Banknotes

Denominations

Currently, the SPC produces the following denominations of banknotes for circulation:

20-Piso 200-Piso

50-Piso

500-Piso

100-Piso

1000-Piso

Although the production of 5-Piso and 10-Piso notes has been discontinued since 1996 and 2002,

respectively, they are still considered legal tender.

Volume of banknotes for printing

The Monetary Board approves the required quantities of banknotes to be produced annually by SPC. The banknote requirements are based on cash operations data, economic indicators as well as the projected needs of the regional cash units of the BSP.

Circulating life of a banknote

The circulating life of banknotes ranges from one to five years, depending on the circulating frequency and cash handling habit of the general public. Since the lower denominations circulate faster, they

have a much shorter lifespan than the higher denominations.

Security features of a banknote

The security features of banknotes consist, among others, of security thread, security fibers, watermarks, invisible fluorescent inks, optically variable ink, microprint and moire pattern and iridescent band.

How a banknote is made

The making of a banknote starts with the conceptualization of design. The concept is drawn by an artist into a prototype banknote. Once the prototype is approved, a master die is prepared from which printing plates are produced. Production then takes

place involving the following steps:

Litho Printing. Impressions are printed on a rubber blanket cylinder. These are in turn transferred to the sheets of banknote paper. Both sides of the sheets are printed simultaneously with multi-color or rainbow background prints.

Intaglio Printing. After the background colors are printed, engraved features of the banknote are printed at the intaglio machines, which produce the tactile or embossed effect on the banknotes.

Sheet Inspection. The printed sheets are inspected for printing faults. Defective notes are cancelled and incinerated for security reasons.

Numbering. The good sheets go to the numbering machines for the printing of serial numbers.

Tenning. Numbered sheets undergo inspection of every tenth sheet for other printing defects which were not detected earlier.

Finishing. The numbered sheets finally go through finishing which involves cutting into notes, counting, packaging.

Commemorative Notes

The BSP issues special notes to commemorate significant events of national interests.

Commemorative notes may vary in size from ordinary circulation notes. Some commemorative issues may use the circulation note but with an overprint of the text descriptive of the significant event or person.

Some examples of Banknote with Overprint:

Year Occasion/Description of Overprint

Denomination

1999 50 Years of Central Banking in the Philippines

50-Piso

1998 National Centennial Commission

100-Piso

1989 Kababaihan Para sa Kaunlaran

5-Piso

1990 5th Plenary Council

of the Philippines 5-Piso

2004 International Year of Microcredit

20-Piso

Commemorative banknotes issued include:

The 100,000-Piso Centennial Commemorative Notes – measuring 22 cm by 33 cm, it is the biggest legal tender issued by the BSP, both in terms of face value and dimension. Only 1,000 notes were issued on the occasion of the 1998 Philippine Centennial Year.

The 2,000-Piso Centennial Commemorative Notes – launched in December 1998, the banknote measures 216 mm by 133 cm.

1998 Commemorative Note

Commemorative Philippine Centennial Note Obverse: Panunumpa sa tungkulin ni Pangulong Joseph E. Estrada sa Simbahan ng Barasoain, Malolos,

Bulakan noong ika-30 ng Hunyo 1998 Reverse: Pagdiriwang ng Sentenaryo ng Kalayaan sa Kawit, Cavite na pinangunahan ni Pangulong Fidel V. Ramos noong ika-12 ng Hunyo 1998 Face Value: 2,000-Piso Packaging: Blue Album

Price: P 2,100.00

Clean Note Policy of the BSP

Basic Information from BSP Circular No. 61 Series of 1995 entitled "Consolidated Rules and Regulations on Currency Notes and Coins"

CLEAN NOTE POLICY

To effect an expeditious withdrawal from circulation of unfit Philippine currency notes classified under Section 15, Chapter V of Circular No. 61, banks and their branches shall observe the following guidelines and procedures when making cash deposits with the Cash Department or any of the Regional Offices / Branches of BSP:

a. Banks shall classify their cash deposits into two types: (1) clean or fit notes and (2) dirty or unfit notes in accordance with the “Currency Guide for Bank Tellers, Money Counters and Cash Custodians” prepared by the Cash Department of the BSP. The notes thus classified shall be

further sorted by series and denomination.

b. Banks shall provide securely sealed bags or containers separately for the clean or fit notes and for the dirty or unfit notes accompanied by a deposit slip for each type/category. The deposit slip for the unfit currency notes shall be clearly labeled as “unfit.”

c. To facilitate handling of deposits, banks’ deposits shall be packed in sealed bags or containers in standard quantity of twenty (20) full bundles per denomination (each bundle containing 1,000 notes in ten (10) equal straps, each strap containing 100 notes).

d. Provincial branches of banks may make direct deposits of currency notes, duly identified and sorted, with the nearest Bangko Sentral Regional Office/Branch. In areas where there are no Bangko Sentral Regional Office/Branch, provincial branches of banks shall arrange with their respective Head Offices the shipment of their unfit or dirty notes for deposit with the Cash Department of BSP in Manila. Cost of shipment and other related expenses to be incurred shall be solely for the account of the bank concerned.

