SOP Library
SOP NO:
HR-PB22
(List of Exhibits/Attachments)
Missi
on
:
Finance and Administration
Area:
Human Resource (HR)
Activity:
Personnel Benefits and Services (HR-PB)
Title:
PNB Salary Loan Program
Date Approved/Issued:
08/18/1993
Date Effective:
08/18/1993
Digest:
I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis
II. IMPLEMENTING GUIDELINES
A.
MEMORANDUM OF AGREEMENT
The National Food Authority has been accredited to avail of the PNB Salary Loan Program for its employees per approved application for accreditation. For purposes of collection through payroll deduction, a Memorandum of Agreement shall be entered into by and between the respective NFA offices and the counterpart PNB branch office. Regional offices and Provincial offices located in regional seats shall be covered by only one MOA in which case the Regional Director shall be the authorized signatory in behalf of NFA.
Annex A presents the pro-forma Memorandum of Agreement.
B.
FILING & PROCESSING OF APPLICATION
Applicsations for central/regional/provincial office employees shall be forwarded to the DMS-HRMD/AO IV/AO III, for pre-processisng (i.e. check completeness sof requirements and qualification of borrower and co-maker). Pre-processed applications shall be endorsed to the designated PNB branch office by the respective heads of offices for field offices and the Division Chief, DMS-HRMD for Central Office.
C.
ELIGIBILITY OF BORROWERS & CO-MAKERS
1.
Borrower
Any NFA employees who passes the following requirements can avail of the PNB Salary Loan:
a. He/she must be a permanent regular employee with at least 2 years of service in NFA;
b. He/she must have no pending administrative charges, filed against him/her.
c. He/she must have at least 30 days unespended vacation and/or sick leave credits;
d. He/she must have no pending application for retirement or must not be due for retirement within the term of the loan;
e. He/she must be up-to-date in the payment of his/her existing PNB Salary Loan, if any;
f. He/she must have a monthly net take home pay of not less than P1,000 after deducting all statutory deductions and the monthly amortization of this PNB Salary Loan and other loans.
2.
Borrower
Any NFA employee who passes the following requirements can avail of the PNB Salary Loan:
a. He/she must be a permanent regular employee with at least 2 years of service in NFA ;
b. He/she must have no pending administrative charges, filed agsinst him/her;
c. He/she must have at least 30 days unexpected vacation and/or sick leave credits;
d. He/she must have no pending appliction for retirement or must not be due for retirement within the term of the loan;
e. He/she must be up-to-date in the payment of his/her existing PNB Salary Loan, if any;
f. He/she must have a monthly net take home pay of not less than P1,000 after deducting all statutory deductions and the monthly amortization of this PNB Salary Loan and other loans.
2.
Co-Maker
An employee-borrower can choose any one or two NFA as co-makers. They should pass the above requirements (except C.1f) in addition to the following requirements:
a. He/she must have a monthly net take home pay of not less than P1,000;
b. One co-maker's/two co-makers combined rank/salary grade should be higher, or at least equal to that of the borrower's;
c. He/she must not have previously acted as co-maker to any PNB Salary Loan borrower unless that previous loan has been fully paid;
d. He/she must be assigned in the same office as that of the borrower's;
e. He/she should not be a spouse of the borrower.
3. However, the co-maker requirement may be waived, subjct to approval of PNB, if: 1) the borrower is one of the co-signatories of the MOA or is the one certifying the eligibility of the borrower and co-makers, and 2) if the borrower's responsibility and financial capacity are unquestionable as evidence by his/her latest Income Tax Return.
D.
LOANABALE AMOUNT
Borrowers can avail of up to three (3) times his/her monthly basic salary, provided that his/her monthly net take home pay shall not be less than P1000 after deducting all statutory deductions and the amortization to this salary loan and other loans.
E.
APPROVAL
1. The Chief, DMS-HRMD (C.O.)/Prov'l Manager (P.O.)/Regional Manager (R.O.) shall sign the Certification portion of the application (Exhibit 1). In line with this,t he nFA shall submit specimen signature of authorized signatories to the PNV counterpart.
2. PNB shall approve all applications for the PNB Salary Loan.
3. DMS-HRMD/AO IV/AO III shall coordinate with the PNB branch office regarding the approval/disapproval of the loan applications.
4. Approved loans shall be credited to the PNB bank account of the borrower and shall only be available for withdrawal after the borrower signs the
Loan Release/Renewal Sheet and Disclosure Statement
(Exhibit 2 and 3).
5. DMS-HRMD/AO IV/AO III shall request from PNB the
notice of approval
(Exhibit 4) together with the report on
Loan Releases for the day
(Exhibit 5) for monitoring purposes. In case of disapproval, a
notice of disapproval
(Exhibit 6) shall be forwarded.
F.
TERMS OF PAYMENT
1. Loans equivalent to one month or two to three months basic salary shall be payable within one year or two year's respectively.
