Effective internal controls are the foundation of safe and sound banking. Our robust internal control system enables us to safeguard the Bank’s resources, produce timely and accurate financial reports, comply with laws and regulations, reduce the possibility of significant errors and irregularities, and implement management policies to attain corporate goals.
The Board is responsible for the establishment and review of China Bank’s system of internal controls, while the day-to-day responsibility for internal control rests with Management. All of our employees are involved to a certain degree in our internal control process.
Compliance is firmly embedded in China Bank’s culture. We are committed to comply with all applicable laws and regulations to strengthen our business and maintain the trust and confidence of our stakeholders. Our compliance system, built upon a solid foundation of ethical values, fosters a strong compliance culture that starts from the Board and permeates across the organization.
At the forefront of our compliance system is the Compliance Division, which is independent of China Bank’s business activities. The Compliance Division plays an important role in driving the effective management of compliance risks and in promoting compliance awareness and understanding of compliance issues and the impact of non-compliance. It is headed by the Chief Compliance Officer (CCO), Atty. Aileen Paulette S. De Jesus, who also takes on the role of Group Compliance Officer for the China Bank Group. The CCO is independent from management and reports functionally to the Compliance and the Corporate Governance committees, and administratively to the President.
The Compliance function is supported by the collaborative efforts of Regulatory Compliance, Corporate Governance, IT Compliance, and Anti-Money Laundering units, and the Associated Person. Compliance Coordinators are also designated in each Bank unit to ensure that all risks associated to the operations and business of the individual units are identified, monitored, and mitigated.
Internal Audit performs a significant role in corporate governance by providing assurance and insights on the processes and structures that propel China Bank towards success. For assurance, it involves the assessment and reporting on the adequacy, efficiency, and effectiveness of governance, risk management, and control processes designed to help us achieve our goals and objectives. Internal Audit’s insights on governance, risk, and control produce positive change and improvement within the Bank.
Our Audit Division is headed by the Chief Audit Executive (CAE), Mr. Ronald R. Marcaida. It is independent from undue influence as evidenced by the functional and administrative reporting to the Audit Committee and the President, respectively. It has a Board-approved Internal Audit Charter which defines its purpose, authority, and responsibility, among others. The auditors are competent, objective, and avoid conflicts of interest in the performance of their responsibilities. These attributes put the group to be in the best position to render assurance services on governance, risk management, and internal control processes.
To ensure excellent and value adding audit services, our Audit Division continuously improves existing practices and our internal auditors regularly attend trainings/seminars to enhance their skills and competencies and remain on top of industry developments.
China Bank’s resilience is anchored on prudent risk-taking. We safeguard stakeholders’ interest and the Group’s assets with a balanced approach to risk management, undertaking only well considered risks for commensurate returns. Our Risk Management Group (RMG), headed by Chief Risk Officer Ananias S. Cornelio III, executes the risk management function which is generally responsible for identifying, assessing, monitoring, and mitigating our key risks. RMG reports to the Board through the Risk Oversight Committee which has approval and oversight responsibility for our risk management framework and risk appetite. Risk identification and assessment are embedded in our control processes, employees at all levels are responsible for the management and reporting of risks, and risk management is reinforced as a discipline group-wide through trainings and communication.