Directors’ Handbook - BPI-Philam · 2019-06-14 · BPI-Philam confidential and proprietary information. Not for distribution. About AIA About AIA AIA Group Limited and its subsidiaries

BPI-Philam confidential and proprietary information. Not for distribution.

Directors’ Handbook


Table of Contents

PART I Company Overview

PART II Board of Directors

PART III Board Committees

PART IV Reportorial Requirements for Directors

PART VDirectors and Officers Liability Insurance

Coverage Summary


PART I

COMPANY OVERVIEW


About BPI-Philam & Philam Life

About BPI-Philam

BPI-PHILAM LIFE ASSURANCE (BPLAC) CORP. is a strategic

alliance between two leading financial companies in the Philippines

– The Philippine American Life and General Insurance (PHILAM

LIFE) Company and Bank of the Philippine Islands (BPI). BPI-

Philam is also part of the AIA Group, the largest independent

publicly listed pan-Asian life insurance group – with a presence in

18 markets across the Asia-Pacific region.

About Philam Life

The Philippine American Life and General Insurance Company (Philam Life) is the

country’s premier life insurance company. Established on 21 June 1947, Philam Life has

earned the trust of customers for its financial strength, strong brand name, and ability to

deliver on its promises.

Philam Life has PHP251.4 billion in total assets as of 31 December 2017, while serving

almost 600,000 individual policyholders and over 2,200,000 insured group members.

Philam Life understands the needs of its customers and provides holistic solutions that

include life protection, health insurance, savings, education, retirement, investment,

group, and credit life insurance. It also offers bancassurance and fund management

products and services through its subsidiaries—BPI-Philam Life Assurance Company

(BPLAC) and Philam Asset Management Inc. (PAMI).

Philam Life is a member of AIA Group Limited, the largest independent publicly listed pan-

Asian life insurance group.


About AIA

About AIA

AIA Group Limited and its subsidiaries (collectively “AIA” or the “Group”) comprise the largest independent

publicly listed pan-Asian life insurance group. It has presence in 18 markets in Asia-Pacific–wholly-owned

branches and subsidiaries in Hong Kong, Thailand, Singapore, Malaysia, China, Korea, the Philippines,

Australia, Indonesia, Taiwan, Vietnam, New Zealand, Macau, Brunei, Cambodia, a 97 per cent subsidiary in Sri

Lanka, a 49 per cent joint venture in India and a representative office in Myanmar.

The business that is now AIA was first established in Shanghai almost a century ago in 1919. It is a market

leader in the Asia-Pacific region (ex-Japan) based on life insurance premiums and holds leading positions

across the majority of its markets. It had total assets of US$221 billion as of 30 June 2018.

AIA meets the long-term savings and protection needs of individuals by offering a range of products and

services including life insurance, accident and health insurance and savings plans. The Group also provides

employee benefits, credit life and pension services to corporate clients. Through an extensive network of

agents, partners and employees across Asia-Pacific, AIA serves the holders of 32 million individual policies and

over 16 million participating members of group insurance schemes.

AIA Group Limited is listed on the Main Board of The Stock Exchange of Hong Kong Limited under the stock

code “1299” with American Depositary Receipts (Level 1) traded on the over-the-counter market (ticker symbol:

“AAGIY”).


