PDIC pays out P1.18 billion in deposit insurance

MANILA, Philippines — State-run Philippine Deposit Insurance Corp. (PDIC) has paid a total of P1.18 billion in deposit insurance last year, covering 51,278 accounts from banks ordered closed by the Bangko Sentral ng Pilipinas (BSP).

 According to the PDIC, the amount of insurance payout accounted for 92.25 percent of the total claims filed by depositors from shuttered banks in 2019.

“Deposit insurance claims were paid within the target turnaround time of 12 to 42 working days proportioned on the number of valid deposit accounts maintained in the closed bank,” the PDIC said.

PDIC took over 11 banks ordered closed by the MB in 2019.

These were Bagong Bangko Rural ng Malabang (Lanao del Sur) Inc., Rural Bank of Mabitac (Laguna) Inc., The Palawan Bank (Palawan Development Bank) Inc., Valiant Bank Inc., Rural Bank of Basey (Samar) Inc., Rural Bank of Guihulngan (Negros Oriental) Inc., East Coast Rural Bank of Hagonoy Inc., Rural Bank of Larena (Siquijor) Inc., Rural Bank of Lemery Inc., AMA Rural Bank of Mandaluyong Inc., and Maximum Savings Bank Inc.  

 The deposit insurer conducted payout operations for 10 of the 11 closed banks before the year ended. The estimated insured deposits in these banks amounted to P1.27 billion involving 76,650 accounts.

 It was unable to release insurance payouts for AMA Rural Bank of Mandaluyong Inc. due to the 60-day temporary restraining order (TRO) issued by the Court of Appeals (CA) on Nov. 25, 2019 in favor of the bank.

The TRO barred PDIC from continuing its deposit insurance and liquidation operations of AMA Rural Bank.

 PDIC has asked the CA to lift and dissolve the TRO.

Prior to the issuance of the TRO, PDIC was unable to immediately pay the claims of depositors due to the refusal of the bank’s directors and officers to turn over records to PDIC.

 As of June 2019, AMA Rural Bank reported total deposit liabilities of P1.4 billion for 8,434 deposit accounts.

PDIC has advised depositors and creditors of the closed AMA Bank to communicate only with PDIC through its Public Assistance Department.