BY-LAWS

OF
Savings Group Aklan Credit Cooperative (SAGA)

KNOW ALL MEN BY THESE PRESENTS:

We, the undersigned Filipino citizens, of legal age, and residents of

the Philippines, representing at least majority of the members of this
Savings Group Aklan Credit Cooperative (SAGA) , do hereby adopt this By-
laws.

Article I
Purpose/s and Goals

The purpose/s and goals of this Cooperative are those set forth in its
Articles of Cooperation.

Article II
Membership

Section 1. Kinds of Membership. This Cooperative shall have regular members

only.

Regular Members are those who have complied with all the
membership requirements and are entitled to all the rights and privileges
of membership.

Section 2. Qualification for Membership. The membership of this Cooperative

is open to all natural persons, Filipino citizens, of legal age, with capacity
to contract and, within the common bond and field of membership
described as follows:

1.
Regular Members
a.
Residents of the province of Aklan

Section 3. Requirements for Membership. A member must have complied with

the following requirements:

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 1.
Approved application for membership;
2.
Certificate of completion of the prescribed Pre-Membership Education
Seminar (PMES);
3.
Subscribed and paid the required minimum share capital and
membership fee;

Section 4. Application for Membership. An applicant for membership shall

file a duly accomplished form to the Board of Directors who shall act upon
the application within Thirty (30) days from the date of filing. The Board of
Directors shall devise a form for the purpose which shall, aside from the
personal data of applicant, include the duties of a member to participate in
all programs including but not limited to capital build-up and savings
mobilization of the cooperative and, such other information as may be
deemed necessary.

The application form for membership shall include an undertaking

to uphold the By-laws, policies, guidelines, rules and regulations
promulgated by the Board of Directors and the general assembly. No
application for membership shall be given due course if not accompanied
with a membership fee of One Hundred Pesos (Php 100.00), which shall be
refunded to the applicant in case of rejection.

Section 5. Appeal. An applicant whose application was denied by the Board

of Directors may appeal to the General Assembly and the latter’s decision
shall be final. For this purpose, the General Assembly may opt to create an
appeal and Grievance Committee/Membership Committee. The Appeal and
Grievance Committee/ Membership Committee shall decide appeals on
membership application within thirty (30) days upon receipt thereof.

Section 6. Minimum Share Capital Requirement. An applicant for regular

membership shall subscribe at least forty (40) shares and pay the value of
at least ten (10) shares upon approval of his/her membership.

However, no member shall own or hold more than ten percent (10%)
of the total subscribed share capital of the Cooperative.

Section 7. Duties and Responsibilities of a Member. Every member shall have the

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following duties:

a.
Pay the installment of his/her share capital subscription as it falls
due and to participate in the capital build-up and savings
mobilization activities of the Cooperative;
b.
Patronize the Cooperative’s business(es) and services;
c.
Participate in the membership education programs and other
activities and affairs of the Cooperative;
d.
Attend and participate in the deliberation of all matters taken during
General Assembly meetings;
e.
Observe and obey all lawful orders, decisions, rules and regulations
adopted by the Board of Directors and the General Assembly;

Section 8. Rights and Privileges of Members. A member shall have the following
rights and privileges:

Regular Members
a.
Attend general membership meetings;
b.
Avail himself of the services of the Cooperative, subject to
certain conditions as may be prescribed by the Board of
Directors;
c.
Inspect and examine the books of accounts, the audited
financial statements, the minutes books, the share register, and
other records of the Cooperative during reasonable office hours;
d.
Secure copies of Cooperative records/documents pertaining to
the account information of the concerned member;
e.
Participate in the continuing education and other training
programs of the Cooperative; and
f.
Such other rights and privileges as may be granted by the
General Assembly.

Section 9. Members Entitled to Vote. Any regular member who meets the
following conditions is a member entitled to vote:

1.
Paid the membership fee and the value of the minimum shares
required for membership;

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 2.
Not delinquent in the payment of his/her share capital subscriptions
and other accounts or obligations;
3.
Has completed the continuing education program prescribed by the
Board of Directors;
4.
Has participated in the affairs of the Cooperative and patronized its
businesses in accordance with cooperative’s policies and guidelines;
5.
An applicant will be declared official regular member upon payment
of 3,000 in a staggered basis An applicant will be declare official
associate member upon payment of 1,500. As a group, they will
provide a Membership Fee of 5, 000

Failure of the member to meet any of the above conditions shall

mean suspension of voting until the same have been lifted upon the
determination of the Board of Directors.

Consequently, a member entitled to vote shall have the following

additional rights:

a.
Participate and vote on all matters deliberated upon during General
Assembly meetings;
b.
Seek any elective or appointive position, subject to the provisions of
this By-laws and the Philippine Cooperative Code of 2008; and
c.
Such other rights and privileges as may be provided by the General
Assembly.

Section 10. Liability of Members. A member shall be liable for the debts of the
Cooperative only to the extent of his/her subscribed share capital.

Section 11. Termination of Membership. Termination of membership may

be automatic, voluntary or involuntary, which shall have the effect of
extinguishing all rights of a member in the Cooperative, subject to refund
of share capital contributions under Section 13 hereof.

a.
Automatic Termination of Membership. The death or insanity of a
member shall be considered an automatic termination of his/her
membership in the Cooperative: Provided, however, that in case of
death or insanity of a member of a Cooperative, the next-of-kin shall

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 assume the duties and responsibilities of the original member.
Failure of the associate member to meet the minimum requirement of
regular membership, to continue to patronize the products and
services of the Cooperative for two (2) years, and signify his/her
intention to become regular member shall automatically terminate
his/her membership.
b.
Voluntary Termination. A member may, for any valid reason, withdraw
his/her membership from the Cooperative by giving a sixty (60) day
notice to the Board of Directors.
c.
Involuntary Termination. A member may be terminated by a vote of the
majority of all the members of the Board of Directors for any of the
following causes:
i.
Has not patronized the service(s)/business(es) of the Cooperative
as provided for in the policies of the cooperative;
ii.
Has continuously failed to comply with his/her obligations as
provided for in the policies of the Cooperative;
iii.
Has violated any provision of this By-laws and the policies of the
Cooperative; and
iv.
For any act or omission injurious or prejudicial to the interest or
the welfare of the Cooperative, as defined by the General
Assembly.

