Rule 18. The Liquidity Reserve Fund

18.1.  Notwithstanding the provisions of the immediately preceding Rule, no less than ten per cent (10%) of the net value of Trust Fund Assets per type of plan shall be set aside as a Liquidity Reserve to cover the Benefits due to Planholders during the ensuing year unless the Actuary determines otherwise.  For this purpose, the Trustee shall require the issuer to submit a list of fully paid plans payable during the year every beginning of the company’s fiscal year.

The following shall qualify as investments for the Liquidity Reserve Fund:

i.)     Loans secured by a hold-out on, assignment or pledge of deposits maintained either with the trustees or other   banks,  or of deposit substitutes or the trustee itself or  mortgage  and chattel mortgage bonds issued by the trustee;

ii.)    Treasury notes or bills, Central Bank Certificates of Indebtedness which are short-term and other government securities or bonds, and such other evidences of indebtedness or obligations, the servicing and repayment of which are fully guaranteed by the Republic of the Philippines;

iii.)   Repurchase agreements with any of those mentioned above, as underlying instruments thereof;

iv.)   Savings or time deposits with government owned banks or commercial banks; provided, that in no case shall any such savings or time deposit account be accepted or allowed under a “Bearer”, “Numbered Account” or other  similar arrangements;

v.)    Investments in fixed income instruments.