HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 1 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

PERFORMANCE MANAGEMENT SYSTEM

OVERVIEW

The Performance Management System (PMS) is a vital tool for aligning individual performance
with the Bank’s strategic direction and operational business plans. It is an integrated process by
which the organization involves its employees in improving organizational effectiveness towards
the accomplishment of its mission and strategic goals.

Whereas the Bank shall use the Balanced Scorecard (BSC) as a tool to capture, describe and
translate its strategic goals into defined objectives at group, divisional, departmental, and branch
levels, it shall use the PMS to capture the individual officers’ objectives that are aligned with the
BSC.

This Policies and Procedures Circular shall take effect starting 2014 Performance evaluation
period and shall be observed by the Officers and Supervisors of China Banking Corporation and
all its subsidiaries.

OBJECTIVE

The Performance Management System (PMS) shall achieve the following objectives:

1. Employee Information- to provide an opportunity for a dialogue between the Employee

and his Supervising Officer regarding standards of performance, review how the
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 2 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Employee’s performance measure against these standards, and determine the

Employee’s strengths and areas for development.

2. Employee Development- to assist in determining the Employee’s training and

developmental needs through assessment of gaps in performance and Employee’s
potential.

3. Employee Recognition- to provide venue to recognize and reward outstanding or above

acceptable performance.

4. Employee Placement- to ascertain the Employee’s potential, identified strengths,

inclinations and skills, which may serve as guide for matching the Employee to the right
job.

DEFINITION OF TERMS

Budget Period Twelve-month period, usually from January to December, during

which specific activities should be implemented by the Bank and for
which funding and resource requirements are defined to achieve its
goals and objectives.

Organizational Goal The overall vision, mission and strategic objectives of the Bank as
established by its management and communicated to its employees.

Balanced Scorecard A strategic planning and management system used to align business
(BSC) activities to the vision statement including the strategic business
objectives of an organization. It is used to evaluate an organization’s
impact from several perspectives, such as customer, employees,
internal business processes and financial results.

Key Result Area Refer to the key areas for which the employee needs to produce
(KRA) results. They are general areas of outcomes or outputs for which the
Individual’s role is responsible, and are managed by setting output-
based objectives or goals that are aligned with the overall
organizational goals for a specific budget period.

Key Performance Refer to the factors that describe the indicators of performance or
Indicator (KPI) success for an employee, for each specific KRA.

Performance The process of managing performance of employees to encourage

Management Cycle employee growth and job satisfaction and ensure the attainment of
the strategic business objectives.

Line Manager/ Rater Officer with at least Department Head/Branch Manager position,
responsible for managing the performance of his unit and its
employees.

Performance The process of providing feedback to employees on the status of their

Progress Review performance on a quarterly basis or as needed.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 3 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Annual Appraisal The process of evaluating overall performance of employees against

set standards for a specific budget period.

Performance A program established for employees who are given “Needs

Improvement Improvement” rating in the Annual Appraisal (for current employees)
Program (PIP) or after the third month from hiring or transfer date (for newly
hired/transferred employees) with the objective of improving their
performance to at least “Acceptable” level.

DUTIES AND RESPONSIBILITIES

Unit/Person Responsible Tasks

1. Defines group/divisional/departmental/branch goals in line

with the set organizational goals (BSC) for the year.
Group Head (GH)/Division 2. Cascades the defined goals to subordinates.
Head (DH)/Region Head 3. Reviews and approves KRA of officers within their group to
(RH)/ Area Head (AH) ensure alignment of their KRA to the overall BSC.
4. Approves overall annual rating of Officers under their
group.

1. Together with the employee, develops individual KRAs that

are aligned with overall BSC with set KPIs and
corresponding weights.
2. Monitors and documents progress towards
accomplishment of goals and provides feedback as
Line Manager/Rater (Rater) frequently as needed.
3. Evaluates subordinate’s performance against standards
identified in the goal setting.
4. Recommends over-all annual performance rating of
individual officers under his unit.
5. Conducts performance review discussion.

