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Offline AMARANTH

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Explanation of PDIC Coverage
« on: Nov 03, 2006, 01:50 PM »
Advertisement
Illustrative Cases Applying the New Maximum Deposit Insurance Cover of P250,000

Single Depositor Account
   
Quote
Case 1: How much is the effective insurance coverage if Angelo Ramos has the following deposit accounts under his name in the closed ABCD Bank? 
 
Account Type   Balance
 
Acct #1 Savings Account     P 180,000
Acct #2 Checking Account     50,000
Acct #3 Time Deposit       70,000
     
 Total deposits    P 300,000
 Insured deposits    250,000
 Uninsured deposits   50,000

Explanation :  The three accounts are owned by one person, Angelo Ramos.  Thus, all accounts will be consolidated or added together as they are maintained in the same right and capacity, regardless of account type. Total amount insured cannot exceed P250,000.
 

In trust for (ITF) and By Accounts
   
Quote
Case 2: How much will the effective insurance coverage be if Dave, Diane and Danny Santos have the following accounts in the closed EFGH Bank?

Account Holder/s     Balance   
 
Acct #1 Dave Santos    P 280,000
Acct #2  Dave Santos ITF Danny Santos  260,000
Acct #3  Dave Santos by Diane Santos  290,000
 
Dave Santos   
 Acct #1     P 280,000
 
 Acct #3    290,000
      Total deposits   P 570,000
      Insured deposits   250,000
      Uninsured deposits   320,000
     
Danny Santos   
 Acct #2   P 260,000
 
      Total deposits    P 260,000
      Insured deposits  250,000
      Uninsured deposits  10,000
       
Diane Santos : NONE   

Explanation : Dave Santos is the principal owner of Accounts #1 and #3. Thus, these 2 accounts will be consolidated as they are maintained in the same right and capacity; and insurance is up to P250,000 only.   On the other hand, account #2 is owned by Danny Santos with Dave Santos acting as agent.  Danny Santos is thus entitled to a separate maximum limit of P250,000.
   
 
Joint Account

Quote
Case 3: How much is the insurance coverage if Karla, Karen and Kyla Reyes have the following accounts in the closed IJKL Bank?

Account Holder/s   Balance
Acct #1 Karen & Kyla Reyes  P 400,000
Acct #2 Karla &/or Karen Reyes  650,000
 
Karen Reyes  Insured Share  Uninsured Deposits
 
Acct #1 P 125,000 P  75,000 
Acct #2 P 125,000 P 200,000 
                          P 275,000 
Total deposits  P 250,000   
Insured deposits 250,000   
       
Karla Reyes  Insured Share  Uninsured Deposits
 
Acct #2 P 125,000 P 200,000 
       
Total deposits P 125,000   
Insured deposits  125,000   
       
Kyla Reyes Insured Share  Uninsured Deposits
 
Acct #1     P 125,000 P 75,000 

Total deposits      P 125,000   
Insured deposits   125,000   
   
Explanation :  For deposits in excess of P250,000, the amount shared by the co-depositor is only MDIC of the account, thus for Account #1, the share of Karen is P125,000, likewise for Kyla. 

Under the new rules for joint ownership, each joint account is considered equally shared among co-depositors unless otherwise indicated in the deposit document. Insurance coverage of P250,000 will apply to the sum of shares of a depositor in the insured portion of each joint account.
 

Institutional Account
     
Quote
Case 4: How much is the insurance coverage given the following accounts in the closed MNOP Bank?         

Account Holder Balance 
Acct #1    Mamamia, Inc. P 600,000 
Acct #2 Mamamia, Inc. &/or Jiang Yu 800,000 
     
Mamamia Inc.   
Acct #1 P  600,000 
Acct #2 800,000 
       
Jiang Yu  : NONE   
 Total deposits P 1,400,000 
 Insured deposits    250,000 
 Uninsured deposits 1,150,000 
   
Explanation : Joint accounts held by a juridical person with natural person will be presumed to belong to the juridical person. Thus, Accounts #1 and #2 will be consolidated.  Total amount of insured deposits will be P250,000.

