The Board has established six (6) committees to help in discharging its duties and responsibilities. These committees derive their authority from and report directly to the Board. Their mandates and scopes of responsibilities are set forth in their respective Terms of Reference which are subject to review and update annually or when there are significant changes therein. The number and membership composition of committees could be increased or decreased by the Board as it deems appropriate and consistent with applicable laws or regulations specifically on the majority membership and chairmanship of independent directors in various committees. The standing committees of the Board are as follows:

Executive Committee
Chairperson: Lazaro Jerome C. Guevarra
Members: John Emmanuel M. Lizares, Melanie S. Belen
Functions:

• Acts as the main approving body for Company exposures, particularly approval and confirmation up to its delegated authority of transactions such as but not limited to credit proposals, investment and acquisitions, credit-related issues, property-related proposals, technology-related projects or such other initiatives to enhance the Company’s operating and service delivery capabilities, and operating policies and/or manuals including amendments thereto as may be recommended by management.

Audit Committee
Chairperson: Ismael G. Estela, Jr. (Independent Director)
Members: Ms. Rebecca S. Torres; Luis Ma. G. Uranza (Independent Director)
Functions:
The Audit Committee is empowered by the Board to oversee the financial reporting process, internal control and risk management systems, internal and external audit functions, and compliance with governance policies, applicable laws and regulations. Their oversight function covers the following areas:

• On financial reporting, the committee reviews the integrity of the reporting process to ensure the accuracy and reliability of financial statements and compliance with financial reporting standards and disclosure requirements set for listed companies.
• On internal control and risk management, it monitors and evaluates the adequacy, soundness and effectiveness of the Company’s established internal control and risk management systems, policies and procedures including implementation across all units of the Company to provide reasonable assurance against fraud or other irregularities and material misstatement or loss.
• On internal and external audit, it recommends the appointment, reappointment and removal of the external auditors, remuneration, approval of terms of audit engagement and payment of fees. It reviews non-audit work, if any, ensuring that it would not conflict with their duties as external auditors or may pose a threat to their independence. It approves the annual audit plan and reviews audit results including the BSP Report of Examination focusing on significant findings with financial impact and its resolution. It reviews the implementation of corrective actions to ensure that these are done in a timely manner to address deficiencies, non-compliance with policies, laws and regulations.
• On compliance, it reviews and evaluates the effectiveness of the regulatory compliance framework and governance policies and practices of the Company to ensure that these are consistently applied and observed throughout the institution. In this context, the following were done during the year:

Corporate Governance Committee
Chairperson: Luis Ma. G. Uranza (Independent Director)
Members: Ms. Rebecca S. Torres; Ismael G. Estela, Jr. (Independent Director)
Functions:

• Primarily tasked to assist the Board in formulating the governance policies and overseeing the implementation of the governance practices of the Company as well as its subsidiary.
• Annually, it also conducts a performance evaluation of the Board of Directors, its committees, senior management, peer evaluation of directors, and a self-evaluation of its performance.
• Provides an assessment of the outcome and reports to the Board the final results of the evaluation, including recommendations for improvement and areas to focus to enhance effectiveness.
• Oversees the continuing education program for directors and key officers and proposes relevant trainings for them.

Risk Management Committee
Chairperson: Ms. Rebecca S. Torres
Members: Luis Ma. G. Uranza (Independent Director); Lazaro Jerome C. Guevarra
Functions:

• Responsible for the development of the Company’s risk policies, sets the risk appetite and defines the appropriate strategies for identifying, quantifying, managing and controlling risk exposures including preventing and/or minimizing the impact of losses when they occur.
• Oversees the implementation and review of the risk management plan on an integrated enterprise-wide basis, system of limits of management’s discretionary authority delegated by the Board and takes immediate corrective actions when breached. It is also responsible to reassess the continued relevance, comprehensiveness and effectiveness of the risk management plan and revise it when needed.
• Works with the Audit Committee in certifying in the Annual Report the adequacy of the Company’s internal control and risk management systems.

Nominations Committee
Chairperson: Luis Ma. G. Uranza (Independent Director)
Members: Ms. Rebecca S. Torres; Ismael G. Estela, Jr. (Independent Director)
Functions:

• Leads the process for identifying candidates for election and appointment of Directors and other positions requiring appointment by the Board of Directors, giving full consideration to succession planning and the leadership needs of the Company. In particular, this process includes the profiling of the skills and competencies of the currently serving directors, the gaps in skills and competencies identified and the search for candidates who are aligned with the Company’s directions to fill the gaps.
• Makes recommendations to the Board on the composition and chairmanship of the various committees.
• Keeps under review the structure, size and composition of the Board, including the balance of skills, knowledge and experience and the independence of the non-executive Directors, and makes recommendations to the Board with regard to any changes.

Related Party Transactions Committee
Chairperson: Luis Ma. G. Uranza (Independent Director)
Members: Ma. Ismael G. Estela, Jr. (Independent Director); Geneva T. Gloria
Functions:

• Assists the Board in its oversight of the conduct of all Related Party Transactions (RPTs) to protect the interests of the Company and its stakeholders.
• Ensures proper disclosure of all approved RPTs in accordance with applicable legal and regulatory requirements and confirmation by majority vote on the Annual Stockholders’ meeting the Company’s significant transactions with related parties.

Terms of Reference