1. Together with the Rater develops individual KRAs that are

aligned with overall BSC with the set KPIs and
corresponding weights.
Employee/Ratee (Ratee)
2. Monitors and documents progress towards
accomplishment of goals and gives feedback as frequently
as needed.

1. Reviews KRA’s to ensure they are aligned to over-all

business objectives, complementary and that weights are
consistently assigned across units.

PMS Working Committee 2. Ensures that Service Level Agreements across units are
defined and agreed upon.
Note: Composition of the Committee shall be set by the
President every first month of the year.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 4 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Unit/Person Responsible Tasks

1. Conducts bankwide review and calibration of performance
Performance Review Board
rating of Officers.
(PRB)

Human Resources Division – 1. Facilitates the Annual Performance Appraisal of Officers.

Human Resources 2. Convenes the Bank wide Performance Review.
Administration Department
(HRD-HRAD)

1. Facilitates and monitors developmental requirements

Human Resources Division – stated in the PER form through coordination with the
Organization and Employee respective Line Manager.
Development Department 2. Facilitates and monitors development programs and status
(HRD-OEDD) of employees under PIP.

Human Resources Division –

1. Facilitates the process of separation for Officers who will
Employee Relations
fail the PIP.
Department (ERD)

GENERAL GUIDELINES

A. Appraisal Period

1. Regular Performance Appraisal of Officers and Supervisors shall be accomplished at

least once a year, every January following the lapse of the budget period of the
previous year (January to December).

2. However, appraisal may also be required for purposes including, but may not be
limited to the following:
a. Semestral/Quarterly/Monthly Progress Review
b. Transfer of employees from one Group/Division/Department/Branch to another
Unit.
c. Administrative action such as promotion, change in status, etc.
d. Performance Improvement Program

3. An appraisal shall cover a minimum period of three (3) months to a maximum period
of one (1) year.

B. KRA System

1. The Bank shall use the KRA System as a performance management tool for
establishing and documenting the required and actual performance of the employee.

2. The weight of each of the KRA shall be determined based on the level of importance
of the KRA and its contribution to the overall group objectives in the BSC.

3. Each KRA shall be defined by KPI’s which shall measure how the Ratee is performing
or progressing. Each KPI shall also be assigned weights, based on their level of
importance.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 5 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

4. Officer’s KRA shall be aligned with the departmental objectives using the four
perspectives of the Balanced Scorecard.

5. KPIs shall be stated in Specific, Measureable, Agreed upon, Realistic and Time-based
(SMART) terms.

6. Every year, the PMS Working Committee shall review all KRA’s across the bank to
ensure alignment with the Bank’s overall business objectives, target and BSC with
consistent assignment of weights.

C. Performance Evaluation

1. Performance shall be evaluated according to the following dimensions:

a. Performance Dimension- focuses on measures common to all employees of the

Bank, defined by observable behavior that when performed, may indicate
acceptable performance.

Performance Dimension shall be measured according to the following factors:

i. Revenue Maximization – refers to business practices/strategies that

capitalize on increasing profit or revenues of the organization.

ii. Cost Management – refers to practices that shall control and plan the cost
of operations to properly utilize available resources.

iii. Service Excellence/Operational Effectiveness – refers to practices that shall

address the needs and expectations of customers and effectiveness of the
operation or internal controls, and coordination between or among
departments; practices that allow the Bank to better utilize its inputs;
adherence to pertinent policies, rules and regulations and Service Level
Agreements.

This dimension shall consider/include the following factors:

 Result of customer satisfaction survey/feedback
 Resolutions implemented to address/resolve the findings from
the review conducted by Internal Audit, Compliance Testing,
BSP Audit and other regulatory bodies.
 Timely submission of reports that are being required to be
accomplished by the Business Units (i.e. RCSA, BCP,
Compliance Testing, etc.)
 Performance and accomplishment of Compliance and Risk
functions which include submission of critical reports.

b. Behavioral Dimension- focuses on the set of behavior, actions and core values
that an employee must exhibit in successfully carrying out his function, which
may vary depending on the level of the employee’s position in the hierarchy.