Section 12. Manner of Involuntary Termination. The Board of Directors shall

notify in writing the member who is being considered for termination and
shall give him/her the opportunity to be heard.

The written decision of the board of directors shall be communicated

in person or by registered mail to said member and is appealable within
thirty (30) days from receipt thereof to the General Assembly or Appeal and
Grievance Committee/Membership Committee, as the case may be, whose
decision shall be final.

Section 13. Refund of Share Capital Contribution. A member whose

membership is terminated shall be entitled to a refund of his/her share
capital contribution and all other interests in the Cooperative.
However, such

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refund shall not be made if upon payment the value of the assets of the
Cooperative would be less than the aggregate amount of its debts and
liabilities exclusive of his/her share capital contribution. In which case,
the member shall continue to be entitled to the interest of his/her share
capital contributions, patronage refund and the use of the services of the
Cooperative until such time that all his/her interests in the Cooperative
shall have been duly paid.

Article III
Administration

Section 1. The General Assembly (GA). The General Assembly is composed of

all the members entitled to vote, duly assembled and constituting a
quorum and is the highest policy-making body of the Cooperative.

Section 2. Powers of the General Assembly. Subject to the pertinent provisions

of the Cooperative Code and the rules issued thereunder, the General
Assembly shall have the following exclusive powers which cannot be
delegated:

a.
To determine and approve amendments to the cooperative Articles of
Cooperation and By-laws;
b.
To elect or appoint the members of the board of directors, and to
remove them for cause;
c.
To approve developmental plans of the Cooperative;

Section 3. Meetings. Meetings of the General Assembly, may be regular or

special. All proceedings and business(es) undertaken at any meeting of the
General Assembly, if within the powers or authority of the Cooperative,
there being a quorum, shall be valid.

Regular and associate members are required to attend the meetings for the
purpose of exercising all the rights and performing all the obligations
pertaining to them, as provided by the Code, Articles of Cooperation and
ByLaws.

Section 4. Regular General Assembly Meeting. The General Assembly shall hold

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its annual regular meeting every 2nd Friday of March at the principal
office of the Cooperative or at any place as may be determined by the
Board.

Section 5. Special General Assembly Meeting. The Board of Directors may, by a

majority vote of all its members, call a Special General Assembly meeting
at any time to consider urgent matters requiring immediate membership
decision. The Board of Directors must likewise call a Special General
Assembly meeting within one (1) month from receipt of a written request
from:

a.
at least ten percent (10%) of the total number of members entitled to
vote,
b.
the Audit Committee; or
c.
the Federation or Union to which the Cooperative is a member; or
d.
upon Order of the Cooperative Development Authority;

Section 6. Notice of Meeting. All notices of meetings shall be in writing and

shall include the date, time, place, and agenda thereof stated therein.

a.
Regular General Assembly Meeting. Notice of the annual Regular General
Assembly meeting shall be served by the Secretary, personally or
his/her duly authorized representative, by registered mail, or by
electronic means to all members of record at his/her last known
postal address, or by posting or publication, or through other
electronic means, at least one (1) week before the said meeting. It
shall be accompanied with an agenda, minutes of meeting of the last
General Assembly meeting, consolidated reports of the Board of
Directors and Committees, audited financial statements, and other
papers which may assist the members to intelligently participate in
the proceedings.
b.
Special General Assembly Meeting. Notice of any Special General
Assembly meeting shall be served by the Secretary personally or
his/her duly authorized representative, by registered mail, or by
electronic means upon each members who are entitled to vote at
his/her last known postal address, or by posting or publication, or

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 through other electronic means, at least one (1) week before the said
meeting. It shall state the purpose and, except for related issues, no
other business shall be considered during the meeting.
c.
Waiver of Notice. Notice of any meeting may be waived, expressly or
impliedly, by the member concerned.

Section 7. Order of Business. As far as practicable, the order of business of a

regular general assembly meeting shall be:

a.
Call to order;
b.
Proof of due notice;
c.
Roll Call;
d.
Reading, consideration and approval of the minutes of the previous
meeting;
e.
Presentation and approval of the reports of the board of directors,
officers, and the committees, including audited financial statements
of the Cooperative Annual Progress Report and all other required
reports;
f.
Unfinished business;
g.
New business;
i.
Election of directors and committee members
ii.
Approval of Development and/or annual Plan and Budget;
iii.
Hiring of External Auditor
iv.
Other related business matters
h.
Announcements; and
i.
Adjournment

Section 8. Quorum for General Assembly Meeting. During regular or special

general assembly meeting, at least twenty-five percent (25%) of the total
number of members entitled to vote shall constitute a quorum.

Section 9. Voting System. Only members entitled to vote shall be qualified to

participate and vote in any General Assembly meeting. A member is
entitled to one vote only regardless of the number of shares he/she owns.

Election or removal of Directors and Committee members shall be by

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secret ballot. Action on all matters shall be in any manner that will truly
and correctly reflect the will of the membership. No proxy and/or
cumulative voting shall be allowed.

Article IV
Board of Directors

Section 1. Composition of the Board of Directors (BOD). The Board of Directors

shall be composed of five (5) members.

