President Rodrigo Duterte has exempted the Overseas Filipino Bank, state-owned and controlled corporation, from remitting 50% of its annual net earnings to the national government for year 2016.

This developed after the President issued Executive Order (EO) 146 which was dated August 5 but released on August 6, Friday.

EO 146 argues that such exemption is provided under Republic Act 7656 or Dividend Law which states that the President, upon the recommendation of the Finance Secretary, may adjust the percentage of annual net earnings to be declared by a state-owned and controlled corporation in the interest of national economy and welfare.

“The Secretary of Finance has recommended the downward adjustment of the percentage of net earnings that will be declared by the Overseas Filipino Bank in Calendar Year 2016 in order to support the capital position of the Overseas Filipino Bank and allow it to comply with Bangko Sentral ng Pilipinas regulations as well as support the Bank’s short- and long-term plans and programs for Filipinos overseas, in the interest of national economy and general welfare,” the EO read.

“Pursuant to RA 7656, the percentage of net earnings to be declared and remitted by the Overseas Filipino Bank to the National Government for 2016 is adjusted from 50% of its annual earnings to 0%. This Order will take effect immediately,” the EO added.

The Overseas Filipino Bank was the former Philippine Postal Savings Bank.

The Philippine Postal Savings Bank was converted to Overseas Filipino Bank in October 2017 when President Rodrigo Duterte issued EO 44.

EO 44 states that the Overseas Filipino Bank was created due to the “need to establish a policy bank dedicated to provide financial products and services tailored to the requirements of overseas Filipinos, and focused on delivering quality and efficient foreign remittance services.”