Single and joint accounts

Quote
Case 5: How much is the insurance coverage if Benjamin, Jose and Jonas have the following accounts in the closed QRST Bank?

Account Holder/s Balance
 
Acct #1  Benjamin  P    200,000 
Acct #2 Benjamin and Jose  500,000 
Acct #3 Benjamin &/or Jonas   300,000 
Acct #4   Benjamin or Jose or Jonas   400,000 
   
Benjamin (for single account)   
Acct #1   P   200,000
Insured deposits 200,000

(for joint accounts)  Insured Share Uninsured Deposits 
Acct #2 P    125,000 P    125,000 
Acct #3 125,000    25,000 
Acct #4                    0        133,333 
   
Total Insured deposits P    250,000   
Total Uninsured deposits  P    283,333
         
Jose Insured Share Uninsured Deposits 
Acct #2 P    125,000 P    125,000 
Acct #4 83,333      50,000 
  P    175,000
 
Total Insured deposits P    208,333   
   
       
Jonas  Insured Share Uninsured Deposits 
Acct #3 P    125,000 P      25,000 
        83,333       50,000 
  P      75,000 

Acct #4     
   Total Insured deposits P    208,333   
   
Explanation : Under the new rules, single account is insured separately to a maximum coverage of P250,000, thus, Account #1 owned by Benjamin is insured for P200,000. For joint ownership, each joint account is considered equally shared among co-depositors unless otherwise indicated in the deposit document. Insurance coverage of P250,000 will apply to the sum of shares of a depositor in the insured portion of each joint account.

 

Posted on: Nov 03, 2006, 01:47 PM
I got that form the pdic website and thought people must need to know how pdic insurance really works especially to risky banks like these types

Perhaps we can ask the administrator to post this illustration on their home page for every members of this website as references.
« Last Edit: Dec 16, 2008, 10:54 AM by FutureGizmo »

Offline AMARANTH

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Re: PDIC Coverage
« Reply #1 on: Jan 10, 2007, 11:04 PM »
i was wondering......if for example the bank you invested misappropriate their funds into unprofitable ventures and lost big amounts of money or anomalies within the banks board that abused their dosri loan or just plain failed business similar to the rsbc/afpsalai of the minitary......and closed shop, I wonder if pdic would still pay us regardless of any cause done by the bank as long as we are within pdic's 250k insurance limit?......
Posted on: Jan 10, 2007, 10:32 PM
halimbawa:

1.) Yung ipinapahiram nila sa sme or individuals na daily/weekly/monthly na hinihingi ay hindi na makabayad at nagdefault,tumakas, ayaw magbayad etc.

2.) May kalokohan ang mga board of directors at nag invest sa mga negosyo na may kaugnayan sa kanila at pumalpak ang investments tulad ng nangyari sa military banks na afpslai/rsbc.

3.) plain thievery, tinakasan ng isang branch manager o isa sa board of dirctors ang pera na mga depositors.

4.) legitimate business failure or failed requirements such as lack of capital hike requirement/documents or any rules not followed and cause it closure.

etc etc etc.....what i am trying to say is regardless ba kung anong dahilan kaya nagsara ang isang bangko babayaran tayo ng PDIC as long as within 250k?  o baka may fine print yan na hindi natin alam na magdadahilan sila gamit ang mga abogado na like kapag ganito ang dahilan ng closure hindi tayo babayaran nila kahit within pdic insurance level pa kasi nagkasaad sa article ganito ganon na pangpalito lkng at impossible natin malaman........




Posted on: Jan 10, 2007, 10:53 PM
naisipang kong tanungin yan kasi naalala ko na may nagpost dati rito na may insurance nagooffer ng 10% net for 3years at sinasabing in the history of the phil wala pang insurance na bumagsak kasi inaaborbed naman daw ng ibang insurance company kung nag sara at highly regulated blah blah blah....then naalala ko yung tatlong malaking preneed firms na natumba dahil sa open-ended contracts ay hanggang ngayon hindi parin makabayad at ginagamit ang mga abugado manuevers nila para hindi na nila kailangan saluhin yung problema o habulin yung ibang asset nila pang bayad like yung kina YUCHENGCO ng pacific plans (ata?)  so mukhang may spot na sa record ng insurance.....mahirap kasi ang mga ganyan na tipong may "exception to the rule" kaya pwedeng hindi na makabayad so inaaply ko lang ito sa mga bangko......