Behavioral Dimension shall be measured according to the following factors:

 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 6 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

i. Strategic Orientation – Ability to anticipate and plan for future events,

trends, problems and opportunities and to make sound judgment.
ii. Results Orientation – Ability to focus on and deliver in a constantly
changing environment, and to establish appropriate goals and action plans
based on an understanding of overall deliverables.

iii. People Management/ Leadership – Ability to create and sustain a work

environment that promotes discipline, teamwork, career development and
professional growth. Ability to influence, motivate and inspire people and
develop in them the desire and commitment to work toward a common
objective.

iv. Technical Competence – Comprehensive knowledge and understanding of

the concepts and basic principles of his/her function and its
interrelationships.

v. Customer Focus – Ability to create and nurture internal and external

business and people relationships to assure beneficial working
environment.

2. The overall weight allocation for the two dimensions shall depend on the rank or
position of the Officer. While each dimension shall have sub-elements which shall
have corresponding weights according to job family/level. Weight allocation shall be as
follows:

Overall Weight Allocation

Performance Behavioral
Job/Position Level Total
Dimensions Dimensions
Grp/Div/Dept/Branch Heads,
80% 20% 100%
Marketing & Lending Officers
Technical, Operations & Support
70% 30% 100%
Officers
Note: Management reserves the right to update or revise the scale.

Weight Allocation According to Job Family/Level

Performance Dimension:
Service
Revenue Cost
Job Family Excellence/Operational
Maximization Management
Effectiveness
Marketing 40% 30% 30%
Operations 0% 30% 70%

Support 0% 30% 70%

Technical 0% 40% 60%

 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 7 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Note: Every year, PMS Working Committee shall recommend weight allocation for
performance dimension on a per job family and shall still be subject for approval
of the COO and President.

Behavioral Dimension:

People
Strategic Results Technical Customer
Job Family Management/
Orientation Orientation Competence Focus
Leadership
Group/
Division 30% 20% 25% 10% 15%
Heads
Department
15% 25% 25% 20% 15%
Head

Junior Officers 10% 25% 20% 30% 15%

Note: Assigned weights for each dimension shall be uniform across the Bank.

3. A progress review shall be conducted by the Line Manager/Rater to ensure that actual
performance and behavior are monitored and documented, and that employees are
given feedback on how they have been doing so far, and advised on how to further
improve performance.
Note: Progress review can be done on a semestral, quarterly or monthly basis
depending on the Officer’s function. Sales Officers are encouraged to do
monthly progress review.

D. Performance Cycle/Schedule

1. The Performance Management Cycle shall consist of the following phases:

a. Planning – where performance objectives and standards are defined and

communicated to the employees.
b. Acting – where action is taken to achieve the stated objectives at the targeted
performance levels.
c. Monitoring – where the results are measured and the gaps on performance are
analyzed and addressed.
d. Reviewing – where the performance of an employee is evaluated against the set
standards.

2. The following shall be the schedule of the Performance Management System:

a. Annual Review for budget period January – December

Phase Date Activity Detailed Task

PMS Working Committee
January of Review of PMS
reviews previous year’s
Planning current budget Working Committee
weight allocation for
year (PMSWC)
Performance Dimension
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 8 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Phase Date Activity Detailed Task

and recommends new
matrix for the next review
period.

Ratee and Rater formulate

individual KRA that are
aligned with organizational
goals and objectives and
accomplish the Officer’s
KRA Setting Form. (See
Exhibit 1).
Note: Refer to Annex A for
December of
the complete step by
previous year to Formulation of KRA
step procedures in
January of for the incoming
accomplishing the
current budget year.
form.
year
Rater and Ratee sign on
the Officer’s KRA Setting
Form.
Note: Review shall be
done up to Group
Head level.