REPLACEMENT AND REDEMPTION OF LEGAL TENDER PHILIPPINE CURRENCY NOTES AND COINS CONSIDERED MUTILATED OR UNFIT FOR CIRCULATION

Section 56 of Republic Act No. 7653, or the New Central Bank Act, provides that: “The Bangko Sentral shall withdraw from circulation and shall demonetize all notes and coins which for any reason whatsoever are unfit for circulation and shall replace them by adequate notes and coins. Provided, however, that the Bangko Sentral shall not replace notes and coins the identification of which is impossible, coins which show signs of filing, clipping or perforation, and

notes which have lost more than two-fifths (2/5) of their surface or all of the signatures inscribed thereon. Notes and coins in such mutilated condition shall be withdrawn from circulation and demonetized without compensation to the bearer.”

A currency note shall be considered unfit for circulation when:

a. It contains heavy creases which break the fiber of the paper and indicate that disintegration has begun. Provided, however, that mere creasing or wrinkling which has not broken nor weakened the note does not render the note unfit for circulation; or

b. It is badly soiled/contaminated and/or with writings even if it has proper life or sizing; or

c. It presents a limp or rag-like appearance.

A currency note shall be considered mutilated when:

a. Torn parts of banknotes are joined together with adhesive tape in a manner which tries to preserve as nearly as possible the original design and size of the note; or

b. The original size of the note has been reduced/lost through wear and tear or has been otherwise torn, damaged, defaced or perforated through action of insects, chemicals or other causes; or

c. It is scorched or burned to such an extent that although recognizable as such, it has become frail and brittle as to render further handling thereof impossible without disintegration or breaking; or

d. It is split edgewise; or

e. It has lost all the signatures inscribed thereon.

A currency coin shall be considered unfit for circulation when:

a. It is bent or twisted out of shape or defaced, but its genuineness and/or denomination can still be readily and clearly determined/identified; or

b. It has been considerably reduced in weight by natural abrasion/wear and tear.

A currency coin shall be considered mutilated when:

a. It shows signs of filing, clipping or perforation; or

b. It shows signs of having been burned or has been so defaced, that its genuineness and/or denomination cannot be readily and clearly identified.

Currency notes and coins considered unfit for circulation shall not be re-circulated, but may be presented for exchange to or deposited with any bank.

Currency notes and coins considered mutilated shall not be re-circulated nor deposited/exchanged, but may be presented or forwarded, for determination of their redemption/exchange value to:

a. The Cash Department Bangko Sentral ng Pilipinas Security Plant Complex, East Avenue, Diliman, Quezon City

b. The nearest Bangko Sentral Regional Office/Branch

REPRODUCTION AND/OR USE OF FACSIMILES OF LEGAL TENDER PHILIPPINE CURRENCY

NOTES

Section 8. No person or entity, public or private, shall design, engrave, print, make or execute in any other manner, or utter, issue, distribute, circulate or use any handbill, advertisement, placard, circular, card, or any other object whatsoever bearing the facsimile, likeness or similitude of any legal tender Philippine currency note, or any part thereof, whether in black and white or any color or combination of colors, without prior authority therefore having been secured from the Governor, BSP or his duly authorized representative.

Section 9. The reproduction and/or use of facsimiles or any illustration bearing the likeness or similitude of legal tender Philippine currency notes referred to in the foregoing section may be authorized by the Governor, BSP or his duly authorized representative, for printed illustrations in articles, books, journals, newspapers or other similar materials and strictly for numismatic, educational, historical, newsworthy or other purposes which will maintain, promote or enhance the integrity and dignity of said note, provided, however, that any such facsimile or illustration shall be of a size

less than three-fifths (3/5) or more than one and one-half times (1 1/2) times in size of the currency note being illustrated and that there will be no deviation from the purpose for which the notes will be used.