Capital Structure

Authorized Capital Stock - P1Billion

Subscribed & Paid-Up Capital Stock - P749,993,979.00

Par Value - P1.00 per share

Treasury Share - P6,000

Financial Year End - 31 December

Relevant Regulator - Insurance Commission

External Auditor - Isla Lipana & Company

LIST OF STOCKHOLDERS

Total No. of Amount Percent of

Name of Stockholder Shares Subscribed and Nationality Ownership

Subscribed Paid-Up

1

THE PHILIPPINE AMERICAN LIFE AND

GENERAL INSURANCE COMPANY 382,496,926 382,496,926.00

Hong Kong

SAR 51.00%

2 Chan, Jacky 1 1.00 Chinese

3 Surendra, Menon 1 1.00 Singaporean

4 Ang, Kelvin 1 1.00 Malaysian

5 Tambunting, Jesus P. 1 1.00 Filipino

6 BANK OF THE PHILIPPINE ISLANDS 357,554,432 357,554,432.00 Filipino 47.67%

7 Consing, Cezar P. 100 100.00 Filipino

8 Ang, Jesse 100 100.00 Filipino

9 Lukban, Consuelo A. 100 100.00 Filipino

10 OTHERS (Minority Stockholders) 9,942,317 9,942,317.00 Filipino 1.33%

TOTAL 749,993,979 749,993,979.00 100.00%


Board of Directors & Corporate Officers

BOARD OF DIRECTORS

1. Jacky Chan

2. Kelvin Ang

3. Cezar P. Consing

4. Surendra Menon

5. Consuelo A. Lukban

6. Jesse Ang

7. Jesus P. Tambunting

SENIOR OFFICERS

Arleen May S. Guevara - Investment Officer

Gary James Ogilvie - Senior Vice President

Katherine P. Custodia - Head of Partnership Distribution

Sales Channels

Jose Ivan Tuazon Justiniano - Head of Compliance

Joseph G. De Dios - Chief Risk Officer

Shiela P. Alarcio - Head of Audit

Arvin C. Matuloy - Head of Treasury

J. Vincent R. Daffon - Head of Fixed Income Securities Trading

Charline D. Chan-Fong - Appointed Actuary

Monica F. Bondoc - Head of Human Resources

Yvette Michelle L. Yao - Head of Enterprise Digital Development

& Business Analytics

Melissa M. Escala - Head of Shared Services Management

Ma. Loisa H. Celorico - Head of Strategy and Customer

Segments

Patrick Gerard Joseph B. Lim - Head of Partnership Distribution

Support

Cecile G. Lizares - Head of Institutional Division

Celeste Joy C. Linsangan - Head of Partnership Customer

Marketing

OTHERS

Johannes D. De Ramos - Head of Direct Marketing- Citi-AIA

Felisa B. Ronan - Head of Preferred Segment

Jenny Anne T. Dones - Asst. Corporate Secretary

CORPORATE OFFICERS

Wing Shing (Jacky) Chan - Chairman of the Board

Surendra Menon - Chief Executive Officer

Spencer T. Yap - Treasurer and Chief Finance

Officer

Carla J. Domingo - Corporate Secretary

Ace Devino A. Custodio - Asst. Corporate Secretary


Our Affiliates


Philam Group Structure

PHILAM EQUITABLE LIFE ASSURANCE COMPANY, INC.(formerly Equitable-PCI Life

Insurance Corporation)

Philam Life 100%

AUTHORIZED CAPITAL STOCKP600,000,000.00

Subscribed & Paid-up:P250,000,000.00

Par Value: P10.00

PHILAM PROPERTIES CORP.

Philam Life 100%

Authorized Capital Stock:P625,000,000.00

a.) Common - P300Mb.) Preferred 'B' - P325M

Subscribed & Paid-up Capital Stock:P400 Million

a.) Common - P75Mb.) Preferred 'B' - P325M

Par Value: P100.00

TOWER CLUB, INC.

Philam Properties 80.000%Others 20.000%

AUTHORIZED CAPITAL STOCKP262,000,000

600 Club A Shares (P200,000/share)1,400 Club B Shares (P100,000/share)

2,000 Club C Shares (P1,000/share)

Subscribed Capital: P262,000,000 600 Club A Shares

1,400 Club B Shares2,000 Club C Shares

Paid-up Capital: P262,000,000.00

PHILAMLIFE TOWER MGMT. CORP.

% OF OWNERSHIP AS TO TOTALSSS 30.4196%Philam Life 33.9964%PRC 10.8659%PPC 6.6050%KRC 3.3330%BPI-AMTG (as trustee of PERF)

14.7801%

AUTHORIZED CAPITAL STOCK: P15MP7,500,000 CommonP7,500,000 Redeemable

SUBSCRIBED & PAID-UP: P8,800,000 P7,088,054 CommonP1,711,946 Redeemable

Par Value: P1.00

PHILAMLIFE TOWER CONDOMINIUM CORP.

(Non-Stock Corporation)

UNIT OWNERSPhilam Life 32.7558%PPC 2.6458%PTRC (ITF PPC) 2.1848%18/F 1.5988%SSS 26.9578%PTRC (ITF SSS) 2.1103%45/F 1.2768%

BPI-AMTG (as trustee of PERF)

14.0485%Perf Realty Corp.

