Hazel Ann M.

Orteza BSBA FM 2-7s

WEEK 8

Answer the following questions:

1. What are insured deposits? Give examples and explain.

— Insured deposit means the amount due to any bona fide depositor for
legitimate deposits in an insured bank net of any obligation of the depositor to the
insured bank as of date of closure, but not to exceed P500,000.00. Deposits of all
commercial banks, savings and mortgage banks, rural banks, private development
banks, cooperative banks, savings and loan associations, as well as branches and
agencies in the Philippines of foreign banks and all other corporations authorized to
perform banking functions in the Philippines are insured with PDIC.
2. Are Joint Accounts insured?
—Yes, they are insured. A joint account regardless of whether the conjunction
"and", "or", "and/or" is used, shall be insured separately from any individually-owned
deposit account/s. If the account is held jointly by two or more natural persons, or by two
or more juridical persons or entities, the maximum insured deposit shall be divided into
as many equal shares as there are individuals, juridical person or entities, unless a
different sharing is stipulated in the document of deposit. If the account is held by a
juridical person or entity jointly with one or more natural persons, the maximum insured
deposit shall be presumed to belong entirely to such juridical person or entity.

Exercise # 4

1. A government instrumentality created in 1963 by virtue of Republic Act 3591 to insure

the deposits of all banks which are entitled to the benefits of insurance.
Ans. Philippine Deposit Insurance Corporation
2. The maximum deposit insurance coverage effective June 1, 2009.
Ans. P500,000
3. It is the amount due to any bona fide depositor for legitimate deposits in an insured bank
net of any obligation of the depositor to the insured bank as of date of closure, but not to
exceed P500,000.00.
Ans. Insured Deposit
4. It shall be insured separately from any individually-owned deposit account.
Ans. Joint Account
5. It aims to pay valid claims as soon as possible.
Ans. PDIC
6. It stipulates that PDIC will not pay deposit insurance.
Ans. R.A. No. 9576
7. It provides that a Philippine bank may elect to insure with the PDIC its deposits in
branches outside the Philippines.
Ans. PDIC Charter
8. Functions of PDIC.
Ans. Deposit Insurer, Co-regulator of Banks, Receiver and Liquidator of Closed
Banks