CHAPTER III

REPRODUCTION AND/OR USE OF FACSIMILES OF LEGAL TENDER PHILIPPINE CURRENCY COINS

Section 10. No person or entity, public or private, shall design, engrave, make or execute in any manner, or use, issue, or distribute any object whatsoever bearing the likeness or similitude

as to design, color or the inscription thereon of any legal tender Philippine currency coin or any part thereof, in metal form, irrespective of size and metallic composition, without prior authority from the Governor, BSP or his duly authorized representative.

Section 11. The reproduction and/or use of facsimiles or of any object bearing the likeness or similitude of legal tender Philippine currency coins referred to in the foregoing section may be authorized by the Governor, BSP or his duly authorized representative, strictly for numismatic, educational,

historical and other purposes which will maintain, promote or enhance the integrity and dignity of said coins.

Penalties

Section 25. Any violation of the provisions of Section 8 and 9, Chapter II, and Sections 10 and 11, Chapter III, of this Circular, shall subject the offender to imprisonment of not less than five (5) years, but not more than ten (10) years. In case the Revised Penal Code provides for a greater penalty, then that penalty shall be imposed.

BSP Gold Buying Program

The BSP purchases gold from small-scale miners in accordance with Republic Act No. 7076 (People’s Small Scale Mining Act of 1991) and from other sources. It then refines the gold purchased to forms acceptable in the international bullion markets.

The BSP has five existing buying stations located in Quezon City, Baguio City, Davao City, Zamboanga City, and Naga City.

GUIDELINES – BSP GOLD BUYING PROGRAM

1. Gold may be sold to the

Bangko Sentral ng Pilipinas (BSP) through its buying stations in the Mint and Refinery Operations Department (MROD) in Quezon City and in the Bangko Sentral regional offices in Davao City (BSRO-Davao), Zamboanga City (BSRU-Zamboanga), Baguio City (BSRU-Baguio) and Naga City (BSRU-Naga).

2. The Bangko Sentral shall purchase the refined gold in Philippine pesos (PHP), at the prevailing international gold market price and prevailing PHP / USD exchange rate set by the BSP Treasury

Department on a daily basis.

3. Gold traders / residents intending to sell their gold to the Bangko Sentral shall address and present to the Office of the Director, MROD (if sold to the MROD buying station) or to the Office of the Regional Administrator (if sold to the regional buying stations), their “Letter of Delivery and Sale” clearly indicating that the gold is offered for sale for value on the date of delivery and must be received not later than 2:00 p.m. of the advice date. Advices received after 2:00 p.m. purporting to sell gold

shall be for value on the following business day.

NOTES:

a. Forms of the “Letter of Delivery and Sale” shall be provided by BSP.

b. Xerox or other reproduced copies shall not be allowed / accepted.

4. Requirements for Acceptance:

a. Physical Form

1. Bar or disc (powder is not accepted).

2. Should not contain mercury or amalgam in any quantity.

3. Free of slags and other foreign matter.

4. No sign of metallic segregation / layering or poured shortness.

5. Should not be damp or wet.

b. Maximum Dimensions

1. Bar : 16.5 cm (6.5”) long x 8 cm (3”) wide x 4 cm (1.5”) thick

2. Disc : 10 cm (4”) diameter x 5 cm (2”) thick maximum

c. Weight

1. Maximum weight of bar/disc shall be

approximately 160 tr. oz. (5 kgs.)

2. Maximum weight per lot shall be approximately 320 tr.oz. (10 kgs.)

d. Minimum Gold Assay – 30%

e. For first time sellers - Accomplishment of Specimen Signature Card with picture and name/s of authorized representative/s.

5. Payment Scheme:

a. Initial payment equivalent to 99% of the value of the delivery based on as-received weight and

approximate assay by specific gravity method, shall be paid the following business day after date of delivery / sale, depending on the volume of purchase.

b. Final settlement of the balance shall be paid upon completion of evaluation melting and final assay or within thirty (30) calendar days from date of delivery / sale, depending on the volume of purchase.

6. Deductions (processing cost and metal recovery factors) shall be applied in accordance with the following

schedule:

Bar Assay Fineness

Processing Cost** (PHP / tr.oz. of material

received)

Metal Recovery Factor,

%

995 and above

PHP 34.00 99.8

900 to less than

995 37.77 99.3

700 to less than

900 39.37 99.0

500 to less than

700 42.17 98.9

300 to less than

500 45.67 98.6

Silver Recovery – 97% for assay of 1% and higher; no recovery for assay below 1%

** 1. Minimum charge of PHP 1,600.00 per delivery 2. Additional assay fee of PHP 1,600.00 per lot in excess of one (1) lot per delivery.