10.3873%Kapatiran Realty Corp. 3.1661%Wilfredo Keng 1.5824%Frabelle Properties 0.7438%BPI Family Bank (Far East) 0.5418%

PHILAM CALL CENTER SERVICES, INC.

(Formerly Philam Insurance Agency & Call Center Services,

Inc.)

Philam Life 100%

AUTHORIZED CAPITAL STOCKP80,000,000

Subscribed Capital:P20,000,000

Paid-up Capital:P8,000,000

Par Value: P100.00

THE PHILIPPINE AMERICAN LIFE AND GENERAL INSURANCE (PHILAM LIFE) COMPANY

Authorized Capital Stock: P2,000,000,000 Subscribed and Paid-Up: P1,995,606,710.00No. of Shares Issued & Outstanding: 199,560,671 shares

Treasury Shares: 439,329 sharesPar Value: P10.00

AIA COMPANY LIMITED

KAPATIRAN REALTY CORP.

Philam Life 40.0000%PERF Realty Corp. 30.0000%BPI/SPSP/PERF 30.0000%



Par Value: P100.00

PERF REALTY CORP.

Philam Life 39.0000%

BPI as Trustee 61.0000%of Philamlife EmployeesRetirement Fund (PERF)



Par Value: P100.00

PHILAM ASSET MANAGEMENT, INC.

Philam Life 100%



Par Value: P100.00

PHILAM FOUNDATION, INC.

MEMBERS:PHILAM LIFE; BPI-Philam Life

Assurance Corp.; Philam Asset Mgmt., Inc.; Philam Call Center Services, Inc.; Philam Properties

Corporation

INITIAL CONTRIBUTION:P50,000

BPI-PHILAM LIFE ASSURANCE (BPLAC)

CORPORATION(formerly Ayala Life Assurance, Inc.)

Philam Life 51.0000%BPI 47.6743%Others 1.3257%

AUTHORIZED CAPITAL STOCKP1 Billion


Treasury Shares:P6,000.00

Par Value: P1.00


PART II

BOARD OF DIRECTORS


Composition, General Power, Duties &

Responsibilities of the Board of Directors

Article VI of the Articles of Incorporation provides that the government of the Corporation

shall be under a Board of Directors composed of eleven (11) directors.

TITLE III

BOARD OF DIRECTORS/TRUSTEES/OFFICERS

Sec. 23. The board of directors or trustees. - Unless otherwise provided in this Code, the corporate

powers of all corporations formed under this Code shall be exercised, all business conducted and all

property of such corporations controlled and held by the board of directors or trustees to be elected

from among the holders of stocks, or where there is no stock, from among the members of the

corporation, who shall hold office for one (1) year until their successors are elected and qualified.

Every director must own at least one (1) share of the capital stock of the corporation of which he is a

director, which share shall stand in his name on the books of the corporation. Any director who ceases

to be the owner of at least one (1) share of the capital stock of the corporation of which he is a director

shall thereby cease to be a director. Trustees of non-stock corporations must be members thereof. A

majority of the directors or trustees of all corporations organized under this Code must be residents of

the Philippines.

Articles of

Incorporation

Corporation Code

of the

Philippines

By-Laws

ARTICLE IV

BOARD DIRECTORS

Section 2. The Board of Directors shall consist of 11 members, which may be changed to an

odd number not fewer than five not more than 15 by resolution of the Board of Directors in

accordance with law. The 11 members of the Board shall consist of five A Directors and one

independent director nominated by Stockholder A, and four B Directors and one independent

director nominated by Stockholder B. No reduction in the number of directors may be made unless

corresponding vacancies exist a s result of deaths, resignations, expiration of terms of office, or

other actions provided by these By-Laws.


Duties and Responsibilities of the Board

MANUAL OF CORPORATE GOVERNANCE

In fulfilling its mission, the duties and responsibilities of BPLAC Board of Directors include, but are not limited to, the following:

• Review and approve strategic and business plans, including operating and capital plans of the Company.

• Oversee the conduct of BPLAC’s business to ensure that it is properly managed, and its dealings with policyholders, claimants, and creditors are fair and equitable.