Section 2. Functions and Responsibilities. The Board of Directors shall have the
following functions and responsibilities:

a.
Provide over-all policy direction;
b.
Formulate development plan;
c.
Review the annual plan and budget and recommend for the approval
of the General/Representative Assembly;
d.
Evaluate the capability and qualification and recommend for the
approval of the General/Representative Assembly the engagements of
the services of an External Auditor;
e.
Appoint and terminate, based on just cause, the General Manager or
Chief Executive Officer (CEO);;
f.
Review, monitor and evaluate the effectiveness of the programs,
projects and activities;
g.
Formulate and review the vision, mission and goals of the Cooperative;
h.
Establish risk management system;
i.
Establish performance evaluation system at all levels;
j.
Review and approve the organizational and operational structures;
k.
Establish policies and procedures for the effective operation and
ensure proper implementation of such;
l.
Appoint the members of the Mediation and Conciliation Committee,
Ethics Committee, Education and Training Committee and other
Officers as specified in the Code and By-laws of the Cooperative;
m.
Decide election-related cases involving the Election Committee and its
members;

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 n.
Act on the recommendation of the Ethics Committee on cases
involving violations of the Code of Governance and Ethical Standards;
o.
Ensure compliance by the Cooperative with the regulations of the
Authority and other statutory requirements of appropriate
government agencies;
p.
Report to the General/Representative Assembly the performance and
achievements of the Cooperative;
q.
Present to the General/Representative Assembly policies which
require confirmation as provided under the law, the Cooperative By-
laws, and regulations;
r.
Present to the General/Representative Assembly the financial, social
and performance reports; and
s.
Perform such other functions as may be authorized by the
General/Representative Assembly.

Section 3. Qualifications. Any member who is entitled to vote and has the
following qualifications can be elected or continue as member of the Board
of Directors:

a.
Has paid the minimum capital requirement;
b.
Has no delinquent account with the Cooperative;
c.
Have continuously patronized the Cooperative’s services;
d.
A member in good standing for the last two (2) years;
e.
Completed or willingness to complete within the prescribed period the
required education and training whichever is applicable; and
f.
Other qualifications prescribed in the rules and regulations of the
Authority.

Section 4. Disqualifications. Any member who is under any of the following

circumstances shall be disqualified to be elected as a member of the Board
of Directors, or to continue as such:

a.
Holding any elective position in the government, except that of a party
list representative being an officer of a Cooperative he/she represents;
b.
Members holding any other position directly involved in the day-to-
day operation and management of the Cooperative;

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 c.
Having direct or indirect personal interest with the business of the
Cooperative;
d.
Having been absent for three(3) consecutive meetings or in more than
twenty-five percent (25%) of all meetings within the twelve (12) month
period unless with valid excuse as approved by the Board of Directors;
e.
Being an official or employee of the Cooperative Development
Authority, except in a Cooperative organized among themselves;
f.
Having been convicted by final judgment in administrative proceedings
or civil/criminal suits involving financial and/or property accountability;
and
g.
Having been disqualified by law.

Section 5. Procedure for Disqualifications. The procedure for disqualification

shall be provided in the election guidelines or policy of the Cooperative.

Section 6. Election of Directors. The members of the Board of Directors shall

be elected by secret ballot by members entitled to vote during the annual
Regular General Assembly meeting or Special General Assembly meeting
called for the purpose. Unless earlier removed for cause, or have resigned
or become incapacitated, they shall hold office for a term of two (2) years or
until their successors shall have been elected and qualified; Provided, that
majority of the elected directors obtaining the highest number of votes
during the first election after registration shall serve for two (2) years, and
the remaining directors for one (1) year. Thereafter, all directors shall serve
for a term of two (2) years. The term of the cooperators-directors shall
expire upon the election of their successors in the first Regular General
Assembly after registration.

Section 7. Election of Officer within the Board of Directors. The Board of

Directors shall convene within ten (10) days after the General Assembly
meeting to elect by secret ballot from among themselves the Chairperson
and the Vice Chairperson, and to elect or appoint the Secretary and
Treasurer from outside of the Board.

For committees elected by the General Assembly and/or appointed

by the Board of Directors, procedural process of electing the Chairperson,

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Vice Chairperson or other positions among themselves should be in
accordance with the process mentioned above.

Section 8. Meeting of the Board of Directors. The regular meeting of the Board of
Directors shall be held at least once a month. However, the Chairperson or
majority of the directors may at any time call a Special Board meeting to
consider urgent matters. The call shall be addressed and delivered through
the Secretary stating the date, time and place of such meeting and the
matters to be considered. Notice of special meetings of the Board of
Directors, shall be served by the Secretary in writing or through electronic
means to each director at least one (1) week before such meeting.

Majority of the total number of Directors constitutes a quorum to

transact business. Any decision or action taken by the majority members
of the Board of Directors in a meeting duly assembled shall be a valid
cooperative act.

Section 9. Vacancies. Any vacancy occurring in the Board of Directors by

reason of death, incapacity, removal or resignation may be filled-up within
thirty (30) days by a majority vote of the remaining directors, if still
constituting a quorum; otherwise, such vacancy shall be filled by the
General Assembly in a regular or special meeting called for the purpose.
The elected director shall serve only for the unexpired term of his/her
predecessor in office.

In the event that the General Assembly failed to muster a quorum to

fill the positions vacated by directors whose term have expired and said
directors refuse to continue their functions on a hold-over capacity, the
remaining members of the Board together with the members of the Audit
Committee shall designate, from the qualified regular members of the
General Assembly, their replacements who shall serve temporarily as such
until their successors shall have been elected and qualified in a regular or
special General Assembly meeting called for the purpose.

If a vacancy occurs in any elective committee it shall be filled by the

remaining members of the said committee, if still constituting a quorum,

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otherwise, the Board, in its discretion, may appoint or hold a special
election to fill such vacancy.

Section 10. Removal of Members of the Board of Directors and Committee Members.
All complaints for the removal of any elected officer shall be filed with the
Board of Directors and such officer shall be given the opportunity to be
heard. Majority of the Board of Directors may place the officer concerned
under preventive suspension pending the resolution of the investigation.
Upon finding of a prima facie evidence of guilt, the Board of Directors shall
present its recommendation for removal to the General Assembly. For this
purpose, the Board of Directors shall provide a policy on suspension in
consultation with the Ethics Committee subject to the approval of the
General Assembly.

An elective officer may be removed by three-fourths (¾) of the

regular members present and constituting a quorum, in a Regular or
Special General Assembly meeting called for the purpose. The officer
concerned shall be given the opportunity to be heard at said assembly. The
decision of the General Assembly on the matter is final and executory.

