COVER SHEET 1 5 5 5 2 SEC Registration Number P H I L I P P I N E S A V I N G S B A N K (Company’s Full Name) P S B a n k C e n t e r , 7 7 7 P a s e o d e R o x a s c o r n e r S e d e ñ o S t r e e t , M a k a t i C i t y (Business Address: No. Street City/Town/Province) MARIA AILEEN A. VILLARAMA 8885-8208 Local 1921 (Contact Person) (Company Telephone Number) 1 2 3 1 I A C G R 0 5 2 7 Month Day (Form Type) Month Day (Fiscal Year) (Annual Meeting) (Secondary License Type, If Applicable) Corporate Governance & Finance Dept. Dept. Requiring this Doc. Amended Articles Number/Section Total Amount of Borrowings 1,455 Total No. of Stockholders Domestic Foreign As of 30-Jun-2020 To be accomplished by SEC Personnel concerned File Number LCU Document ID Cashier SEC FORM – I-ACGR INTEGRATED ANNUAL CORPORATE GOVERNANCE REPORT 1. For the fiscal year ended : December 31, 2019 2. SEC Identification Number : 15552 3. BIR Tax Identification No. : 000-663- 983-000 4. Exact name of issuer as specified in its charter : PHILIPPINE SAVINGS BANK 5. City of Manila, Philippines 6. (SEC Use Only) Province, Country or other Industry Classification Code: jurisdiction of incorporation or organization 7. PSBank Center, 777 Paseo de Roxas cor. Sedeño St., Makati City 1225 Address of principal office Postal Code 8. (632) 8885-8208 Issuer's telephone number, including area code 9. Not applicable Former name, former address, and former fiscal year, if changed since last report. SEC Form – I-ACGR * Updated 21Dec2017 Page 2 of 117 INTEGRATED ANNUAL CORPORATE GOVERNANCE REPORT COMPLIANT/ ADDITIONAL INFORMATION EXPLANATION NON-COMPLIANT The Board’s Governance Responsibilities Principle 1: The company should be headed by a competent, working board to foster the long-term success of the corporation, and to sustain its competitiveness and profitability in a manner consistent with its corporate objectives and the long- term best interests of its shareholders and other stakeholders. Recommendation 1.1 1. The Board should be composed of directors COMPLIANT At the end of 2019, there are nine (9) directors in our Board, four (4) of whom with collective working knowledge, are independent directors, four (4) are non-executive directors, and one (1) is experience or expertise that is relevant to an executive director, who is also the President of the Bank. They are all the company’s industry/sector. qualified business professionals with the required expertise and experience in directing our strategic path. These directors were selected based on their qualifications (i.e., integrity/probity, physical/mental fitness, competence, relevant education/financial literacy/training, diligence and knowledge/experience) without discrimination on gender, age, and ethnic, political, religious, or cultural backgrounds, hence, achieving diversity in the Board. 2019 Annual Report – Corporate Governance-Board Oversight, page 36 2019 Annual Report – Board of Directors, page 48 Corporate Governance Manual – Composition of the Board, page 7 Corporate Governance Manual – Qualifications of a Director, page 20 Corporate Website – Board of Directors* PSBank Definitive Information Statement for April 15, 2019 ASM, Item No. 5 Directors and Executive Officers, page 10 *The same set of directors were re-elected in the ASM held on May 27, 2020. This document was downloaded from www.psbank.com.ph Duplication and reproduction is allowed. Please do not modify its content. Document Classification: PUBLIC 2. Board has an appropriate mix of COMPLIANT The members of the Board are all qualified business professionals with the competence and expertise required expertise and experience in directing our strategic path. These directors were selected based on their qualifications (i.e., integrity/probity, physical/mental fitness, competence, relevant education/financial literacy/training, diligence and knowledge/experience) without discrimination on gender, age, and ethnic, political, religious, or cultural backgrounds. 2019 Annual Report – Corporate Governance-Board Oversight, page 36 Corporate Governance Manual – Qualifications of a Director, page 20 Corporate Website – Board of Directors* PSBank Definitive Information Statement for April 15, 2019 ASM, Item No. 5 Directors and Executive Officers, page 10 *The same set of directors were re-elected in the ASM held on May 27, 2020. 