Offline nailbiter

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Re: PDIC Coverage
« Reply #2 on: Jan 11, 2007, 01:12 AM »
From the FAQ section on the PDIC website:

Quote
What specific risks to a bank does PDIC cover?

PDIC covers only the risk of bank closure ordered by the Monetary Board. Thus, bank losses due to theft, fire, closure by reason of strike or existence of public disorder, revolution or civil war, are not covered by PDIC.
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Offline AMARANTH

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Re: PDIC Coverage
« Reply #3 on: Jan 15, 2007, 12:52 PM »
so........well of the list only theft is what most likely will happen the rest are either seldom or rarely occured.

There is this special privelege for board of directors to borrow the funds of their own bank called dosri loans and they can do whatever they like with the funds from investing on their own private companies using our deposits or just plain but luxury spending for new getaway vacation house.  Its if i remembered correctly cause the downfall of orient bank, afpsalai/rsbc (military bank), urban bank.

Offline inv99

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Re: PDIC Coverage
« Reply #4 on: Jan 15, 2007, 02:38 PM »
I hear that it takes some painful years to receive the reimbursement/return of the insured/pdic covered deposit if any of the said eventualities will occur.

Offline AMARANTH

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Re: PDIC Coverage
« Reply #5 on: Jan 19, 2007, 01:27 AM »
Who’s afraid of bank runs?   
 

BIZLINKS By Rey Gamboa
The Philippine Star 09/10/2004

In the news lately is the bank run on First Savings Bank. Highlights of the television news showed images of angry, frustrated depositors who were late in withdrawing their deposits, victims of the bank run.

Fortunately, with the signing into law of Republic Act 9302, the number of depositors who will lose part of their deposits in the bank will be less. While the country’s 26 million bank depositors can relax a little after the government recently increased the insurance coverage on bank deposits to P250,000 from the former insurable limit of P100,000, this does not totally preclude the precarious situation that our banks are still in.

Banks continue to experience difficulty in narrowing the ratio of capital versus non-performing assets (read: bad loans). And this can still be mortifying for people, especially those whose hard-earned savings are still not fully covered by the new, albeit higher, deposit insurance levels.

On the average, ever since the Asian currency contagion of 1998, some five rural banks close shop every year. In most of these banks whose doors were ordered shut by the Monetary Board, the closure also meant the death warrant of a number of rural enterprises that had been the source of livelihood and jobs in small communities.

Some of these affected small businesses sometimes have to contend with the trauma and opportunity losses of not just one bank closure. Often, the bank they choose to transfer their recovered savings to would end up closing after some time. Banks engaged in unsound banking practices normally trigger, domino effect style, the closing of other banks within the geographical vicinity. More eyes better than one
The recently enacted Republic Act 9302 not only increased the amount of deposit covered by insurance but also restored the Philippine Deposit and Insurance Corp.’s (PDIC) authority to implement stricter monitoring and governance standards for banks. The new law is careful to point out that it is not duplicating work being done by the Bangko Sentral ng Pilipinas.

RA 9302 reverts examination powers to PDIC, a mandate curiously taken away from the agency when the General Banking Act was signed in 2000. With PDIC out of the picture, the frequency and intensity of bank examination became less.

Some say that the reduced bank examination intensity may partly be the reason for failure to spot earlier banks that eventually became distressed in the past four years.

With the restoration of examination powers, the PDIC can once again look at bank ledgers, and even conduct an investigation on a bank based on a complaint lodged against it. Again, the Monetary Board should clear the examination process that PDIC conducts once a year.

