PHILIPPINE DEPOSIT INSURANCE CORPORATION

RA 3591; amended by RA 10846

Highlighted Sections (RA 3591 as Amended) 1,2,3,5,6,7

A. Purpose and Changes Brought by this Act

 SECTION 1. The Creation of PDIC
o PDIC insures the deposit of all banks entitled to such benefits
o Basic policy: promote & safeguard the interest of the depositing public; help
maintain a sound & stable banking system
 SECTION 2. State Policy
o To strengthen the mandatory deposit insurance coverage system to generate,
preserve, maintain faith, & confidence in the country’s banking system, and
protect it from illegal schemes & machinations
o PDIC despite a govt instrumentality, shall have fiscal & administrative autonomy
 SECTION 5. Definition of Terms
a. Asset
b. Asset distribution plan
c. Board of Directors
d. Bank & banking institution
e. Closed bank – under liquidation by BSP Monetary Board
f. Creditor – of a closed bank
g. Deposit – unpaid balance of money or equivalent received by a bank; given or
obliged to give credit to evidence of deposit
i. PDIC must not pay deposit insurance for the following
accounts/transactions:
1. Investment products
2. Fraudulent or fictitious deposit accounts
3. Deposit accounts from unsafe or unsound bank practices
4. Deposits that are determined to be proceeds of an unlawful
activity (RA 9160 – AMLA)
h. Disputed claim – against the assets of a closed bank
i. Insured bank
j. Insured deposit
k. Liquidation
l. Liquidation court – RTC of general jurisdiction
m. Payout – payment of insured deposits
n. Petition for assistance in the liquidation of a closed bank
o. Purchase of assets & assumption of liabilities
p. Receiver
q. Records
r. Residual assets
s. Resolution
t. Risk-based assessment system
u. Statement of affairs
 v. Surplus dividends
w. Takeover
x. Transfer deposit
y. Trust funds
z. Valid claim
aa. Winding up

B. Board of Directors
 SECTION 3. Board of Directors: Composition & Authority
o Powers of PDIC shall be vested in & exercised by the BOD
o Composed of 7 members
 Secretary of Finance; ex officio chairperson w/o compensation
 Governor of BSP; ex officio member w/o compensation
 President of PDIC; 6-year term & serve as vice-chairperson
 From a shortlist by the Govt Commission for GOCC’s (RA10149)
then selected by PH President
 4 other members from the private sector; 6-year term
 From a shortlist by the Govt Commission for GOCC’s (RA10149)
then selected by PH President
 Subject to 1 reappointment only
o BOD appointees must be:
 of good moral character, competent in economics, banking & finance,
law, management administration, or insurance
 at least 35 yrs. old
 after 1 year of office, must be disqualified from holding any office,
position, or employment in any insured bank

C. Deposit Coverage
 SECTION 6. Deposit Insurance Coverage
o Deposit liabilities of any bank that receives deposits
o If a bank is identified by BSP as capital deficient, PDIC may conduct a risk
evaluation to assess the risks to the DIF (deposit insurance fund)

D. Assessment of member banks, sanctions for unsafe banking practices, closure,

liquidation of closed banks.
 SECTION 7. Assessment of Member Banks
 SECTION 8. Sanctions Against Unsafe and Unsound Bank Practices
 SECTION 12. Liquidation of a Closed Bank
 SECRECY OF BANK DEPOSIT
RA 1405
AN ACT PROHIBITING DISCLOSURE OF OR INQUIRY INTO, DEPOSITS WITH ANY
BANKING INSTITUTION AND PROVIDING PENALTY THEREFORE
Approved, September 9, 1955.

SECTION 1. Declaration of Policy

 give encouragement to the people to deposit their money in banking institutions
 discourage private hoarding so that the same may be properly utilized by banks
in authorized loans to assist in the economic development of the country.
SECTION 2. Bank deposits & PH treasury bonds are absolutely confidential; may not be
examined, inquired or looked into by any person, government official, bureau or office, except…
 upon written permission of the depositor
 or in cases of impeachment,
 or upon order of a competent court in cases of bribery or dereliction of duty of
public officials, or in cases where the money deposited or invested is the subject
matter of the litigation.
SECTION 3. Official or employee of a banking institution cannot disclose…
SECTION 5. Penalty: 5 yrs. max of imprisonment or P20,000 max fine, or both in the discretion
of the court.
 ANTI-MONEY LAUNDERING ACT
RA 9160, as amended; RA 9194; RA 10167; RA 10365; RA 10927; RA 11521
Sections 2,3,4,7,13,14
A. Covered transactions and institutions and suspicious transactions
 SECTION 2. Declaration of Policy
o It is hereby declared the policy of the State to protect and preserve the integrity and confidentiality
of bank accounts and to ensure that the Philippines shall not be used as a money laundering site
for the proceeds of any unlawful activity. Consistent with its foreign policy, the State shall extend
cooperation in transnational investigations and prosecutions of persons involved in money
laundering activities wherever committed.
 SECTION 3. Definitions
a) covered institution
b) covered transaction
c) monetary instrument
d) offender
e) person
f) proceeds
g) supervising authority
h) transaction
i) unlawful activity

B. Money laundering as a crime and unlawful activities and its jurisdiction.

 SECTION 4. Money Laundering Offense - money laundering is a crime whereby the
proceeds of an unlawful activity are transacted, thereby making them appear to have
originated from legitimate sources. It is committed by the following (4a-c) (transact;
facilitate money laundering; failure of disclosure to AMLC)
a) Any person knowing that any monetary instrument or property represents, involves, or relates to,
the proceeds of any unlawful activity, transacts or attempts to transact said monetary instrument or
property.
b) Any person knowing that any monetary instrument or property involves the proceeds of any
unlawful activity, performs or fails to perform any act as a result of which he facilitates the offense
of money laundering referred to in paragraph (a) above.
c) Any person knowing that any monetary instrument or property is required under this Act to be
disclosed and filed with the Anti-Money Laundering Council (AMLC), fails to do so.
 SECTION 5. Jurisdiction of Money Laundering Cases
o Regional trial courts – all cases, general rule
o Sandiganbayan - Those committed by public officers and private persons who
are in conspiracy with such public officers

C. Anti-Money Laundering Council.

 SECTION 7. Creation of Anti-Money Laundering Council (AMLC)
o Chairman- BSP Governor
o Members: Commissioner of Insurance Commission; Chairman of SEC

D. Mutual Assistance Among States.

 SECTION 13. Mutual Assistance among States.
a) Request for Assistance from a Foreign State
b) Powers of the AMLC to Act on a Request for Assistance from a Foreign State.
 c) Obtaining Assistance from Foreign States
d) Limitations on Request for Mutual Assistance
e) Requirements for Requests for Mutual Assistance from Foreign States.
f) Authentication of Documents.
g) Extradition - a State requests from the requested State the return of a person accused or convicted
of a crime to stand trial or serve a sentence in the requesting State
 SECTION 14. Penal Provisions