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Monday, October 23, 2017 | MANILA, PHILIPPINES
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   banking report
Date posted: Monday, May 30, 2016 | Manila, Philippines

1st Quarter Banking Report (2016)

Quick takes on KYC, KYB (know your banker)

WE ASKED two of the country’s top banks -- BDO Unibank, Inc. (BDO) and Bank of the Philippine Islands (BPI) -- about their know-your-customer (KYC) and know-your-banker (KYB) policies, and they gave us the following answers:

1. How does your bank implement the KYC policy and how do you evaluate clients opening new accounts?

BDO: The Bank complies with the regulatory requirements for account on-boarding as defined in the implementation of KYC by obtaining information on the personal or corporate clients (e.g., personal information, source of income/business, etc) and require the submission of supporting account opening documents like acceptable identification documents and business records. Interviews are conducted by the branch personnel to evaluate if prospective clients would be acceptable to open an account with the bank.

BPI: KYC is a basic procedure to determine the true identity of all customers seeking to avail of the bank’s products and services. In BPI, we maintain a stringent process in making sure the profile of our clients is evaluated and verified carefully. KYC procedures include the following procedures: (1) Physical presence or face-to-face contact for all clients; (2) Presentation of valid ID with picture; (3) Completion of Customer Information Sheet; and (4) Signing of specimen signature card. In evaluating clients, the bank checks the background profile of the client, including the source of funds, country of business, origin and residence, types of business activities and transactions, position in the private or public sector and materially linked accounts. The bank also watches out for the list of individuals and entities engaged in illegal or terrorist-related activities.

2. How do you ensure that each of your branches comply with the requirements of the BSP in terms of knowing your clients?

BDO: Bank employees are provided with guidelines/policies which defines the requirements for account opening and conduct of proper KYC for new accounts. In addition, training is provided to ensure that the bank’s policies, procedures and controls are known to the bank employees. Controls are also in place in the branch through the supervision of their branch officers and respective area and region within Branch Banking. Audits/independent reviews are also conducted periodically by Internal Audit and Compliance to ensure adherence to the bank’s policies and procedures.

BPI: Compliance to these requirements is part of the branch officers’ performance rating. Our branches undergo regular audit by the BSP, BPI’s Internal Audit Group and AML (Anti-Money Laundering) Department. Through this, the regulatory and internal processes and policies are checked. Actual conduct of compliance testing in the branches is also done by the BPI AML Team and Compliance Team of the Retail Banking Group.

3. How does your bank comply with BSP’s Memorandum 2016-005?

BDO: Even prior to the reported leakage of sensitive voter information kept by the Comelec, the bank has instituted stricter account opening requirements where the client needs to present two valid identification documents (regulations require a minimum of only one ID). Further, interviews are conducted with prospective new accounts and information provided and supporting account opening documents are validated.

BPI: The bank has the strictest and most stringent measures in protecting the data of our clients. Our protocols require us to go beyond the usual static information such as the complete name and birthday and we ask for other information that only the clients are expected to know. Biometric data is not being used in BPI to effect transactions.

4. How does your bank choose its executives and branch heads?

BDO: Officers are hired based on their relevant work experience in other banks in similar role and/or functional scope. Both technical and behavioral competencies are assessed for job role fit. Relevant background verification checking, including past performance and employment related info/record, as well as credit standing, and industry association membership reputation, as available, are considered in the selection process.

BPI: As a bank, we believe in our responsibility to our people. We seek to hire the best people for each job -- may it be its leadership capabilities, technical abilities and even soft skills. We promote a culture of mutual respect, meritocracy, performance and teamwork. -- Christine Joyce S. Castañeda

*Send e-mail to Christine at cscastaneda@bworldonline.com or follow her on Twitter @cjscastaneda.

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