I sincerely hope that stricter bank examination will result to greater depositor protection and higher standards of banking governance. Besides, there are now two agencies of the government looking at the slightest signs of bank failure especially of smaller banks that sometimes escape the prying eyes of the BSP examiners.

The important concern of the PDIC and the BSP should be in immediately implementing remedial measures to prevent closures that will be harmful to depositors. Tightening the screws

Some other relevant provisions stipulated in RA 9302 worth mentioning are: continuing deposit insurance coverage for depositors even if the bank is delinquent in premium payments; stiffer criminal and civil liabilities for erring bank owners and officers; legal indemnification for acts of PDIC officials done in good faith; and enhanced regulatory and liquidation powers which includes the authority to reduce abnormally high interest rates on accounts held by closed banks.

Erring bank owners found engaged in unfair and unsound banking practices will be liable to up to 12 years in prison or up to P2 million in fines. Banks that peddle in dubious bank promotions that promise "double your money" schemes in one year should beware.

Let’s just hope that the new law gives PDIC enough muscle and teeth to carry out its mandate. Shoring depositors’ confidence
At least, the amendments on the PDIC Charter will boost the sagging morale of wary depositors who fear bank closure each time the political and economic scenario dims.

With the higher insurance coverage, 96 percent of the total deposits in the banking system will now be fully backed by deposit guarantees, up from 91 percent from the previous insurable cap.

Based on 2003 banking data approximating deposits in the system at P2.4 trillion, the new insurance coverage translate to full insurance coverage for some P716 billion in deposits versus P462 billion at the previous P100,000 cover.

For now, depositors have one more good reason to leave their hard-earned money with banks rather than in the hands of pyramiding con artists.

 --------------------------------------------------

I got the article from RBAP website.  Notice the bolden paragraph i did, it seems that there is indeed a loophole for pdic not to pay depositors in the event that a bank closes down and that is if a bank is delinquent in its insurance payments to pdic.  Now I undestood why my sister's father-in-law didn't even receive the 100,000 pdic coverage ( it was only 100k at that time) when he deposited 3 million (if i remember correctly).....so that is the loophole rural banks will not tell.........

Offline AMARANTH

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Re: PDIC Coverage
« Reply #6 on: Jan 19, 2007, 01:48 AM »
PDIC takes over 3 RBs   
 

The Philippine STAR 01/25/2005


The Philippine Deposit Insurance Corp. (PDIC) has closed three rural banks (RBs) this year and started settlement of more than P400 million in combined deposit insurance claims.

Closed were the Rural Bank of Vinzons (Camarines Norte) Inc., Banco Rural Legaspi Inc., and Banco Sorsogon.

The PDIC, an agency of the Bangko Sentral ng Pilipinas (BSP), reported the settlement of P4.89 million in insurance claims from depositors of the Rural Bank of Vinzons or RB Vinzons. The payout started Jan. 11, only one working day after it took over the bank on Jan. 7.

Five days from start of payout, PDIC has serviced 378 accounts or about 34 percent of the total number of insured deposit accounts of 1,098 and about 82 percent of the total estimated insured amount of deposit liabilities of P5.97 million.

A single unit bank located in Camarines Norte, RB Vinzons was closed by the Monetary Board (MB) of the BSP on Jan. 6. The RB is the first bank closure this year and the fourth to benefit from the new maximum deposit insurance cover of P250,000 effective August last year, after First Savings Bank, Rural Bank of Culasi (Antique) and Ever Development Bank (Zambales).

Meanwhile, the PDIC started the payout operations last Jan. 20 for depositors of Banco Rural Legaspi and Banco Sorsogon. Payout commenced three working days after PDIC simultaneously took over the banks last Jan. 14. The BSP ordered the closures last Jan.13.

Banco Rural Legaspi, established in 1956, has estimated total insured deposit liabilities of P210.6 million consisting of 6,675 insured deposit accounts. It is a five-unit rural bank with head office in Legaspi City and branches in Daet, Camarines Norte; Pili, Camarines Sur; Tabaco, Albay; and Naga City.