• Identify principal business risks and ensure the implementation of appropriate risk management system to specifically manage the underwriting, reinsurance, investment, financial, and operational risks of the Company.

• Approve corporate policies in core areas of operations, specifically underwriting, investments, reinsurance, and claims management.

• Develop and implement an investor relations program or adopt shareholder communications policy for BPLAC.

• Review the adequacy and the integrity of BPLAC’s internal control systems and management information systems including systems for compliance with the Insurance Code and other applicable laws, regulations, rules, directives, and guidelines.

• Declare Policyholders dividends.

• Elect Director/s to fill vacancies on the Board.

• Elect BPLAC’s Chairman of the Board and its Chief Executive Officer

• Plan for the succession of the BPLAC Chairman of the Board and the Chief Executive Officer

• Determine compensation for Non-employee Directors.

• Select and appoint officers who are qualified to administer insurance affairs soundly and effectively, and establish an adequate selection process for all personnel.

• Apply fit and proper standards on personnel who must have integrity, technical expertise, and experience in the institution’s business, either current or planned, which is the key consideration in the selection process.

• Establish an appropriate personnel compensation package that is consistent with the interest of all its stakeholders.

• Review and approve material transactions not in the Company’s ordinary course of business.

• Establish a system of check and balance which applies to the Board and its members.

• Have an appropriate reporting system so that the Board can monitor assess and control the performance of Management.

• Present to all its members and shareholders a balanced and understandable assessment of the Company’s performance and financial conditions.

• Appoint a Compliance Officer who shall be responsible for coordinating, monitoring, and facilitating compliance with existing laws, rules and regulations.

• Engage the services of a Corporate Secretary who must ensure that all appointments are properly made, that all necessary information are obtained from the directors, both for the Company’s own records and for the purposes of meetings statutory obligations, as well as obligations arising from the requirements of the Insurance Commission and other regulatory agencies.

• Approve the Charter, By-laws, Directors Rules and Regulations, Corporate Governance Guidelines, Code of Business Conduct and Ethics, and other corporate governance documents, as may be appropriate, and any amendments thereto, and ensure the fulfillment of all duties and responsibilities set forth therein.

• Such other duties and responsibilities as may be required by applicable law or regulation or Company policy or any other matter over which the Board has authority.


Qualifications and Disqualification of a Director


Qualifications and Disqualification of a Director (cont’d)






Kinds of Directors

Executive Director

Refers to a director who is at the same time appointed to hea d a department/unit within the corporate organization.

Non-Executive Director

Refers to a Board member with non-executive functions.

Independent

Non- Executive Director

Refers to a person other than an officer or employee of the corporation, its parent or subsidiaries, or any other individual having any relationship with the corporation, which could interfere with the exercise of independent judgment in carrying out the responsibilities of a director. This means that apart from the director’s fees and shareholdings, he should be independent of management and free from any business or other relationship that could materially interfere with the exercise of his independent judgment.


Board Balance and Independence


PART III

BOARD COMMITTEES


Constitution Terms of Reference

Audit & RPT Committee

Audit & RPT Committee

Description/Background

The Audit and RPT Committee is authorized by the Board

to investigate any activity within the Terms of Reference

and to seek any information it requires from any

employees and all employees are directed to co-operate

with any request made by the Audit and RPT Committee.

Composition

• Jesse Ang (Chair)

• Jesus P. Tambunting

• Kelvin Ang

Frequency Quarterly


Constitution Charter

Governance, Compensation

and Nomination Committee

Governance, Compensation and

Nomination Committee


The Committee shall assist the Bplac Board of Directors in

ensuring compliance with and proper observance of corporate

governance principles and practices. The Committee shall also

ensure the observance of the nomination and compensation

policies and functions of the Board. In furtherance of this purpose

Bplac Governance, Nomination and Compensation Committee

shall have the following responsibilities and authority:

Composition

• Kelvin Ang (Chair)


• Cezar P. Consing

Frequency Twice a year



Board Risk Committee

Board Risk Committee


The Board has, among other things, the responsibility to determine the Risk

Appetite, the Risk Management Statement and the Risk Management Framework.

The Board Risk committee shall provide advice to and assist the Board in reviewing

and recommending the Risk Appetite, the Risk Management Statement and the

Risk Management Framework. The Board Risk Committee shall approve the Risk

Measurement Systems and Metrics.

