September 24, 2009

Mr. Felino C. Ablat, Jr.

General Manager
Coop Bank of Surigao del Sur
Poblacion, Bislig City

Dear Mr. Ablat :

Please be informed that LBP’s Matured Equity Investment with your bank is
eligible under the Rehabilitation (Risk Recovery) Program of LBP. Features of
which are attached herewith as your reference.

In this connection, may we request you to submit the following documentary

requirements, to wit:

1. SEC approval on the amendment or addendum in the CFI’s Articles of

Incorporation such as increase in authorized capitalization to
accommodate the new equity investment, change in the features of
equity investment, terms and conditions of redeemable preferred
shares; and provision indicating dividend rate for equity investments;

To facilitate processing of application for conversion with LBP, a copy

of the Certificate of Authority issued for BSP for the amendment of the
CFI’s Articles of Incorporation submitted to and duly received by BSP
can be initially presented meantime that the approval of the proposed
amendment is being sought.

2. BSP approval of the following:

Rehab plan for participating CFI’s blue print of activities that will
address liquidity and solvency problems and to put the CFI in a
viable and operating in case of major investment, merger or
consolidation.
Other regulatory requirements to effect the equity conversion
scheme.

3. Board Resolution effecting the transfer of the sinking fund contribution

plus accrued interest to LBP to settle partially or in full the outstanding
investment and unpaid dividends, if any.

4. Letter of Intent to apply for conversion into a new equity investment

facility.

5. Board resolution authorizing the CFI to apply under the risk recovery
program, submit documents and designating officers authorized to
sign all pertinent documents with specimen signature, and effecting
the redemption of preferred shares and automatic application of the
sinking fund for the matured investment, upon maturity of the equity
investment.

6. List of major stockholders and their stockholdings with bio-data.

7. List of Directors and Key Officers with bio-data.

 8. Financial statements for the last three years including current interim
financial statement.

9. Three-year business plan and capital build-up program.

10. Memorandum of Agreement (MOA) between LBP and CFI on the

new equity infusion program, and Escrow Agreement for the
establishment of sinking fund.

11. Copy of the latest BSP examination report and the CFI’s reply.

12. Copy of CFI application for declaration of dividends, duly

received by BSP, or BSP approval for dividend declaration or plan of
payment approved by BSP if the CFI is not allowed to declare
dividends.

Thank you.

Very truly yours,

CHARLOTTE I. CONDE
Head, Davao LC

MEMORANDUM

FOR : HERMEO G. BAUTISTA

ACTING HEAD, PMD I

FROM : CHARLOTTE I. CONDE

HEAD, DAVAo LENDING CENTER

SUBJECT : COOPERATIVE BANK OF DAVAO DEL SUR

DATE : DECEMBER 22, 2008

This refers to LBP’s Equity Invesment with the subject coop bank
with details as follows:

 Amount - P1.00 M
 Program - Presidential Directive 1981
 Date of Infusion - August 31, 1991
 Date of Maturity - August 31, 2003
 O/S Balance - P1.00 m

The coop bank thru its resolution no. 2008-006 and 2007, series
of 2008, requested for the condonation of accumulated dividends and
conversion of matured equity investment into common stock equity
citing provision 6.7 of the Memorandum of Agreement for the said
equity investment.

In this connection, may we inquire if the request of the subject

cooperative is eligible for conversion into common stock equity taking
into consideration the Risk Recovery Program for CFIs with
Outstanding Matured Equity Investments.

For your appropriate action, please.

Charlotte I. Conde

MEMORANDUM

FOR : HERMEO G. BAUTISTA

ACTING HEAD, PMD I

FROM : CHARLOTTE I. CONDE

HEAD, DAVAo LENDING CENTER
SUBJECT : COOPERATIVE BANK OF DAVAO DEL SUR

DATE : MARCH 12, 2009

This a follow-up of our previous memorandum dated 22

December 2008 inquiring if the request of the subject cooperative is
eligible for conversion into common stock equity taking into
consideration the Risk Recovery Program for CFIs with Outstanding
Matured Equity Investments.

For your appropriate action, please.

Charlotte I. Conde