Established in 1959, Banco Sorsogon is a four-unit rural bank with head office in Sorsogon City and branches in Gubat and Bulan, Sorsogon; and Daraga, Albay. It has estimated deposit insured liabilities amounting to P193.8 million consisting of 7,764 insured deposit accounts.

Meanwhile, the PDIC renewed its commitment to promote the interest of 26 million depositors nationwide with "a new era of depositor protection with a newly-restructured organization."

The reorganized PDIC will result in a lean organization of 723 officer and rank and file positions, or 31 percent reduced from the present 1,046 positions. It takes effect on February 1. The reorganization process started in September last year when Republic Act (RA) 9302 that amended the PDIC Charter.
 





Posted on: Jan 19, 2007, 01:38 AM
PDIC servicing RB Lilio depositors   
 

The Philippine STAR 06/21/2005


The Philippine Deposit Insurance Corp. (PDIC) has started last June 17 servicing claims of depositors of the closed Rural Bank of Lilio (Liliw, Laguna).

The PDIC advised depositors to proceed to the bank’s offices, all located in the province of Laguna, where they maintained their accounts, during the period designated.

However, depositors of Santiago extension office (EO) must file their claims at the premises of RB Lilio’s head office located in Bonifacio Street, Liliw, Laguna from June 17 to July 14.

The PDIC claims teams will service depositors Monday to Friday, office hours on the following dates: RB Lilio head office in Bonifacio Street, Liliw (including depositors of Santiago EO) – June 17 to July 12; Sta. Cruz branch and Calumpang extension office – June 17 to July 5; and Nagcarlan branch – June 17 to July 7.

After said dates, depositors may file their claims at the PDIC Claims Counter located at the 6/F SSS Bldg., Ayala Avenue corner V.A. Rufino St. (formerly Herrera St.), Makati City, Mondays to Fridays, 8 a.m. to 5 p.m.

RB Lilio was taken over by PDIC on June 10 after the Bangko Sentral ng Pilipinas (BSP), ordered the bank’s closure and placed it under PDIC receivership.

Depositors are advised to present the original evidence of deposit such as savings passbook, certificate of time deposit, bank statements or unused checks; and latest ID with the depositor’s signature. Other documents may be required by the PDIC representatives during the processing of claims.

Under the amended PDIC Charter which took effect on August 2004, the new maximum deposit insurance cover is P250,000. The amended Charter also extended the prescriptive date of filing claims from 18 months to 24 months. The last day for filing claims for the closed RB Lilio is on June 11, 2007.

RB Lilio has total deposit liabilities of over P127 million and 13,477 deposit accounts as of date of PDIC takeover. 

Posted on: Jan 19, 2007, 01:40 AM
2 rural banks closed   
 

The Philippine STAR 02/07/2006


The Philippine Deposit Insurance Corp. (PDIC) has taken over two rural banks as statutory receiver after the Monetary Board (MB) ordered the closure last Jan. 26.

These are the Merchants Rural Bank of Talavera (Nueva Ecija) and Rural Bank of Tangalan (Aklan) Inc. The Nueva Ecija rural bank was taken over Jan. 26 while the Aklan rural bank was taken over Jan. 27.

Merchants RB of Talavera has eight banking units which are all based in Nueva Ecija. Its head office is in Sta. Rosa while its branches are located in Talavera, Muñoz, Cabiao, Zaragosa, Cabanatuan, Gapan and San Jose.

As of June 2005, the bank had deposit liabilities of P393.3 million and more than 9,200 deposit accounts.

The RB Tangalan, with head office in Tangalan, Aklan and one branch located in Sigma, Capiz, had deposit liabilities of P44.7 million and more than 5,200 deposit accounts as of September 2005.

PDIC representatives are currently in the premises of the head offices and branches of these bank conducting examination of deposit records and other bank records in preparation for the processing and payment of claims for insured deposits.

The PDIC is also conducting an inventory of the remaining assets of the closed bank.

PDIC disclosed that it would fasttrack the examination of the deposit records to ensure immediate servicing of claims. The servicing of claims is dependent on the state of the bank records.

