Legacy rural banks on bank holiday?

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Update: Two days after this article was posted, there are now official reports about Legacy banks closing and declaring a bank holiday. Read more here: Update on Legacy rural banks and in the Legacy Banks discussion thread.

After months of speculation in the PMT Forum, several banks under the Legacy Financial Group reportedly declared a bank holiday early this week, meaning they are, for the meantime, closed while planning for the next steps.

There are no official news available online yet but here’s what we have gathered so far based on posts by several PinoyMoneyTalk members.

Please note that the following are unofficial and unconfirmed statements and are merely opinions of PMT Forum members. As of this writing, there is no official word yet from the Bangko Sentral ng Pilipinas (BSP) or the Legacy Group.

lowprofile: Guys I just came back from RBOP [Rural Bank of Paranaque] Ortigas Branch and they are on bank holiday and there is a note there that they are waiting for the “Emergency Loan” from BSP to re-open. It’s like passing the hot potato back to BSP. BSP should immediately act on this issue before it damages the whole banking industry as the Legacy banks are the largest rural bank now.

broas: Since 11 months, i have been getting my interest – automatically deposited to my BPI account. However, just last Saturday, i received a call from the teller (the one who recruited me to invest) saying their President informed them that BSP has taken over their bank and starting today, Bank Holiday na sila (meaning close na ung bank and they are already jobless). He is asking me to keep all my documents since the next step is PDIC na. He himself together with all members of his family have invested in the bank.

baka: Finally, I was able to speak with the person in charge with RBP at BSP. She said, she is still confirming the special bank holiday because it was declared by RBP not BSP.

FOREX: I called up my agent this noon. She told me that one of the branch managers of Rural Bank of Paranaque informed her that the bank was closed indeed. He told her also the it seems the BSP is not inclined on extending loan to the bank.

PhilResident: As far as confirmed for me: 3 banks are on a bank holiday: Rural Bank of Paranaque, Pilipino Rural Bank, Rural Bank of Bais (Supreme Bank). Bank holiday does NOT mean that they are out of business yet. Would BSP give emergency loan when requested by a bank? Should not speculate on this, but you might wonder what will be wise for the BSP to do, considering the Philippine economics. Anyhow, that is up to them. Monthly incoming seems to bounce from date Dec 2 onwards for some/several banks, which is in the light of the ongoing audits not a surprise. The checks I personally will receive back as bounced will be hold in my possession for a while, awaiting for an update what to do with them.

levi_pinoy: Heto yung text nung Legacy agent sa kapatid ko: Just now, an emergency meeting was scheduled by our Chairman 1st hour today. After my probing of the nature, I learned that an extensive untimely withdrawals occurred last week in our Laguna & Cebu banks due to bad publicity again in the Inquirer by Daxim Lucas last Tuesday. All our banks has enough liquidity for regular maturing deposits and interest due but any banks would give in if massive withdrawals would arise. I’ll inform u for further developments but in any case please ready your Certificate of Deposit.

Got some official news or just want to join the discussion? Drop by the following related forum threads:

About the Author

James Ryan Jonas teaches business strategy, investments, and entrepreneurship at the University of the Philippines (UP). He is also the Executive Director of UP Provident Fund Inc., managing and investing P3.1 Billion ($56 Million) worth of retirement funds on behalf of thousands of UP employees.

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5 thoughts on “Legacy rural banks on bank holiday?”

  1. This makes me worry even if I don’t have an account with the Legacy Group. I have substantial savings (but within the PDIC maximum) in several rural banks here in La Union. Now I’m reconsidering if I should transfer my funds into commercial (and thus, more stable) banks.

    Reply

  2. Im very much worried about this incident, ,til now i dont know what is the best things todo coz i already withdrwn my time dposit even without 20% interest but the promblem is the chek they give is WALANG PONDO,,,,,Wala talaga silang pera kasi 2months kung BINIGyan ng time pra mabawi ko but sinauli naman pro walang LAMAn….Sa tagbilaran po to na Pilipino Rural Bank…

    Reply

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