks in the applicant's country; and (v) consider willingness to fully share their technology.
Only established, reputable and financially sound foreign banks shall be allowed entry in accordance with Section 2 of this Act. The foreign bank applicant must be widely-owned and publicly-listed in its country of origin, unless the foreign bank applicant is owned and controlled by the government of its country of origin.
In the exercise of this authority, the Monetary Board shall adopt such measures as may be necessary to ensure that the control of at least sixty percent(60%) of the resources or assets of the entire banking system is held by domestic banks which are majority-owned by Filipinos.[...]" (Sec. 1 and 2 of RA 10641)
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"Section 7. Board of Directors.— Non-Filipino citizens may become members of the Board of Directors of a bank to the extent of the foreign participation in the equity of said bank." (Sec. 7 of RA 7721)
Sec. 2 RA 10641
Sec. 7 7721
[<a href="https://lawphil.net/statutes/repacts/ra2014/ra_10641_2014.html&hl=en&gl=fr&strip=1&vwsrc=0">Act</a>],[<a href="https://www.bsp.gov.ph/Regulations/Banking%2520Laws/RA7721.pdf&cd=1&hl=en&ct=clnk&gl=fr">Act</a>]