The Philippine Securities and Exchange Commission is consulting on a complete rewrite of Rule 48.1 of the Securities Regulation Code implementing rules, replacing the existing margin regime with a principles-based, risk-sensitive framework for broker-dealer financing. The proposal gives concrete form to the commission’s recently identified margin-trading review and broader efforts to improve market liquidity while strengthening credit controls, investor protection and regulatory oversight. During the transition, authorized broker-dealers would need at least PHP 150 million in unimpaired paid-up capital, adequate operational and risk-management capabilities, and no major exchange-rule penalties during the preceding two years. Margin financing would generally be limited to equities in the Philippine Stock Exchange Composite Index or MSCI Philippines Index, unless the exchange designates others. Credit could not exceed 60% of a security’s market value, customers would need at least PHP 50,000 of account equity before receiving new or increased financing, and equity would have to remain at or above 30%. Customers would generally have three trading days to meet margin calls, after which brokers could liquidate collateral, while retaining authority to impose stricter house requirements. The commission would set minimum prudential standards and retain oversight, while the exchange would establish the operational rules and risk-sensitive methodology, subject to commission approval. The Capital Markets Integrity Corporation would supervise and enforce broker-dealer compliance. If the amendments take effect, the exchange would have 90 calendar days to submit implementing margin-trading rules, including standards for customer suitability, collateral, margin calls, reporting, governance and technology controls. Existing accounts could continue under their current agreements, but new financing and increases to existing accounts would have to meet the revised transitional requirements.
2026-08-26Philippine Securities and Exchange Commission
Philippine Securities and Exchange Commission launches consultation on risk-sensitive margin financing framework
The Philippine Securities and Exchange Commission has proposed a risk-sensitive margin financing framework for broker-dealers, with detailed rules to be developed by the Philippine Stock Exchange. Transitional standards include PHP 150 million in broker-dealer capital, a 60% maximum credit ratio, a 30% maintenance margin and PHP 50,000 in minimum customer equity for new or increased financing. Margin calls would generally have to be met within three trading days.