In cases where the officers sought to be removed consist of the

majority of the Board of Directors, at least 10% of the members with voting
rights may file a petition with the Cooperative Development Authority to
call a Special General Assembly meeting for the purpose of removing the
Board of Director/s upon failure of the Board of Directors to call an
assembly meeting to commence the proceeding for their removal.

An officer appointed by the Board of Directors may be removed from

office for cause by a majority vote of all the members of the Board of
Directors.

Section 11. Prohibitions. Any member of the Board of Directors shall not
hold any other position directly involved in the day-to-day operation and
management of the Cooperative nor engage in any business similar to that
of the Cooperative or who in any way has a conflict of interest with it

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 The extent of conflict of interest shall be clearly defined in the policy
of the Cooperative.

Article V
Committees

Section 1. Audit Committee. An Audit Committee shall be composed of three

(3) members to be elected during a General Assembly meeting and shall
hold office for a term of one (1) year or until their successors shall have
been elected and qualified. Within ten (10) days after their election, they
shall elect from among themselves a Chairperson, Vice-Chairperson and a
Secretary. No member of the committee shall hold any other position
within the Cooperative during his/her term of office. The Committee shall
provide internal audit service, maintain a complete record of its
examination and inventory, and submit an audit report quarterly or as
may be required by the Board and the General Assembly.

The Audit Committee shall be directly accountable and responsible

to the General Assembly.

Section 2. Functions and Responsibilities. The Audit Committee shall:

a.
Audit the performance of the Cooperative and its various
responsibility centers;
b.
Monitor the adequacy and effectiveness of the Cooperative’s
management and control system;
c.
Review continuously and periodically the books of account, financial
records, and policies governing internal control, accounting and risk
management to ensure that these are in accordance with the
Cooperative principles and generally accepted accounting procedures;
d.
Review the internal audit report of the Cooperative;
e.
Follow up actions on the internal and external audit
recommendations;
f.
Discuss the result of the internal audit with the Board of Directors;
g.
Submit reports on the result of the internal audit and recommend

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 necessary changes on policies and other related matters on operation
to the General/Representative Assembly;
h.
Review, approve or amend the report and recommendation of the
Ethics Committee involving violations of the Code of Governance and
Ethical Standards if the remaining members of the Board of Directors
fail to act on said report and recommendation within a period of
thirty (30) days, or the violation is committed by the majority of the
Board of Directors; and
i.
Perform such other functions as may be prescribed in the By-laws or
authorized by the General/Representative Assembly.

Section 3. Election Committee. An Election Committee shall be composed of

three (3) members to be elected during a General Assembly meeting and
shall hold office for a term of one (1) year or until their successors shall
have been elected and qualified. Within ten (10) days after their election
they shall elect from among themselves a Chairperson, Vice-Chairperson
and a Secretary. No member of the committee shall hold any other position
within the Cooperative during his/her term of office.

Section 4. Functions and Responsibilities. The Election Committee shall:

a.
Formulate election rules and guidelines and recommend to the
General/Representative Assembly for approval;
b.
Recommend necessary amendments to the election rules and
guidelines, in coordination with the Board of Directors, for the
General/Representatives Assembly's approval;
c.
Implement election rules and guidelines duly approved by the
General/Representative Assembly;
d.
Supervise the conduct, manner and procedure of election and other
election related activities and act on the changes thereto
e.
Canvass and certify the results of the election;
f.
Proclaim the winning candidates;
g.
Decide election and other election-related cases except those
involving the Election Committee or its members; and
h.
Perform such other functions as prescribed in the By-laws or

15
 authorized by the General/Representative Assembly.

Section 5. Education and Training Committee. An Education and Training

Committee shall be composed of three (3) members to be appointed by the
Board of Directors and shall serve for a term of one (1) year, without
prejudice to their reappointment. Within ten (10) days after their
appointment, they shall elect from among themselves a Vice-Chairperson
and a Secretary. The ViceChairperson of the Board of Directors shall act as
the Chairperson of the Committee.

The committee shall be responsible for the planning and

implementation of the information, educational and human resource
development programs of the Cooperative for its members, officers and the
communities within its area of operation.

Section 6. Functions and Responsibilities. The Education and Training

Committee shall:

a.
Keep members, officers, staff well-informed regarding Cooperative’s
goals/objectives, policies & procedures, services, etc.;
b.
Plan and implement educational program for coop members, officers
and staff;
c.
Develop promotional and training materials for the Cooperative; and
d.
Conduct/Coordinate training activities.

Section 7. Mediation and Conciliation Committee. A Mediation and Conciliation

Committee shall be composed of three (3) members to be appointed by the
Board of Directors. Within ten (10) days after their appointment, they shall
elect from among themselves a Chairperson, ViceChairperson and a
Secretary who shall serve for a term of one (1) year or until their
successors shall have been appointed and qualified and without prejudice
to their reappointment. No member of the Committee shall hold any other
position in the Cooperative during his/her term of office.

Section 8. Functions and Responsibilities. The Mediation and Conciliation

Committee shall:

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 a.
Conduct mediation-conciliation proceedings and services;
b.
Formulate, develop and improve the Conciliation-Mediation policies,
guidelines and program and ensure its proper implementation;
c.
Monitor Conciliation-Mediation program and processes;
d.
Submit semi-annual reports of cooperative cases to the Authority
within fifteen (15) days after the end of every semester;
e.
Accept and file Evaluation Reports;
f.
Submit recommendations for improvements to the BOD;
g.
Recommend to the BOD any member of the Cooperative for
Conciliation-Mediation Training as Cooperative Mediator-Conciliator;
h.
Issue the Certificate of Non-Settlement (CNS);
i.
Act as conciliator-mediator during their term, provided the persons
who will mediate are mutually selected by both parties; and
j.
Perform such other functions as may be prescribed in the By-laws or
authorized by the Board of Directors.

