PDIC repeals rule excluding outstanding dues from closed banks’ insured deposits

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THE Philippine Deposit Insurance Corp. (PDIC) has repealed a rule requiring closed banks to deduct outstanding dues of an account holder before computing insured deposits.

In a regulatory bulletin, the state-run firm said they have revoked a seven-year-old rule that requires banks under liquidation to deduct outstanding obligations of a depositor before identifying the amount covered by deposit insurance.

This follows changes introduced in the PDIC Charter which was signed into law as Republic Act 10846 signed on June 11, 2016.

“[T]he obligations of a depositor are no longer netted out from his/her total deposits in the closed bank for purposes of computing insured deposit,” PDIC Bulletin 2018-01 reads, as signed by President Roberto B. Tan on Feb. 2.

Under the PDIC charter, the state insurer steps in as receiver of problem banks and acquires the lender’s assets in order to pay outstanding liabilities to depositors.

The new rule invalidates Regulatory Issuance No. 2011-04, which sets the rules to net out outstanding loans, penalties and charges due from an account holder before finalizing the amount which they will receive as insured deposits.

Bank deposits are insured up to P500,000 per account, according to the law.

The BSP has shut down six rural banks and one thrift bank in 2017, after they were found to be incapable of remaining in business. In 2016, the regulator closed 22 lenders.

Also yesterday, the PDIC said it will auction off at least P157 million worth of properties this February in three separate auctions in Metro Manila and Davao. Among the assets to be sold are residential, commercial and agricultural lots.

Last year, the deposit insurer said it generated a total of P259.16 million from the sale of assets incurred from closed banks as well as corporate properties. Properties worth P201.08 million raised premiums worth P58.08 million.

“The disposal of these assets increases the chances of recovery of uninsured depositors and creditors of their trapped funds. Meanwhile, gains from the sale of corporate assets are added to the Deposit Insurance Fund, PDIC’s main fund source for payment of valid deposit insurance claims.” — Melissa Luz T. Lopez