Rater submits
st Submission of accomplished and signed
1 Week of
signed/ approved Officer’s KRA Setting Form
February
KRA to HRD-HRAD

Rater monitors actual

performance against goals
indicated in the KRA using
Progress Review Form
(See Exhibit 2) and
Quarterly/Semestral provides update to the
April, July,
Monitoring /Monthly progress Ratee.
October
review Note: The Ratee may
initiate discussion
with the Line
Manager/Rater on
the status update.

Rater and Ratee

st Annual accomplish the Officer’s
1 week of
Performance Performance Appraisal
Reviewing January of
Review for previous Form (See Exhibit 3).
succeeding year
budget period Note: Refer to Annex A for
the complete step by
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 9 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Phase Date Activity Detailed Task

step procedures in
accomplishing the
form.

Rater reviews and validates

the rating as provided by
the Ratee.
Note: Refer to Procedural
Guidelines for the
detailed process.
Group Heads submit PER
st Submission of
1 week of Forms (with recommended
recommended
February rating) of their Officers to
rating to HRAD
HRAD

st PRB Bankwide
1 week of PRB conducts bankwide
Performance
March performance review
Review

After the bankwide

th performance review
4 week of Return of the
conducted by Performance
March Appraisal Form to
Review Board, HRAD shall
the Group Heads
return the signed Appraisal
Form to the Group Heads

Rater discusses the final

rating with the Ratee. If
rating is acceptable, Ratee
signs on the PER Form.
Otherwise, Ratee may an
appeal and discuss with the
Line Manager. The appeal
should be noted by the
Upon receipt of
Group Head and addressed
the signed Discussion with the
to the Performance Review
Appraisal Form Ratee
Board thru HRD.
Note: If the rating result is
Needs Improvement,
Officer shall
automatically be
enrolled in
Performance
Improvement
Program.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 10 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Phase Date Activity Detailed Task

Submission of PER Group Heads submit PER
st forms with Forms (with signature of
1 week of April
signature of the the Ratee) to HRAD for 201
Ratee to HRAD file.

b. New Hires/Transferees
Phases Date Activity Detailed Task
Ratee and Rater formulate
individual KRA that are
aligned with organizational
goals and objectives and
accomplish Officer’s KRA
Setting Form. (See Exhibit
1).
Note: Refer to Annex A for
st
Within 1 week the complete step
upon hiring/ Formulation of KRA by step procedures
transfer in accomplishing
the form.
Planning
Rater and Ratee sign on
the Officer’s KRA Setting
Form.
Note: Review shall be done
up to Group Head
level.
Within two (2)
Rater submits
weeks from the
accomplished and signed
date of Submission of KRA
KRA Setting Form to HRD-
hiring/transfer
HRAD
Rater and Ratee
accomplish the Officer’s
Appraisal Form (See
Exhibit 3)
Note: Refer to Annex A for
the complete step
After three by step procedures
months upon in accomplishing
Reviewing Performance Review
hiring/6 months the form.
upon transfer
Rater reviews and validates
the rating as provided by
the Ratee.
Note: Refer to Procedural
Guidelines for the
detailed process.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 11 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Phases Date Activity Detailed Task

Rater discusses the final
rating with the Ratee. If
rating is acceptable, Ratee
signs on the PER Form.
Otherwise, Ratee may file
an appeal and discuss with
the Line Manager. The
letter of appeal should be
noted by the Group Head
After the Discussion with the
and addressed to the
evaluation Ratee
Performance Review Board
thru HRD.
Note: If the rating result is
NI, Officer shall
automatically be
enrolled in the
Performance
Improvement
Program.

c. Performance Improvement Program

Phases Date Activity Detailed Task
Rater discusses with and
explains the program and
its objectives to the Ratee.
Rater and Ratee formulate
development action plans
by accomplishing PIP KRA
Signing of Setting Form (See Exhibit
st
1 two weeks Undertaking and 4).
Planning upon receipt of enrollment of the
NI rating Officer in the The Rater and Ratee sign
Program on the undertaking (See
Exhibit 5). Rater
coordinates with HRD-
OEDD on the development
plan for the concerned
employee.