Section 9. Ethics Committee. An Ethics Committee shall be composed of three

(3) members to be appointed by the Board of Directors. Within ten (10)
days after their appointment, they shall elect from among themselves a
Chairperson, Vice-Chairperson and a Secretary who shall serve for a term
of one (1) year or until their successors shall have been appointed and
qualified and without prejudice to their reappointment. No member of the
Committee shall hold any other position in the Cooperative during his/her
term of office.

Section 10. Functions and Responsibilities. The Ethics Committee shall:

a.
Formulate, develop, implement and monitor the Code of Governance
and Ethical Standards (CGES) to be observed by the members,
officers and employees of the cooperative subject to the approval of
the Board of Directors and ratification by the General/Representative
Assembly;
b.
Conduct initial investigation or inquiry, upon receipt of a complaint
involving violations of the Code of Governance and Ethical Standards;
c.
Submit report on its recommendation together with the appropriate

17
 sanctions, to the Board of Directors for its proper action, or to the
remaining members of the Board of Directors, if the violation is
committed by any member of the Board of Directors. Provided, that if
the remaining members of the Board of Directors fail to act on the
report within a period of thirty (30) days, or the violation is committed
by the majority of the Board of Directors, the Audit committee shall
act on the same; and
d.
Perform such other functions as may be prescribed in the By-laws or
authorized by the Board of Directors.

Section 11. Credit Committee. A Credit Committee shall be composed of three

(3) members to be appointed by the Board of Directors. Within ten (10)
days after their appointment, they shall elect from among themselves a
Chairperson, Vice-Chairperson and a Secretary who shall serve for a term
of one (1) year or until their successors shall have been appointed and
qualified and without prejudice to their reappointment. No member of the
Committee shall hold any other position in the Cooperative during his/her
term of office.

Section 12. Functions and Responsibilities. The Credit Committee shall:

a.
Assist the Board of Directors in the formulation of sound lending and
collection policies, systems and procedure.
b.
Responsible for the credit management of the Cooperative.
c.
In the performance of its functions, it shall process, evaluate and act
upon loan application and withdrawal of deposits, except when the
applicant is a member of the committee, in which case, the
application shall be acted upon by the Board of Directors; and
exercise general supervision including collection over all loans to
members
d.
Responsible for the formulation and conduct of financial and credit
risk management training program.

Section 13. Gender and Development (GAD) Committee. A Gender and

Development (GAD) Committee shall be composed of three ( 3) members to
be appointed by the Board of Directors provided that at least one member

18
shall come from the Board. The Committee shall elect from among
themselves a Chairperson. The Committee members shall hold office until
replaced by the Board.

Section 14. Functions and Responsibilities. The Gender and Development

(GAD) Committee shall:

a.
Conduct gender analysis;
b.
Develop and recommend Gender and Development ( GAD )and
Gender Equality (GE )policies and programs/activities/projects to the
Board;
c.
Monitor and assess progress in the implementation of Gender and
Development (GAD) programs/activities/projects towards achieving
Gender Equality (GE );
d.
Submit report to the Board; and
e.
Provide directional guidance.

Section 15. GAD Focal Person. A GAD Focal Person (GFP) shall be designated
by the Board upon recommendation of the management. He or she must
be an employee of the cooperative and shall perform GFP roles as
additional function

Section 16. Functions and Responsibilities of GAD Focal Person (GFP).

a.
Coordinates and reviews implementation of GAD
programs/activities/projects based on approved plans and budget;
b.
Prepares performance reports and recommends policy improvements
to the GAD Committee;
c.
Gathers and analyzes gender-related information and other data; and
d.
Provides administrative services to the GAD Committee.

Section 17. GAD Education and Training Program. The Cooperative shall
identify GAD and GE-related education and training programs. These shall
be included in the annual education and training plan.

Section 18. GAD Support Systems and Services. The Cooperative shall
implement other services that address GAD and GE issues and concerns.

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It shall also develop and establish necessary support systems that will
enhance implementation of the GAD and GE services of the Cooperative

Section 18. Others Committee. By a majority vote of all its members, the
Board of Directors may form such other committees as may be deemed
necessary for the operation of the Cooperative.

Section 19. Qualification and Disqualification of Committee Members. The

qualification and disqualification of the Board of Directors shall also apply
to all the members of the committees

Article VI
Officers and Management Staff of the Cooperative

Section 1. Officers and their Duties. The officers of the cooperative shall
include the Members of the Board of Directors, Members of the Different
Committees, General Manager/Chief Executive Officer, Secretary and
Treasurer who shall serve according to the functions and responsibilities of
their respective offices as follows:

a.
Chairperson – The Chairperson shall:
i.
Set and prepare the agenda for board meetings in coordination
with the other members of the Board of Directors;
ii.
Preside all meetings of the Board of Directors and
General/Representative Assembly;
iii.
Sign contracts, agreements, certificates and other documents on
behalf of the Cooperative as authorized by the Board of Directors
or by the General/Representative Assembly as prescribed in
their By-laws; and
iv.
Perform such other functions as may be authorized by the Board
of Directors.
b.
Vice-Chairperson –the Vice-Chairperson shall:
i.
Perform all the duties and responsibilities of the Chairperson in
the absence of the latter;
ii.
Perform such other duties as may be delegated by the board of
directors.

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c.
Treasurer – The Treasurer shall:
i.
Ensure that all cash collections are deposited in accordance
with the policies set by the Board of Directors;
ii.
Have custody of funds, securities, and documentations relating
to assets, liabilities, income and expenditures;
iii.
Monitor and review the financial management operations of the
Cooperative, subject to such limitations and control as may be
prescribed by the Board of Directors;
iv.
Ensure the maintenance of full and complete records of cash
transactions;
v.
Ensure maintenance of a Petty Cash Fund;
vi.
Maintain a Daily Cash Position Report; and
vii.
Perform such other functions as may be prescribed in the By-
laws or authorized by the Board of Directors.
d.
Secretary – The Secretary shall:
i.
Keep an updated and complete registry of all members
ii.
Record, prepare and maintain records of all minutes of meetings
of the Board of Directors and the General/Representative
Assembly;
iii.
Ensure that the necessary actions and decisions of the Board of
Directors are transmitted to the management for compliance
and implementation;
iv.
Issue and certify the list of members who are entitled to vote as
determined by the Board of Directors;
v.
Prepare and issue Share Certificates and maintain the share and
transfer book;
vi.
Serve notice of all meetings called and certify the presence of
quorum in the conduct of all meetings of the Board of Directors
and the General/Representative Assembly;
vii.
Keep copies of the Treasurer's reports and other reports;
viii.
Serve as custodian of the Cooperative seal; and
ix.
Perform such other functions as may be prescribed be delegated
by the board of directors.and/or by the GA.
e.
General Manager