2. Interest rate shall be 14% per annum, collected in advance for the first year, and in arrears for the second year.
3. Loans shall be payable in equal amortizations through salary deduction, and shall commence on the month immeidately succeeding the month the loan was granted.
4. DAB-Fin. Sec. and DMS/AO IV III shall request for a copy of the
Report on Loans for Deduction
(Exhibit 7) from PNB on or before the end of each month. In the case of Central Office, PNB shall be requested to provide Management Services Department with a copy of the
Report on Loans for Deduction
for data entry purposes and DAB/Finance SEction with a
Loan Release/Renewal Sheet and Disclosure Statement
for monitoring purposes (Exhibit 2 and 3).
5. A penalty of 3% per month shalll be charged for delayed payments. On a case to case basis, the penalty may be waived on justifiable grounds such as :
a. death of the borrower;
b. dismisssal/separation from the service
c. impairment of paying capacity due to natural calamities
6. In case of non-deduction, the borrower could pay the collecting officer on or before the end of the month and furnish DAB/Finance Section with a copy of the Official Receipt.
G.
REMITTANCE OF PAYMENT
1. For purposes of salary deductions and remittance of payment, the NFA office shall request PNB for a Monthly Statement of Account containing the following information:
Name of borrowers
Amount of Loan
Amortization for the month
Outstanding balance - principal and interest
Penalties (if any)
Other information needed by the NFA office
2. DAB/Finance Section shall remit monthly the loan amortizastions through checks payable to the designated PNB local branch on or before the 3rd banking day of every month. A
statement of remittances
(Exhibit 8) shall be submitted together with loan amortizations.
3. Penalties due to delayed remittances shall be shouldered by whoever shall be established to have caused the delay.
H.
TRANSFER OF ASSIGNMENT
1. If the borrower is transferred to another office and no longer receives his/her salary from the office where he/she is formerly assigned, his./her account shall be transferred to the PNB branch designated for the destination office. DMS/AO IV/AO III of the source province shall inform their local PNB of the transfer and instruct the DAB/Finance Section of the destination office to deduct payment from the salary of the borrower.
2. The destination office shall indicate in their
remittance of amortizations
(Exhibit 8) that the borrower is a transferee from a specific office.
The borrower shall also ensure that DAB/Finance Section of his destination deducts payment for his PNB Salary Loan.
I.
SEPARATION FROM NFA
1. If the borrower is separated or terminated from NFA, the outstanding loan balance shall become due and demandable. DMS/AO IV/AO III shall notify PNB of the separation or termination. PNB, in turn, shall issue a clearance certifying that the loan has been fully settled. If the loan is not yet fully settled, a statement of acounts shall be issued.
The remaining loan balance could be deducted from the benefits the borrower would receive from NFA. If this is insufficient, the borrower shall be required to pay the remaining loan balance with DTFM/Collecting Officer. If this is still not possible, the remaining loan balance shall be automatically deducted/claimed from the co-maker.
2. If only the co-maker is separated from NFA, DMS-HRMD/AO IV/AO III shall instruct the borrower to replace the co-maker withanother qualified co-maker using the co-maker
Replacement Sheet
(Exhibit 9).
J.
REAVAILMENT
A borrower can re-apply for PNB Salary Loan after payment of at least nine monthly amortizations (for loans equivalent to one month basic salary) or 18 monthly amortizations (for loans equivalent to twoor three times the monthly basic salary).
K.
SUSPENSION AND RESTORATION OF GRANTING OF LOANS
Granting of loans shall be suspended on a particular NFA office (particular MOA) if the past due ratio for all loans reaches 10% of total outstanding salary loans granted. If shall be automatically restored if the ratio falls below the 10% suspension benchmark.
a. Fully accomplished Application form;
b. Xerox copies of the borrower's & co-maker's payslips for the last 2 months immediately preceeding the loan application (certified by the DAB/Finance Section).
c. Certificate of No Pending Case
d. Certificate of Lease Credit (Exhibit 10) from the DMS/EA I /AO IV/AO III noted by the Department Manager/PM/RM concerned
e. Individual Statement of PNB Salary Loan Remittances for renewals
f. If the co-masker requirement has been waived, a certified true copy of his latest Income Tax Return.
H.
ACCOUNTING ENTRIES
1. Upon deduction of the monthly amortization from salaries and allowances:
DR Salaries xxx
DR Allowances xxx
CR TL-employees Character
Loan PNB (8-84-900.27) xxx
CR Vouchers Payable xxx
2. Upon remittance of the monthly amortization to PNB:
DR TL-Employees' Character xxx
Loan PNB (8-84-900.27)
CR Vouchers Payable xxx
DR Vouchers Payable xxx
CR Cash in Bank xxx
III. RESPONSIBILITIES
IV. FLOW CHART
Top Page
EXHIBITS
All Purpose Salary Loan System
Application for PNB All-Purpose Salary Loan
Loan Releases for the Day
PNB Returned Application Form
Exhibit 7
All Purpose Salary Loan System
Salary Loan Program