Rater provides status

update to the Ratee and
monitors actual
performance against goals
Monitoring Monthly Progress review indicated in the KRA.
Note: The Ratee may
initiate discussion
with the Line
Manager/Rater on
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 12 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Phases Date Activity Detailed Task

the status update.

Rater and Ratee

accomplish the PIP
Appraisal Form (See
Exhibit 6)
2 weeks Prior
st
to end of the 1 Rater reviews and validates
Performance Review
cycle the rating as provided by
the Ratee.
Note: Refer to Procedural
Guidelines for the
detailed process.

Forward signed PIP

After the Discussion with the
Evaluation Form to HRD-
evaluation Ratee
HRAD for 201 file.

After the Rater and Ratee formulate

evaluation of development action plans
st Formulation of action
the 1 cycle by accomplishing PIP KRA
plans
prior to the start Setting Form (See Exhibit
nd
of the 2 cycle 4).
Rater and Ratee
Reviewing accomplish the PIP
Appraisal Form (See
Exhibit 6)
2 weeks Prior
to end of the Rater reviews and validates
nd Performance Review
2 cycle the rating as provided by
the Ratee.
Note: Refer to Procedural
Guidelines for the
detailed process.

Rater discusses the final

rating with the Ratee. If
rating is acceptable, Ratee
signs on the PER Form.
Otherwise, Ratee may file
After the Discussion with the an appeal and discuss with
evaluation Ratee the Line Manager. The
letter of appeal should be
noted by the Group Head
and addressed to the
Performance Review Board
thru HRD.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 13 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

E. Rating Guide

1. In determining the score for each KRA, below shall be the guide in rating the Officer’s
performance:

a. Guide in rating/scoring the accomplishment and expected behavior

%
Numerical
Rating Definition Accomplishment Demonstrated Behavior
Rating
of KRA
Exhibits all the required
behavior at a very
O Outstanding 5 120% and above
exceptional level all of the
time
Exhibits all the required
behavior more than the
VG Very Good 4 106 – 119.99%
acceptable level 80% of
the time
Exhibits all the required
G Good 3 90 – 105.99% behavior at an acceptable
level

Exhibits 80% of the

A Acceptable 2 75 – 89.99% required behavior at an
acceptable level

Needs Behavior requires

NI 1 0 - 74.99%
Improvement immediate improvement
Note: Management reserves the right to revise or update the scale.

b. Guide in over-all rating of the Officer concerned

Numerical Rating Rating Definition

4.67 -5 O Outstanding
3.67-4.66 VG Very Good
2.67-3.66 G Good
1.67 – 2.66 A Acceptable
0 – 1.66 NI Needs Improvement
Note: Management reserves the right to revise or update the scale.

F. Performance Improvement Program

1. The PIP is a program established to ensure that Officers who were not able to achieve
their KRAs for the given budget period are provided with proper support and guidance
with the objective of bringing their performance to at least Acceptable level.

2. An employee who is given a Needs Improvement (NI) rating shall automatically be

enrolled in the Performance Improvement Program following the actual date of
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 14 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

discussion of his final performance rating by the Group Head/Region Head/Division

Head/Area Head/Dept. Head/Branch Head.

3. The covered employee’s performance and developmental efforts will be closely

monitored for the following duration:
Covered Employees Duration
st
1 cycle – 3 months
New Hires nd
2 cycle – 3 months
Existing Employees /Transferees st
1 cycle – 6 months
(employees with atleast six months’ tenure nd
2 cycle – 6 months
as of Annual Rating Period)

4. The Line Manager shall be responsible to closely monitor the performance of the
enrolled employee to ensure that the employee has the proper support to achieve his
goals.