The schedule for claims servicing will be published in newspapers and announced over the radio as soon as the masterlist of insured deposits is completed.

Under Republic Act (RA) 9302 that amended the PDIC Charter, the maximum deposit insurance coverage is now P250,000 for each depositor, effective August 2004.

PDIC advised depositors and creditors of these banks to directly transact only with designated PDIC representatives. 

Posted on: Jan 19, 2007, 01:41 AM
Another rural bank falls   
 

The Philippine STAR 02/28/2006



The Philippine Deposit Insurance Corp. (PDIC) has taken over last week The Center Rural Bank as mandatory receiver. This came after the Monetary Board of the Bangko Sentral ng Pilipinas (BSP) ordered the bank closed last Feb. 23.

The single-unit rural bank is located at 10-B Jaysons Bldg., National Road in Muntinlupa City. As of Sept. 30, 2005, the bank had total deposit liabilities of P243.5 million consisting of 2,903 deposit accounts.

PDIC representatives are currently conducting control verification and examination of deposit and other bank records including inventory of its assets in preparation for the servicing of claims for insured deposits.

The duration of the examination will largely depend on the condition of bank records upon PDIC takeover. Depositors and creditors of The Center Rural Bank are can address all concerns and inquiries to the PDIC representatives currently deployed in the bank.

Earlier, the PDIC took over four rural banks closed by the BSP. These are the Urduja Rural Bank of Tayug in Pangasinan, the Rural Bank of Tangalan (Aklan) Inc., Merchants Rural Bank of Talavera (Nueva Ecija) Inc., and the RB of the 21st Century (Balagtas) Inc. of Bulacan.

Most of the closures stem from the institutions inability to meet the minimum capital requirements. Or others could not make the necessary adjustments in capital based on the new international accounting standards.

PDIC officials are urging troubled rural banks to merge with other institutions to avoid the difficult and costly process of receivership and liquidation. "The worst hit are the banking public and the local economies," they added.
 


Posted on: Jan 19, 2007, 01:44 AM
Two RBs close shop   
 

The Philippine STAR 07/11/2006


The Rural Bank of Pilar (Capiz) Inc. and Rural Bank of Malinao (Albay) Inc. has been placed under receivership by the Bangko Sentral ng Pilipinas (BSP) effective July 6 this year.

The Philippine Deposit Insurance Corp. (PDIC) is the statutory receiver of closed banks.

The PDIC, by virtue of BSP Monetary Board Resolution 871 and 872, took over the Rural Bank of Pilar in Capiz and Rural Bank of Malinao (Albay) both of which had huge deposit liabilities and capital deficits or inadequacies.

RB Pilar has two banking units, its head office in Pilar, Capiz and a branch in Roxas City. The RB Malinao is a single unit bank located in Malinao, Albay.

As of June 30, 2005, estimated total deposit liabilities of RB Pilar is P10.24 million with around 1,500 deposit accounts while RB Malinao has estimated total deposit liabilities of P15.78 million with about 6,700 deposit accounts.

PDIC representatives are currently in the premises of the head office and branch of said closed banks conducting examination of the deposit records and other bank records in preparation for the processing and payment of claims for insured deposits. The PDIC is also conducting an inventory of the remaining assets of the closed bank.

In a statement, the PDIC said it was fasttracking the examination of the deposit records to ensure immediate servicing of claims. The state deposit insurer, however, stated that the servicing of claims is dependent on the state of the bank records. It advised depositors and creditors of the two rural banks to directly transact only with designated PDIC representatives.

Under Republic Act (RA) 9302 that amended the PDIC Charter, the maximum deposit insurance coverage is at P250,000 per depositor effective Aug. 12, 2004.
 



Posted on: Jan 19, 2007, 01:46 AM
PDIC takes over Bataan thrift bank   
 

The Daily Tribune
Monday, February 07, 2005


The Philippine Deposit Insurance Corp. (PDIC), as mandatory receiver, takes over the closed Hermosa Savings and Loan Bank Inc. after the Monetary Board of the Bangko Sentral ng Pilipinas (BSP) ordered its closure last Friday.