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 . The General Manager shall:
i.
Oversee the overall day to day business operations of the
Cooperative by providing direction, supervision, management
and administrative control over all the operating departments
subject to such limitations as may be set forth by the Board of
Directors or the General/Representative Assembly;
ii.
Assist the Board of Directors in the formulation of the
Cooperative's Development Plan including Annual Plan and
Budget, Programs and Projects, for approval of the
General/Representative Assembly;
iii.
Provide systems and procedures in the implementation of
policies;
iv.
Implement the duly approved plans and programs of the
Cooperative and any other directive or instruction of the Board
of Directors;
v.
Provide and submit to the Board of Directors monthly reports on
the status of the Cooperative's operation vis-a-vis its targets and
recommend appropriate policy or operational changes, if
necessary;
vi.
Represent the Cooperative in any agreement, contract, business
dealing, and in any other official business transaction as may be
authorized by the Board of Directors;
vii.
Ensure compliance with all administrative and other
requirements of regulatory bodies; and
viii.
Perform such other functions as may be prescribed in the By-
laws delegated by the Board of Directors or authorized by the
General/Representative Assembly

Section 2. Liabilities of Directors, Officers and Committee Members. Directors,

officers and committee members, who willfully and knowingly vote for or
assent to patently unlawful acts, or who are guilty of gross negligence or
bad faith in directing the affairs of the Cooperative or acquire any personal
or pecuniary interest in conflict with their duties as Directors, officers or
committee members shall be liable jointly and severally for all damages

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resulting therefrom to the Cooperative, members and other persons.

When a director, officer or committee member attempts to acquire,

or acquires in violation of his/her duties, any interest or equity adverse to
the Cooperative in respect to any matter which has been reposed in
him/her in confidence, he/she shall, as a trustee for the Cooperative, be
liable for damages or loss of profits which otherwise would have accrued to
the Cooperative.

Section 3. Management Staff. The core management team of the

Cooperative composed of manager, cashier, bookkeeper, accountant, and
other position as provided for in the Human Resource Manual shall take
charge of the day-today operations of the Cooperative. The Board of
Directors shall appoint, fix their compensation and prescribe for the
functions and responsibilities.

Section 4. Qualification of the General Manager. No person shall be appointed

to the position of general manager unless he/she possesses the following
qualifications and none of the disqualifications herein enumerated:

a.
Must be familiar with the operation of the Cooperative;
b.
Must have at least two (2) years experience in the operations of or
related activities;
c.
Must not be engaged directly or indirectly in any activity similar to
the operation of the Cooperative;
d.
Must be of good moral character;
e.
Must not have been convicted of any administrative, civil or criminal
cases involving moral turpitude, gross negligence or grave misconduct
in the performance of his/her duties;
f.
Must not have been convicted of any administrative, civil or criminal
case involving financial and/or property accountabilities at the time
of his/her appointment; and
g.
Must undergo pre-service and/or in-service trainings.

Section 5. Duties of the Cashier. The Cashier of the Cooperative, who shall be
under supervision and control of the General Manager shall:

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 a.
Handle monetary transactions;
b.
Receive/collect payments and deposits;
c.
Be responsible for money received and expended;
d.
Prepare reports on money matters; and
e.
Perform such other duties as the Board of Directors may require.

Section 6. Duties of the Accountant. The Accountant of the Cooperative, who

shall be under supervision and control of the General Manager shall:

a.
Install an adequate and effective accounting system within the
Cooperative;
b.
Render reports on the financial condition and operations of the
Cooperative monthly, annually or as may be required by the Board of
Directors and/or the General Assembly;
c.
Provide assistance to the Board of Directors in the preparation of
annual budget;
d.
Keep, maintain and preserve all books of accounts, documents,
vouchers, contracts and other records concerning the business of the
Cooperative and make them available for auditing purposes to the
Chairperson of the Audit Committee; and
e.
Perform such other duties as the Board of Directors may require.

Section 7. Duties of the Bookkeeper. The bookkeeper of the Cooperative who is

under supervision and control of the Accountant shall:

a.
Records and update books of accounts;
b.
Provide assistance in the preparation of reports on the financial
condition and operations of the Cooperative monthly, annually or as
may be required by the Board of Directors and/or the General
Assembly;
c.
Keep, maintain and preserve all books of accounts, documents,
vouchers, contracts and other records concerning the business of the
Cooperative and make them available for auditing purposes to the
Chairperson of the Audit Committee; and
d.
Perform such other duties as the Board of Directors may require.

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Section 8. Qualifications of Accountant, Cashier, and Bookkeeper. No person
shall be appointed to the position of accountant and bookkeeper unless they
possess the following qualifications and none of the disqualifications
herein enumerated:

a.
Bachelors degree in accountancy must be required for Accountant
however Cashier and Bookkeeper must be knowledgeable in handling
monetary transactions, accounting and bookkeeping;
b.
Must have at least two (2) years experience in Cooperative operation
or related business;
c.
Must not be engaged directly or indirectly in any activity similar to
the business of the Cooperative;
d.
Must not be convicted of any administrative, civil or criminal case
involving moral turpitude, gross negligence or grave misconduct in
the performance of his/her duties;
e.
Must be of good moral character;
f.
Must be willing to undergo pre-service and/or in-service trainings in
accounting; and
g.
Must not have been convicted of any administrative, civil or criminal
case involving financial and/or property accountabilities at the time
of his/her appointment.

