Disclosure and Transparency
The Banks remains committed to upholding high standards of disclosure and transparency to enable the investment community to understand the true financial condition of the company. The Bank submits various periodic and non-periodic reports required under applicable laws and regulations. It submits current reports to the SEC and the PSE, as necessary, to make full, fair, accurate and timely disclosures to the public on material facts or events that may reasonably be expected to affect investors’ decision in relation to the Bank’s securities.
The Bank’s audit system is a vital force to its corporate governance regime. Directly reporting to the Board’s Audit Committee, the Bank’s Internal Audit Division (IAD) provides reasonable assurance to the Board, Senior Management, and its Stockholders that the Bank’s internal control, risk management and governance systems and processes are effective. This involves providing assurance that Bank’s key organizational and procedural controls are effective, appropriate, and complied with. It conducts its audit in accordance with International Standards for the Professional Practice of Internal Auditing of Institute of Internal Auditors. IAD conducts audits in frequencies commensurate with the assessed levels of risk in specific banking areas comprising its audit universe. It also conducts special administrative investigations when required to do so pursuant to the Bank’s Code of Conduct. The Division has its own charter which directs performance of its functions. IAD is headed by Ms. Myrna E. Amahan, a Vice President of the Bank.
The Bank engages the services of an independent external auditor, who examines the financial statements of the Bank in accordance with generally accepted auditing standards and expresses its opinion on the fairness of its presentation upon completion of such examination.
The Bank’s Audit Committee has the primary responsibility to recommend the appointment, re-appointment and removal of external auditors, subject to approval by the Board of Directors and confirmation of the stockholders.
At present, the Bank’s external auditor is Punongbayan and Araullo. They were reappointed as such during the annual stockholders meeting on May 23, 2014. A brief profile of the Bank’s present external auditor and the services it provides is as follows:
External Auditor- Punongbayan & Araullo Profile
Punongbayan & Araullo (P&A) is the Philippine member firm of Grant Thornton International Ltd (GTIL) , one of the world’s leading organizations of independently owned and managed accounting and consulting firms. The firm is likewise accredited by the SEC and the BSP and holds office at the 20th Floor of Tower I , The Enterprise Center, 6766 Ayala Avenue, 1200, Makati City, Metro Manila.
Services to the Bank
In 2016, P&A’s services consisted of the audits of consolidated and separate financial statements of the Bank as of and for the year ending 31 December 2016 (both under Philippine Financial Reporting Standards and Regulatory Accounting Practices)
There are neither changes in, nor disagreements with, the external auditors on any of the accounting or financial disclosures.
Fair Securities Dealing
To continually uphold transparency and integrity in the trading of its securities, the Bank has adopted a Trading Guidelines and Blackout Policy. This aims to apprise and to ensure compliance by all "covered persons" of the Bank with their obligations under the SRC and other securities rules and regulations relating to the trading or dealing of the Bank's shares. Covered Persons refer to directors, principal officers and all other employees of the Bank who are made aware of undisclosed material non-public Information, including their immediate families living in the same household. To protect the investing public, the Chief Compliance, and Corporate Governance Officer issues notices of trading blackout which prohibits the trading of the Bank's shares within defined periods before and after material non-public information are disclosed and made available to the public. Directors, principal officers of the Bank and the rest of the covered persons are also mandated to report to the Stock Transfer Unit or the Human Resource Group their transactions involving the Bank's shares or any changes therein no later than one (1) trading day after such transaction/s.
Governance Evaluation System
The Bank utilizes various metrics to ascertain its state of corporate governance. External ratings and surveys of regulatory agencies and private organizations form part of the Bank’s governance evaluation system. Currently, the Bank applies the principles of the ASEAN Corporate Governance Scorecard in evaluating its governance regime. This scorecard is designed to raise the corporate governance standards of ASEAN countries and is being implemented to all publicly listed companies (PLCs) across the ASEAN by its Capital Markets Forum (ACMF), a body composed of region’s capital market regulators. In the ASEAN Corporate Governance scorecard run for 2014, the Bank ranked among the top 50 PLCs that scored well on governance.
In 2014, the Bank submitted its Annual Corporate Governance Report (ACGR) to the SEC. The ACGR provides information on how it complies with, and observes leading governance principles and practices.
The Bank remains 97% compliant with the Corporate Governance Guidelines of the PSE as reflected in its Compliance Report on said Guidelines, which was submitted to the PSE last April 22, 2014.
In addition, the Bank utilizes internal measures to obtain a view of its governance condition from the performance of its own Board and its Committees, through their conduct of annual of self-assessment.
Overall, the Bank deems that it fully complies with the provision of its CG Manual as well as with established governance principles.