5. Performance shall be assessed after the end of each applicable semester/quarter.

6. Officers who are enrolled in the program must have at least “Acceptable” Rating for
the two consecutive cycles covered by the PIP to be taken out of the program.

7. The following scenarios shall be ground for the dismissal of an employee from his
employment with the Bank or its subsidiaries, subject to the Bank’s policy on due
process:
a. Three consecutive performance ratings of NI
b. Employee enrolled in PIP twice within a period of two consecutive years.

G. Others

1. Appraisal matters are highly confidential and shall only be disclosed to the employee
concerned and to duly Authorized Personnel.

2. Evaluation of Group/Division Heads shall be done by the following:

Ratee Rater

Risk Management Group Head Risk Committee

Internal Audit Division Head Audit Committee

Trust Group Head Trust Committee

Chief Compliance Officer Compliance Committee

All Division Heads except positions mentioned above Group Head

Information and Security Office Head and

President
Security Office Head
All Group Heads except positions mentioned above Chief Operating Officer or President
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 15 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

3. The effect of the administrative sanctions/penalties on Officer’s performance rating

shall be on the year that the sanction/penalties were imposed in accordance with
Bank’s Code of Ethics.
Note: If there’s an appeal, the rating shall be on hold until resolution on the appeal is
arrived at, following the Policies and Procedures in Handling of Administrative
Cases.

4. Performance Rating forms/documents shall be submitted on deadlines set by HRD.

5. Failure to submit the Officer’s Performance Appraisal Form on the due date shall
affect the overall rating of the Line Manager/Rater and shall not merit not more than NI
rating under Behavioral Dimension-People Management Leadership factor.

6. Employee/Ratee Concerned may also be affected, if the latter is at fault and failed to
do his part.

7. Formula for the annual appraisal of employees who transferred from one unit to
another shall be as follows:
(Rating of the Previous Unit X Number of Months rendered / 12)
+
(Rating of the Current Unit X Number of Months rendered / 12)

e.g. (3.5 x 3 months / 12) + (4.2 x 9 months / 12)

0.875 + 3.15 = 4.025
Final Rating: 4.03

PROCEDURAL GUIDELINES

A. Formulation of Organizational Objectives

Senior Management Team

1. Define corporate goals for the incoming year.

Group Head/Region Head/Area Head/Division Head

2. Cascade approved corporate goals to Line Managers.

3. Define departmental/branch goals in line with the organizational goals.

Line Manager/Rater

4. Cascade departmental goals with subordinates.

 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 16 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

B. Formulation of Key Results Area

Line Manager/Rater

1. Based on set department/branch goals, develop KRAs align with overall BSC and
assign KPI with set goals and corresponding weights.

2. Discuss KRA with Group Head.

3. Once KRA has been approved by the Group Head, discuss approved KRA with the
Ratee.

Ratee

4. Based on the discussion, accomplish Officer’s KRA Setting Form (Refer to Annex A
for the complete step by step procedures).

5. Submit KRA Setting Form (See Exhibit 1) for review and approval of the Line
Manager/Rater.

Line Manager/Rater

6. Review KRAs encoded and assign respective weights (Refer to Annex A for the
complete step by step procedures).

7. Submit KRA Setting Form to Group Head.

Group Head/Region Head/Area Head/Division Head

8. Review and approve KRA Setting Form of individual Officers and return to the
respective Line Manager once signed.

Rater/Ratee

9. Discuss the approved KRA and sign-off.

10. Submit KRA to HRD-HRAD for 201 file and keep one copy for file.

C. Progress Review (e.g. Quarterly)

Ratee

1. At the end of the month/quarter, submit accomplishments to Line Manager/Rater vs

the KRA and KPI that have been agreed upon.