Hermosa Bank, a thrift bank, maintains 14 branches in Bataan, Pampanga and Makati City.

It has 9,987 accounts with an estimated insured deposit liability of P120.75 million, P106.7 million of which is insured.

Hermosa Bank is the sixth bank to be closed this year.

PDIC assured all depositors that its receivership and examination team is fasttracking the validation of the bank's accounts to expedite payment of insured deposits, schedule of which will be announced later. The duration of the examination will depend on the state and/or condition of the bank's records.

The PDIC also announced that all communications, inquiries and transactions concerning the Bank should be sent or coursed through the PDIC office at the 6/F SSS (Makati) Building, Ayala Avenue corner Herrera St., Makati City, or the designated Deputy Receiver holding office at the premises of the closed bank.

Officers and employees of the closed bank are no longer authorized to transact business on behalf of the bank. Clients who have outstanding loans in the bank are advised to communicate with the designated Deputy Receiver regarding payment/settlement of obligations.
 

Offline nailbiter

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Re: PDIC Coverage
« Reply #7 on: Jan 19, 2007, 08:21 AM »
AMARANTH, those are all old news from 2005 to 2006. Wouldn't it be easier to just check PDIC's list of closed banks? Link here: http://www.pdic.gov.ph/closedbanks/cbindex.asp

Since it is more apt in this thread, your post below from the "certificates of time deposit" thread has been moved here. If you wish to have a particular poster respond to its contents, just direct her here from the same thread so we can keep on topic.

Who’s afraid of bank runs?   
 
BIZLINKS By Rey Gamboa
The Philippine Star 09/10/2004

...

Some other relevant provisions stipulated in RA 9302 worth mentioning are: continuing deposit insurance coverage for depositors even if the bank is delinquent in premium payments; stiffer criminal and civil liabilities for erring bank owners and officers; legal indemnification for acts of PDIC officials done in good faith; and enhanced regulatory and liquidation powers which includes the authority to reduce abnormally high interest rates on accounts held by closed banks.

...

 --------------------------------------------------

I got the article from RBAP website.  Notice the bolden paragraph i did, it seems that there is indeed a loophole for pdic not to pay depositors in the event that a bank closes down and that is if a bank is delinquent in its insurance payments to pdic.  Now I undestood why my sister's father-in-law didn't even receive the 100,000 pdic coverage ( it was only 100k at that time) when he deposited 3 million (if i remember correctly).....so that is the loophole rural banks will not tell.........

From my understanding, this loophole has already been erased by RA 9302, as is precisely written in the paragraph you emphasized. It noted that after the 2004 amendment, there will be a continuing coverage on deposits despite delinquency in premium payments on the part of the bank. If we refer to the PDIC chapter, here is the relevant provision:

Quote
R.A. No. 3591, as amended
An Act Establishing the Philippine Deposit Insurance Corporation, Defining its Powers and Duties and for Other Purposes

Assessment of Member Banks
Sec. 6. (h) The Corporation shall not terminate the insured status of any bank which continues to operate or receive deposits. Should any insured bank fail or refuse to pay any assessment required to be paid by such bank under any provision of this Act, and should the bank not correct such failure or refusal within thirty (30) days after written notice has been given by the Corporation to an officer of the bank citing this subsection, and stating that the bank has failed or refused to pay as
required by the law, the Corporation may, at its discretion, file a case for collection before the appropriate court without prejudice to the imposition of administrative sanctions allowed under the provisions of this Law on the bank officials responsible for the non-payment of assessment fees. (As amended by R.A. 9302, 12 August 2004)
« Last Edit: Jan 19, 2007, 08:41 AM by nailbiter »
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Offline investorsportal

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Re: PDIC Coverage
« Reply #8 on: Jan 20, 2007, 09:27 AM »

Very, very good input, even if it's 2005 & 2006 references. The PDIC new charter which among others upgraded the insurance coverage to Php 250,000.00 per name/account is one refreshing move since it's up from 100K before. It's always a smart move to spread the accounts up to the level PDIC covers. PDIC moves very swiftly now in settling depositors of closed banks.