3. Directors remained qualified for their COMPLIANT Our Corporate Governance Manual states that “he shall maintain his positions individually and collectively to professional integrity and continuously seek to enhance his skills, knowledge enable them to fulfill their roles and and understanding of the activities that the Bank is engaged in or intends to responsibilities and respond to the needs of pursue as well as the developments in the banking industry including the organization. regulatory changes through continuing education or training.” Corporate Governance Manual – Specific Duties and Responsibilities of a Director, page 33-35 2019 Annual Report – Corporate Governance-Board Oversight, page 35 This document was downloaded from www.psbank.com.ph Duplication and reproduction is allowed. Please do not modify its content. Document Classification: PUBLIC Recommendation 1.2 1. Board is composed majority of non- COMPLIANT Of the Bank’s nine (9) directors, eight (8) are non-executive, to wit: executive directors 2019 Directors Type Chairman Jose T. Pardo Non-executive (Independent) Vice-Chairman Arthur V. Ty Non-executive Vice-Chairman Vicente R. Cuna, Jr. Non-executive Jose Vicente L. Alde Executive (President) Samson C. Lim Non-executive (Independent) Benedicto Jose R. Arcinas Non-executive (Independent) Eduardo A. Sahagun Non-executive (Independent) Ma. Soledad D.S. De Leon Non-executive Rosanna F. De Vera Non-executive Corporate Governance Manual – Composition of the Board, page 7 2019 Annual Report – Corporate Governance-Board Oversight, page 35 Corporate Website – Board of Directors* PSBank Definitive Information Statement for April 15, 2019 ASM, Item No. 5 Directors and Executive Officers, page 10 *The same set of directors were re-elected in the ASM held on May 27, 2020. Recommendation 1.3 1. Company provides in its Board Charter and COMPLIANT Our Corporate Governance Manual states that “The Board as a group and as Manual on Corporate Governance a policy on individual directors should have sufficient knowledge relevant to the Bank’s training of directors activities to provide effective governance and oversight. The Corporate Governance Committee (CGC) is mandated, among others, to make recommendations to the Board regarding the continuing education of directors. This document was downloaded from www.psbank.com.ph Duplication and reproduction is allowed. Please do not modify its content. Document Classification: PUBLIC In this regard, the Chief Compliance Officer (CCO) shall liaise with internal and/or external training providers for the training and seminars of directors. Unless otherwise exempted by existing regulations, all Directors and Key Officers are required to attend for a minimum of four (4) hours of training every year, a program on Corporate Governance conducted by training providers duly accredited by the SEC or through an SEC-approved in-house corporate governance training, covering all the mandated topics including financial reporting and auditing. Key Officers, for purposes of this requirement, refer to all officers with the rank of Senior Vice President (SVP) & up (Principal Officers) and those officers named in the Bank’s By-Laws, the Chief Audit Executive (CAE) and the Chief Compliance Officer (CCO).” Corporate Governance Manual – Orientation and Continuing Education, page 35 2019 Annual Report – Corporate Governance-Board Oversight, page 35 2. Company has an orientation program for COMPLIANT Our Corporate Governance Manual states that “It is critical that new directors first time directors. receive the training they need in order to be an effective member of the Board and help lead the Bank in the right direction. The Bank shall furnish all its first- time directors with a copy of the general responsibility and specific duties and responsibilities of the Board of Directors and of a director. The Bank must keep on file and submit the said Certification under oath of the directors concerned that they have received copies of such general responsibility and specific duties and responsibilities and that they fully understand and accept the same. They shall also attend a CG seminar re: Orientation Program for 1st-time Directors to be conducted by SEC and BSP-accredited training providers which should be held for at least eight (8) hours. The Bank shall keep on file and submit the certification to the appropriate department of the BSP-Supervision and Examination Sector, together with a copy of Certificate of Attendance in said Corporate Governance (CG) seminar.” However, the new set of Board of Directors elected during the Annual This document was downloaded from www.psbank.com.ph Duplication and reproduction is allowed. Please do not modify its content. Document Classification: PUBLIC Stockholders’ Meeting held on April 15, 2019 did not have first time directors as all incumbent directors were reelected. Corporate Governance Manual – Orientation and Continuing Education- Orientation for First-Time Director, page 35 3. Company has relevant annual continuing COMPLIANT Together with our principal officers, our directors attended in 2019, an annual training for all directors refresher program on Corporate Governance