Line Manager/Rater

2. Upon receipt of the list accomplishments from the Ratee, discuss and identify
concerns.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 17 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

3. After discussion, summarize and document using the Progress Review Form (See
Exhibit 2).

4. Sign-off Progress Review Form.

5. Keep signed Progress Review Form for file.

Note: Progress Review Forms are not required to be submitted to HRD

D. Annual Appraisal

HRAD Staff

1. Send email notification to all Officers for preparation of the Annual Appraisal.

2. Send second notification.

Ratee

3. Open the file accomplished during the KRA Setting at the start of the year.

4. Review KRAs encoded and validate. For any changes, revise and edit. (Refer to
Annex A for the complete step by step procedures).

5. Once done reviewing/revising the form, encode accomplishments per KRA ((Refer to
Annex A for the complete step by step procedures).

6. Submit file to the Line Manager.

Line Manager/Rater

7. Review and validate KRAs and accomplishments encoded by the Ratee.

8. Discuss with the Ratee factors that may have affected performance of the Ratee.

9. After the discussion, encode comments and corrections, if any and accomplish the
Behavioral Dimension Sheet. (Refer to Annex A for the complete step by step
procedures).

10. Print and forward the accomplished Officer’s Performance Appraisal Form and
Summary Sheet to the Group Head/Region Head/Area Head/Division Head for
approval.

Group Head/Region Head/Area Head/Division Head

11. Review and calibrate the recommended ratings of Officers within the group.

12. If acceptable, affix signature then forward final rating of Officer to respective Rater.

13. Submit signed Appraisal Form to HRD-HRAD and keep one copy for file.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 18 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

HRD-HRAD

14. Upon receipt of the Appraisal Forms, convene Performance Review Board.

15. After the Bankwide Performance Review, update the individual Part III-Summary
Sheet (with the PRB final rating) and send back to the concerned Group Head.

Group Head/Region Head/Area Head/Division Head

16. Upon receipt of the Forms from HRAD, forward to the respective Line Managers for
discussion with their Officers.

Line Manager/Rater

17. Discuss the result of the rating with the Ratee

Ratee

18. Accept and acknowledge the rating.

Rater/Ratee

19. Once agreed, sign-off Officer’s Appraisal Form.

20. Send signed Summary Sheet to HRD-HRAD and safekeep one copy for file.

HRAD Staff

21. Receive signed form and attach to the Part I and II and file for 201.

E. Enrollment to Performance Improvement Program

Note: This shall be conducted after the Announcement of the PRB Performance
Ranking for the Annual Rating or after the finalization of the rating for newly
hired/transferred employees

Line Manager/Rater

1. Discuss Performance Improvement Program with the Officer concerned.

Ratee

2. Understand the objective/purpose of the program and commit full cooperation.

Rater/Ratee

3. Discuss and formulate action plans/development plans to be undertaken.

 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 19 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Ratee

4. Agree on the set action/development plans and review the undertaking.

5. Sign-off Undertaking (See Exhibit 5).

6. Send documents to the following:

 HRD-HRAD – for 201 file
 HRD-OEDD – for monitoring purposes
 HRD-ERD – for their information

F. Performance Evaluation for Officers under PIP

1. Open the file accomplished during the KRA Setting at the start of the year.

2. Review KRAs encoded and validate. For any changes, revise and edit. (Refer to
Annex A for the complete step by step procedures).

3. Once done reviewing/revising the form, encode accomplishments per KRA ((Refer to
Annex A for the complete step by step procedures).

4. Submit file to the Line Manager.

Line Manager/Rater

5. Review and validate KRAs and accomplishments encoded by the Ratee.

6. Discuss with the Ratee factors that may have affected performance of the Ratee.

7. After the discussion, encode comments and corrections, if any and accomplish the
Behavioral Dimension Sheet. (Refer to Annex A for the complete step by step
procedures).

8. Print and forward the accomplished Officer’s Performance Appraisal Form and
Summary Sheet to the Group Head/Region Head/Area Head/Division Head for
approval.

