BSP orders conversion of manual titles to e-copies

Manila, Philippines - Banks and other financial institutions have been required by the Bangko Sentral ng Pilipinas (BSP) to convert all their real estate titles to electronic forms to prevent loss of information and counterfeiting.

“In order to reinforce an institution’s risk management system, particularly in ensuring the security and integrity of the titles of its properties, banks and non-bank financial institutions under BSP supervision are advised to avail of the e-Title Program for all its titled properties,” Memorandum M-2012-037 signed on July 27 stated.

According to the memo, the e-Title or Electronic Certificates of Title Program is part of the Land Registration Authority’s (LRA) Land Titling Computerization Project that aims to provide “higher security and reliability on titles issued by the LRA.”

Manual titles of all capital and foreclosed assets owned by BSP-supervised banks and non-bank institutions should be converted to electronic copies, the memorandum said.

This is to ensure that original copies “are protected from loss or destruction due to age, wear and tear, fraud, fire and natural disasters, and misfiling of records.”

The system also makes sure that titles undergo “strict scrutiny” in the Registries of Deeds.

Likewise, banks are also encouraged to convert manual titles of real estate assets that they accepted as loan collaterals.

“The conversion to e-Title will reduce the risk of tampering and destruction and deter substitution or insertion of questionable data which may prejudice such claims,” the memorandum said.

BSP data showed that universal and commercial banks’ exposure to the real estate sector, particularly through extension of real estate loans and investments in real estate firms, rose by nearly a fifth last year to a new record-high of P433.6 billion.

The same banks have non-performing assets – composed of soured loans and foreclosed properties – accounting for 2.77 percent of their total loan portfolio as of April this year.