The Philippine Insurance Commission issued a circular allowing insurance companies to participate in securities borrowing and lending, or SBL, transactions, Asia Insurance Review reported.
The total allowed investments should not exceed 5% of the total admitted assets for life insurers and 10% of the total net worth for nonlife insurers and reinsurers, based on the companies' latest approved annual statement.
Securities listed in the Philippine Stock Exchange and Philippine Dealing Exchange and securities issued by the Bureau of Treasury and the Bangko Sentral ng Pilipinas are eligible for the SBL transactions, which may be conducted through direct lending, lending agent, lending pool system and other schemes subject to the approval of the commission, according to the circular.
Insurers and reinsurers may accept collateral in the form of peso-denominated cash, commercial bank-issued irrevocable and negotiable letters of credit, government-issued bonds or other instruments, bonds, debentures or other instruments, PSE-listed securities and any combination thereof or other forms of collateral allowed by the commission, according to the report.