Group Head/Region Head/Area Head/Division Head

9. Review and calibrate the recommended ratings of Officers within the group.

10. If acceptable, affix signature then forward final rating of Officer to respective Rater.

11. Perform the following according to the result of the rating:

a. If the result of the rating is “Acceptable” and above:

Cycle Covered Action to be taken
st
1 cycle of the Officer
1. Monitor performance for another cycle (6-month
in the Program
period).
(6-month period)
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 20 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

Cycle Covered Action to be taken

1. Submit recommendation for Ratee to be taken out
of the Program.
2. Request approval from the Group Head on the
nd
2 cycle of the Officer recommended action.
in the program 3. Discuss the rating with the Ratee.
(6-month period) 4. Send the signed form to the ff:
 HRD-HRAD for 201 file
 HRD-OEDD for monitoring purposes.
 HRD-ERD for monitoring purposes.

b. If the result of the rating is “Needs Improvement”:

Frequency with
“Needs Improvement” Action to be taken
rating
st
1 cycle of the Officer in 1. Monitor performance for another quarter (6-
the Program month period).
nd
(2 time to receive)*
nd
2 cycle of the Officer in
the Program 1. Coordinate with HRD-ERD
rd
(3 time to receive)*
nd
2 cycle of the Officer in 1. Monitor performance for another quarter (6-
the Program month period).
nd
(2 time to receive)*
rd
3 cycle of the Officer in
the Program 1. Coordinate with HRD-ERD
rd
(3 time to receive)*

*From the Annual Rating period prior to inclusion to PIP

G. Formulation of Key Results Area for Newly Hired/Transferred Officers

Line Manager/Rater/Ratee

1. Within first week upon hiring of the new Officer, accomplish Officer’s KRA Setting
Form (Refer to Annex A for the complete step by step procedures).

2. Submit KRA Setting Form (See Exhibit 1) for review and approval to the Group
Head/Area Head/ Region Head/ Division Head .

Group Head/Region Head/Area Head/Division Head

3. Review and approve KRA Setting Form of individual Officers.

Rater/Ratee

4. Sign-off KRA.
 HUM AN RESOURCE POLICIES AND PROCEDURES M ANUAL

SUBJECT: PERFORM ANCE M ANAGEMENT SYSTEM

Policy No: 2014-002 Page 21 of 21
Effectivity Date: January 1, 2014 Approval Date: April 2, 2014

5. Request approval/signature of the Group Head.

Line Manager/Rater

6. Once approved, send form to HRD-HRAD for 201 file

H. Performance Evaluation for Newly Hired/Transferred Officers

1. Open the file accomplished during the KRA Setting.

2. Review KRAs encoded and validate. For any changes, revise and edit. (Refer to
Annex A for the complete step by step procedures).

3. Once done reviewing/revising the form, encode accomplishments per KRA ((Refer to
Annex A for the complete step by step procedures).

4. Submit file to the Line Manager.

Line Manager/Rater

5. Review and validate KRAs and accomplishments encoded by the Ratee.

6. Discuss with the Ratee factors that may have affected performance of the Ratee.

7. After the discussion, encode comments and corrections, if any and accomplish the
Behavioral Dimension Sheet. (Refer to Annex A for the complete step by step
procedures).

8. Print and forward the accomplished Officer’s Performance Appraisal Form and
Summary Sheet to the Group Head/Region Head/Area Head/Division Head for
approval.

Group Head/Region Head/Area Head/Division Head

9. Review and calibrate the recommended ratings of Officers within the group.

10. If acceptable, affix signature then forward final rating of Officer to respective Rater.

Line Manager/Rater

11. Perform the following according to the result of the rating:

a. If the result of the rating is “Acceptable” and above:

i. Finalize the rating and sign off the Appraisal Form.
ii. Submit signed Appraisal Form to HRD-HRAD for 201 file.

b. If the result of the rating is Needs Improvement:

i. Assess and discuss next action with the Group Head.