Offline AMARANTH

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Re: PDIC Coverage
« Reply #9 on: Jan 20, 2007, 12:57 PM »
nailbiter,

oh, I were aware that bsp had a list of all foreclosed bank on their website but my intention was to give people a better idea on what happens when a bank closes, the drama that unfolds, the official statement of pdic/bsp rearding the matter etc.  In short, just about everything that a victimed depositor should expect to endure in the event that happens.

Offline photobrowser

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Re: PDIC Coverage
« Reply #10 on: Jan 30, 2007, 08:30 AM »
Our family was a victim of a rural bank run before during late 90s. 100k pa lang  ang insured sa pdic. pdic took over and liquidated all  assets of the bank. It took over a year para mabayaran lahat ng depositors. Some depositors had over 100k life savings.  pero nabalik Lahat regardless kung 1M or 100k or 20k deposit. Pdic went after the directors, investors and exhausted all possible means to protect the depositors. Nakakaawa nga kasi bata pa ako nawitness ko mga senior citizens umiiyak bec they thought they lost their entire life savings. so dont be too scared na hanggang 250k lang ibabalik.  as a depositor, you are entitled to the full amount of your principal. Basta yun bank madami non liquid assets.
Safe ka pa din.
 



Offline photobrowser

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Re: PDIC Coverage
« Reply #11 on: Feb 01, 2007, 07:27 AM »
   banks are suppose to be the safest financial institution.  sa naiisip ko palang, tatlong governing bodies ang nagbabantay dito: SEC, Central Bank, PDIC.

    mahirap na kasi baka yun mga involved sa mga networking/pyramiding, mutual fund scams na yan eh  magtatayo na lang ng magtayo ng rural bank,   thinking that they can dupe  depositors of getting whatever is over 250k insured by PDIC.

  from what I can recall also,  dapat yun rural banks may big brother na big bank na puwedeng sumalba sa kanya.   yan ata ang naging resolution dahil sa mga bank runs na nangyari noon 90's.    so if you are really keen on investing sa mga rural banks with higher interest rates,  research nyo mabuti kung sino big brother nya.    

   I personally know of a rural bank owner  who was also former BIR comissioner.  sa title pa lang ng may-ari kakatakot na eh,  although soft-spoken sya ang naging client ko sya and he has the muscle to solve problems since he's a former govt. guy,  still, I will not  invest in his bank.


   



 
« Last Edit: Feb 01, 2007, 07:33 AM by photobrowser »

Offline AMARANTH

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Re: PDIC Coverage
« Reply #12 on: Feb 04, 2007, 01:29 AM »
photobrowser,

anong name ng bangko niya?

Offline guido

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Re: PDIC Coverage
« Reply #13 on: Feb 05, 2007, 10:55 AM »
may question lang ako re: pdic coverage

sa joint account amounting to 500K, are the co-depositors entitled to 250K each? or the account is covered only up to 250K?

parang ganito
Account Holder/s         Balance
Acct #1 Karen & Kyla   P 500,000

does karen and kyla have insured deposits of 250K each? or 125K each lang.

another scenario.. 2 joint accounts
Account Holder/s         Balance
Acct #1 Karen & Kyla   P 250,000
Acct #2 Karen & Kyla   P 250,000

'pag ganito how much is insured for each co-depositor? do they get 125K for each account (1 & 2). in effect they still get 250K each?

TIA





Offline nailbiter

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Re: PDIC Coverage
« Reply #14 on: Feb 05, 2007, 12:11 PM »
guido, it seems the answer is already illustrated in Case 3 from AMARANTH's first post.

In said case, Karen had two separate joint accounts with Kyla and Karla respectively, both accounts were over P250K. On each account, both Kyla and Karla, with no other account with the bank, only had P125K each in insured deposits. So in your first scenario, yes, P125K each lang. Karen also had P125K in insured deposits on both of her joint accounts as illustrated in Case 3. So in your second scenario, they will each have P125K insured for each of the two accounts.

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