Section 9. Compensation. Subject to the approval of the General Assembly,

the members of the Board of Directors and Committees may, in addition to
per diems for actual attendance to board and committee meetings, and
reimbursement of actual and necessary expenses while performing
functions in behalf of the Cooperative, be given regular compensation;
Provided, further, that the directors and officers shall not be entitled to
any per diem when, if in the preceding calendar year, the Cooperative
reported a net loss or had a dividend rate less than the official inflation
rate for the same year.

Article VII
Capital Structure

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Section 1. Source of Funds. The Cooperative may derive its funds from any or
all of the following sources:

a.
Members’ share capital contribution;
b.
Loans and borrowings including deposits;
c.
Revolving capital build-up which consist of the deferred payment of
patronage refund or interest on share capital;
d.
Subsidies, grants, legacies, aids, donation, awards and winnings and
such other assistance from any local or foreign institution, public or
private;
e.
Retentions from the proceeds of services acquired /goods procured by
members; and
f.
Other sources of funds as may be authorized by law.

Section 2. Continuous Capital Build-Up. Every member shall have invested in

any or all of the following:

a.
At least One Hundred Pesos (P100)per month;
b.
At least Two percent (2%) of his/her annual interest on capital and
patronage refund; and
c.
At least Three percent (3%) of each good procured /service acquired
from the cooperative.

Section 3. Borrowing. The Board of Directors, upon approval of the General

Assembly, may borrow funds from any source, local or foreign, under such
terms and conditions that best serve the interest of the Cooperative.

Section 4. Revolving Capital. To strengthen the capital structure of the

Cooperative, the General Assembly may authorize the Board of Directors to
raise a revolving capital by deferring the payment of patronage refunds and
interest on share capital, or such other schemes as may be legally
adopted. To implement this provision, the Board of Directors shall issue a
Revolving Capital Certificate with serial number, name, rate of interest,
date of retirement and such other privileges or restrictions as may be
deemed just and equitable

Section 5. Share Capital Contribution. Share Capital Contribution refers to the

26
value of the paid subscription by a member in accordance with its Articles
of Cooperation.

Section 6. Share Capital Certificate. The Board of Directors shall issue a Share
Capital Certificate only to a member who has fully paid his/her
subscription. The Certificate shall be serially numbered and contain the
shareholder’s name, the number of shares owned, the par value, and duly
signed by the Chairperson and the Secretary, and bearing the official seal
of the cooperative. All certificates issued and/or transferred shall be
registered in the cooperative’s Share and Transfer Book.

The number of paid share required for the issuance of Share Capital
Certificate shall be determined by the Board of Directors.

The shares may be purchased, owned or held only by persons who

are eligible for membership. Subject to existing government rules or laws,
interests shall be paid only to paid-up shares which may be in cash; or
credited as payment of unpaid subscriptions, outstanding accounts, or
additional shares or to the revolving fund of the cooperative.

Section 7. Assignment of Share Capital Contribution or Interest. Subject to the

provisions of the Code, no member shall transfer his/her shares or interest
in the cooperative or any part thereof unless:

a.
He/she has held such share capital contribution or interest for not
less than one (1) year;
b.
The assignment is made to the cooperative or to a person who falls
within the field of membership of the Cooperative; and
c.
The Board of Directors has approved such assignment.

The assignment of shares shall not be binding to the Cooperative

until such transfer has been registered in the share and transfer book. No
transfer shall be completed until the old certificate has been endorsed and
surrendered to the Cooperative and a new certificate is issued in the name
of the member transferee. The corresponding transfer fee shall be collected
from the transferee as prescribed in the Cooperative policy.

27
 In case of lost or destroyed share certificate, the Board of Directors
may issue a replacement after the owner thereof executes a sworn
affidavit, setting forth the following:

a.
Circumstances as to how, when and where said certificate was lost or
destroyed;
b.
The serial number of the certificate; and the number of shares it
represents;
c.
The lost or destroyed certificate has never been transferred, sold or
endorsed to any third party, provided, that should the same be found,
the owner shall surrender it to the Cooperative; and
d.
That any false representation or statement made in the aforesaid
affidavit shall be a ground for expulsion from the Cooperative

Article VIII
Allocation and Distribution of Net Surplus

Section 1. Allocation. At the end of its calendar year, the Cooperative shall
allocate and distribute its net surplus as follows:

a.
Reserve Fund. Ten percent (10%) shall be set aside for Reserve Fund.
Provided, that in the first five (5) years of operation after registration,
this amount shall not be less than fifty percent (50%) of the net
surplus. The reserve fund shall be subjected to the following rules:
i.
The reserve fund shall be used for the stability of the
Cooperative and to meet net losses in its operations. The
General Assembly may decrease the amount allocated to the
reserve fund when it has already exceeded the authorized share
capital. Any sum recovered on items previously charged to the
reserve fund shall be credited to such fund.
ii.
The reserve fund shall not be utilized for investment, other than
those allowed in the Cooperative Code. Such sum of the reserve
fund in excess of the authorized share capital may be used at
any time for any project that would expand the operations of the
Cooperative upon the resolution of the General Assembly.

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 iii.
Upon the dissolution of the Cooperative, the reserve fund shall
not be distributed among the members. However, the General
Assembly may resolve:
a.
To establish a usufructuary trust fund for the benefit of
any federation or union to which the Cooperative is
affiliated; or
b.
To donate, contribute or otherwise dispose of the amount
for the benefit of the community where the Cooperative
operates. If the member could not decide on the disposition
of the reserve fund, the same shall be given to the
federation or union to which the Cooperative is affiliated
b.
Education and Training Fund. Three percent (3%) shall be set aside for
Education and Training Fund.
i.
Half of the amount allocated to the education and training fund
annually under this subsection may be spent by the cooperative
for education and training purposes; while the other half may be
remitted to a union or federation chosen by the Cooperative or of
which it is a member
ii.
Upon the dissolution of the cooperative, the unexpended balance
of the education and training fund pertaining to the Cooperative
shall be credited to the Cooperative education and training fund
of the chosen union or federation
c.
Community Development Fund. Three percent (3%) shall be used for
projects and activities that will benefit the community where the
Cooperative operates.
d.
Optional Fund, Land and Building and any other necessary fund. Seven
percent (7%)shall be set aside for this purpose.

