An Act Creating the National Cottage Industries Bank, Defining its Powers, Functions, and Objectives

REPUBLIC ACT No. 3756

An Act Creating the National Cottage Industries Bank, Defining its Powers, Functions, and Objectives

Be it enacted by the Senate and House of Representatives of the Philippine Congress Assembled:

Section 1. Name, domicile and place of business. -There is hereby created a bank to be known as the National Cottage Industries Bank. Its principal domicile and place of business shall be in the City of Manila.

Section 2. Corporate Powers. -The said Bank shall be a body corporate and shall have power:

Section 3. Capitalization— Authorized Capital Stock, Par Value. -The Bank shall have an authorized capital stock of thirty million pesos divided into three hundred thousand par value shares of one hundred pesos each. The shares shall be divided into two groups marked Series "A" and Series "B":

Section 4. Board of Directors, Composition and Organization. -The affairs and business of the Bank shall be directed and its property managed and preserved, unless otherwise provided in this Act, by a Board of Directors which shall be composed of a chairman, vice-chairman, and five members. The Secretary of Commerce and Industry shall be the chairman of the Board of Directors, and the Administrator of the National Cottage Industries Development Authority shall be the vice-chairman. The President of the Republic of the Philippines shall appoint two members of the Board and the other three shall be elected by the stockholders in a general election called for that purpose; Provided, However, That the first Board of Directors shall be all appointed by the President of the Republic of the Philippines for the first year of operation of the Bank. The two appointive members of the Board shall hold a term of office for two (2) years depending upon the discretion of the President of the Republic of the Philippines. The members of the Board shall be paid a per diem of twenty-five pesos per session actually attended but not exceeding two hundred fifty pesos a month.

Section 5. Fiscal Year. -The fiscal year of the Bank shall commence on July first and end on June thirtieth of the succeeding year.

Section 6. Election of the three members of the Board of Directors. -The annual meeting of stockholders shall be held on the first Saturday of March of each year for the purpose, among other things, of electing three elective members of the Board of Directors, and of transacting such other business as may be contained in the agenda. In this election, the shares held by the government shall not be entitled to vote.

Section 7. Officers. -The Bank shall have the following officers; a president, a vice-president, a secretary, a treasurer by the Board of Directors. Their compensation and tenure of office shall be fixed also by the Board.

Section 8. Duties of Directors and Officers. -The duties and responsibilities of directors and officers shall be as prescribed in the regulations and by-laws of the Bank.

Section 9. Powers of the Board of Directors. -(a) To formulate policies necessary to carry out effectively the provisions of this Act, and adopt such by-laws, rules and regulations for the effective operation of the Bank, in conformity with this Act and existing laws; and

Section 10. Other officers and employees. -Other officers and employees of the Bank shall be appointed by the President of the Bank and confirmed by the Board. No officer or employee of the Bank shall be removed except for just cause and upon confirmation by the Board.

Section 11. Every director, officer, and employee handling funds, securities and property on behalf of the Bank shall, subject to regulations, execute and deliver adequate bonds for the faithful performance of his duties and obligations.

Section 12. Inspection of the Bank— Supervision and examination by the Central Bank of the Philippines. -The Bank shall be subject to supervision and examination by the Central Bank of the Philippines.

Section 13. Acquisition and Disposal of Real Estate -Right to purchase, hold and dispose of real estate.— The Bank is hereby authorized to purchase and own such real estate as may be necessary for the purpose of carrying on its business and incidental to its operation of activities. It is also authorized to hold such real estate as it may find necessary to acquire in the collection of debts due to the said Bank or to its branches, but real estate acquired in the collection of debts shall be sold by said Bank within five years after date of its acquisition.

Section 14. Payment of Dividends— Payment into the Philippine Treasury of dividends corresponding to Government owned shares. -All profits assigned as dividends to the shares of the Government shall be paid into the Treasury of the Philippines for the general funds thereof.

Section 15. Payment to stockholders of dividends corresponding to private-owned shares. -All profits assigned as dividends to shares of stockholders shall be paid to the duly registered stockholder of the Bank.

Section 16. Funds— Appropriations. -To carry out the purposes of this Act, the sum of twenty million pesos is hereby appropriated, out of any funds in the National Treasury not otherwise appropriated, which shall constitute as the share of the government in the capitalization of the Bank.

Section 17. Definition of Terms. -The words used in this Act shall be construed as follows:

Section 18. Miscellaneous provisions— Matters not covered by this Act. -The provisions of Republic Act Numbered Three hundred thirty-seven, otherwise known as the General Banking Act, shall apply to the operation of the Bank in matters not otherwise specifically provided for in this Act.

Section 19. Penal provisions— Penalties for violations of the provisions of this Act. -Any director, officer, employee, or agent of the Bank, who violates or permits the violation of any of the provisions of this Act, or any person aiding or abetting the violation of any of the provisions of this Act, shall be punished by a fine not to exceed ten thousand pesos or by imprisonment of not more than five years, or both, at the discretion of the court.

Section 20. Application of the Revised Penal Code. -The provisions of Title Four, Chapter One of Act Numbered Thirty-eight hundred and fifteen, known as the Revised Penal Code, are hereby made applicable to violations of the law consisting in making or causing to be made, and circulating or causing to be circulated, forged checks and notes and bonds in imitation of those of the Bank.

Section 21. Repealing Clause. -All Acts or parts of Acts inconsistent or incompatible with the provisions of this Act are hereby repealed.

Section 22. This Act shall take effect upon its approval.

Approved: June 22, 1963.