The BRC shall be composed of five (5) members, one (1) of whom shall act as

Chairperson. The Chairperson is preferred to be an independent director or a non-

executive director. At least one (1) member will be an independent director. If the

Chairperson is not present at a meeting the BRC may appoint an Acting

Chairperson.

Composition

• Cezar P. Consing (Chair)


• Surendra Menon

Frequency Quarterly


Executive Committee

Executive Committee


Such Committee shall have and may exercise all the powers of the

Board of Directors during the interval between meetings, which may be

lawfully delegated, subject to such limitations as may be provided by

resolution of the Board. Of Directors.

Composition • Kelvin Ang (Chair)

• Cezar P. Consing (Vice-Chair)

• Surendra Menon

• Consuelo A. Lukban (as alternate for Mr. Consing)

Frequency On Call

Constitution Article V, Section 1 of the By-Laws



Investments Committee

Investments Committee


Such Committee shall have and may exercise all the powers of the

Board of Directors concerning investments during the interval between

its meetings, which may be lawfully delegated, subject to such

limitations as may be provided by the Board.

Composition

• Arleen May S. Guevara (Chair)

• Surendra Menon

• Consuelo A. Lukban

• Spencer T. Yap

• Joseph G. De Dios

Frequency Quarterly


PART IV

REPORTORIAL REQUIREMENTS

FOR DIRECTORS


INSURANCE COMMISSION (IC)Report/Document Filing Period In Compliance with Required Form(s)

1Resumewithin 30 days upon election/appointment

Fit and proper requirements of 187 of the Insurance Code

2Biographical Data Certificationwithin 30 days upon election/appointment

IC Circular Letter No. 35-2006

3Certificate of Attendance on Corporate Governance Seminar

within the first six (6) months of their assumption to office and with the corresponding proof of compliance

IC Circular Letter No. 12-2004(to be issued by the accredited

training institution)

SECURITIES AND EXCHANGE COMMISSION (SEC)Report/Document Filing Period In Compliance with Required Form(s)

1Certification of Independent Directorswithin 30 days upon election/appointment

Section 38 of the Securities Regulation Code (SRC)

OFFICE OF THE CORPORATE SECRETARYReport/Document Filing Period Required Form(s)

1Declaration of Trust and Indemnity Undertaking

within 30 days upon election/appointment

2Assignment Separate from Certificate upon issuance of stock certificate

3DOSRI Annual Certification annual (every January)

4Data Privacy Consent Formwithin 30 days upon election/appointment


PART V

DIRECTORS AND OFFICERS LIABILITY INSURANCE

COVERAGE SUMMARY


Scope of Coverage


Coverage Limits

Summary of key D&O Liability Insurance covers:

Type of Policy

Coverage

Limit

D&O Liability Insurance

Total aggregate for all Loss, arising out of all Claims and Investigations under all Insuring Agreements combined (including Defense Costs and Legal Representation Expenses).

US$ 25 M

Coverage

Limit

Insuring Agreement B and Indemnifiable

Loss

(i) Claims falling under the jurisdiction of the courts in the United States

of America or settled by compromise in the United State of America: (a) alleging violation of any of the provisions of the Securities Act of

1993, the Securities Exchange Act 1934 or any similar federal or state law or any common law relating thereto:

(b) alleging an Employment Related Wrongful Act: (c) for all other Claims:

(ii) Claims falling anywhere in the world other than the United States of America: (a) Alleging violation of any securities laws or provisions common or

statutory; (b) Alleging an Employment Related Wrongful Act: (c) For all other Claims:

US$ 250,000.00

US$ 250,000.00

US$ 250,000.00 US$ 250,000.00

US$ 50,000.00

US$ 50,000.00 US$ 50,000.00

Insuring Agreement C

(i) Investigations falling under the jurisdiction of the courts in the United

States of America or settled by compromise in the United States of America;

(ii) Investigations falling anywhere in the world other than the United States of America:

US$ 250,000.00

US$ 250,000.00


Who is Covered?


Exclusions

Documents

Directors’ Handbook - BPI-Philam · 2019-06-14 · BPI-Philam confidential and proprietary information. Not for distribution. About AIA About AIA AIA Group Limited and its subsidiaries