Section 2. Interest on Share Capital and Patronage Refund. The remaining net
surplus shall be made available to the members in the form of interest on
share capital not to exceed the normal rate of return on investment and
patronage refunds. Provided, that any amount remaining after the
allowable interest and the patronage refund have been deducted shall be
credited to the reserved fund. The sum allocated for patronage refund shall

29
be made available at the same rate to all patrons of the Cooperative in
proportion to their individual patronage, provided that:

a.
In the case of a member patron with paid-up share capital
contribution, his/her proportionate amount of patronage refund shall
be paid to him/her unless he/she agrees to credit the amount to
his/her account as additional share capital contribution;
b.
In the case of member patron with unpaid share capital contribution,
his/her proportionate amount of patronage refund shall be credited
to his/her account until the share capital contribution has been fully
paid;
c.
In the case of non-member patron, his/her proportionate amount of
patronage refunds shall be set aside in a general fund for such patron
and shall be allocated to individual non-member patron and only
upon request and presentation of evidence of the amount of his/her
patronage. The amount so allocated shall be credited to such patron
toward payment of the minimum capital contribution for
membership. When a sum equal to this amount has accumulated at
any time within years, such patron shall be deemed and become a
member of the Cooperative if he/she so agrees or requests and
complies with the provisions of the bylaws for admission to
membership; and
d.
If within the period specified hereof, any subscriber who has not fully
paid his/her subscribed share capital or any non-member patron
who has accumulated, the sum necessary for membership, but who
does not request nor agree to become a member or fails to comply
with the provisions of this bylaws for admission to membership, the
amount so accumulated or credited to their account together with
any part of the general fund for non-member patron shall be credited
to the Reserve Fund or to the Education And Training Fund of the
Cooperative, at the option of the Cooperative.

Article IX
Settlement of Disputes

30
Section 1. Mediation and Conciliation. All inter and intra-cooperative disputes
shall be settled within the cooperative in accordance with the pertinent
Guidelines issued by the Cooperative Development Authority, Art. 137 0f
Republic Act No. 9520 and its Implementing Rules and Regulations,
Alternative Dispute Resolution Act of 2004 and its suppletory laws.

Section 2. Voluntary Arbitration. Any dispute, controversy or claim arising out

of or relating to this By-laws, the cooperative law and related rules,
administrative guidelines of the Cooperative Development Authority,
including disputes involving members, officers, directors, and committee
members, intra-cooperative disputes and related issues shall be
exclusively referred to and finally resolved by voluntary arbitration under
the institutional rules promulgated by the Cooperative Development
Authority, after compliance with the conciliation or mediation mechanisms
embodied in the bylaws of the Cooperative, and in such other applicable
laws

Article X
Miscellaneous

Section 1. Investment of Capital. The Cooperative may invest its capital in any
or all of the following:

a.
Shares or debentures or securities of any secondary cooperative;
b.
Any reputable bank including Cooperative Banks or any secondary
cooperative;
c.
Securities issued or guaranteed by Government;
d.
Real Estate primarily for the use of the Cooperative or its members; or
e.
In any other manner approved by the General Assembly.

Section 2. Accounting System. The Cooperative shall keep, maintain and

preserve all its books of accounts and other financial records in
accordance with the Standards Charts of Accounts (SCA) for Cooperatives
and the Philippine Financial Reporting Framework (PFRF) for
Cooperatives.

Section 3. Financial Audit, Performance Audit, and Social Audit. At least once a

31
year, the Board of Directors shall, in consultation with the Audit
Committee, cause the audit of the books of accounts of the Cooperative,
performance audit and social audit in accordance with the Guidelines
issued by the Cooperative Development Authority

Section 4. Annual Report. During the annual Regular Assembly meeting, the
Officers shall submit a report of the operation to the General Assembly
together with the audited financial statements, performance audit, social
audit reports and list of officers and trainings undertaken/completed. The
annual report shall be certified by the Chairperson and Manager of the
Cooperative as true and correct in all aspects to the best of their
knowledge.

The Cooperative shall submit the web-based Cooperative Annual

Progress Report (CAPR) together with the following attachments to the
Authority within (120) days from the end of every calendar year;

a.
Social Audit Report;
b.
Performance Report including semi-annual Mediation and
Conciliation Report;
c.
Audited Financial Statement; and
d.
List of officers and trainings undertaken/completed.

Article XI
Amendments

Section 1. Amendment of Articles of Cooperation and By-laws. Amendments to

the Articles of Cooperation and this By-Laws may be adopted by at least
two- thirds (2/3) votes of all members with
voting rights, present and constituting a quorum.

The amendment/s shall take effect upon approval by the

Cooperative Development Authority.

Voted and adopted this day of , 20 in ,

Philippines

32
 Names Signature

1. Arevalo, Janet Quiros

2. Casimero, Noel Tambong

3. Castro, Rowiel Arias

4. Cuadernal, Roel Concepcion

5. Dellova, Arlene Asenjo

6. Dellova, Jesse Lemuel Asenjo

7. Dellova, Orlando Oloya

8. Dellova, Sheinnah Joy Asenjo

9. Iledan, Virginia Candelaria

10. Luchin, Anecita Ramos

11. Luchin, Shenah Jane Ramos

12. Oreta, Michelle Ong

13. Ricablanca, Maria Paz Magno

14. Salvador, Elma Cordovero

15. Salvador, Glorilyn Recasa

We, constituting the majority of the Board of Directors of the

Savings Group Aklan Credit Cooperative (SAGA) do hereby certify that the
foregoing instrument is the Code of By-laws of this Cooperative.

Signed this of , , in

Dellova, Orlando Oloya Dellova, Arlene Asenjo

Chairperson Vice-Chairperson

Iledan, Virginia Candelaria Cuadernal, Roel Concepcion Luchin, Anecita Ramos

Director Director Director

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