Professional Documents
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The latest amendments to RA 3591 are contained in RA 10846 signed into law on May 23, 2016. RA
10846 empowered PDIC with stronger authorities to protect the depositing public and promote financial
stability. The new law also includes important provisions to ensure that the PDIC remains financially and
institutionally strong to fulfill its mandate under its Charter.
The PDIC now has the authority to help depositors have quicker access to their insured deposits should
their bank close; resolve problem banks while still open; hasten the liquidation process for closed banks;
and mete out stiffer sanctions and penalties against those who engage in unsafe and unsound banking
practices.
Under amendment, depositors would have quicker access to their insured deposits in the event of bank
closure since PDIC now has the authority to pay insured deposits without netting out depositors’ loan
obligations with the closed bank, and based on evidence of deposits and not on the closed bank’s records
alone.
- Under amendment, depositors would have quicker access to their deposits in the event of bank
closure since PDIC now has the ability to pay directly deposits without offsetting obligations
(authorized but not required)
With its enhanced resolution authorities, PDIC would also be able to more effectively promote financial
inclusion through early intervention in problem banks or open bank resolution. In cases where bank
closure becomes inevitable, the new law enhanced the chances of recovery by creditors of their claims
against the assets of the closed bank by preventing the further dissipation of these assets through
seamless transition from bank closure to liquidation. The new law does away with the 90-day
receivership period and allows PDIC to proceed directly to liquidation. The immediate assignment of
encumbered assets to closed bank creditors, adoption of purchase of assets and assumption of liabilities
as a mode of liquidation, and express prohibition on reopening of banks ordered closed by the Monetary
Board of the Bangko Sentral ng Pilipinas would help enhance recovery rate for creditors of closed banks.
- Previously, receivership before liquidation, but now PDIC can go straight to liquidation avoiding
depositors (creditors of closed banks) to have problems in receiving their deposits
B. Insurable Deposits under PDIC Law (Covered by PDIC Insurance) (Bank Deposits are only
covered and not Money Market Placements)
PAGIBIG
- MP1 (employer and employee)
- MP2 (interest rate is 6-8% without insurance of PDIC but guaranteed of the Republic of the
Philippines) (Problem: Long-term time deposit (5 years))
1. By Deposit Type:
a. Savings Deposit
b. Special Savings
c. Demand/Checking Account
d. Negotiable Order of Withdrawal (NOW)
e. Certificate of Time Deposits
f. Foreign currency Deposit
2. By Deposit Account:
a. Single Accounts - are individually-owned accounts or accounts held under one name, either as
natural person (single proprietorship or individual) or juridical entity (corporation, partnership or
cooperative). (500,000)
b. Joint Accounts - are accounts held under more than one name. (500,000)
i. A joint account regardless of whether the conjunction “and”, “or” or “and/or” is used shall
be insured separately from single accounts.
ii. Unless a different sharing is stipulated in the deposit documents, the insured amount up to
the Maximum Deposit Insurance Coverage of Php500,000 shall be divided equally between
or among co-owners of a joint account.
iii. The total shares of a co-owner in several joint accounts may exceed Php500,000 but will
only be insured up to the Maximum Deposit Insurance Coverage of Php500,000.
iv. Joint accounts held in the names of a juridical entity and a natural person shall be presumed
to belong solely to the juridical entity.
c. Account “By”, “In Trust For” (ITF) or “For the Account of” (FAO) another person (Depositor is
name before “by”) (Depositor is name after “for”)
i. In a “By” account, Ana by Ben, Ana is the depositor.
ii. In an “In Trust For” (ITF) account, Ana In Trust For Ben, Ben is the depositor.
iii. In a “For the Account of” (FAO) account, Ana For the Account of Ben, Ben is the depositor.
d. Explanatory Notes
i. To simplify: In the case where a depositor is the sole beneficial owner of a single, “For the
Account of”, “By”, and “In Trust For” accounts, the consolidated balances of these accounts
shall be insured up to Php500,000. (Considered as single accounts)
ii. The depositor’s total shares in his/her joint accounts shall be separately insured up to
Php500,000.
iii. A depositor with single accounts and joint accounts may have insured deposits of up to
Php1,000,000.
Illustrative examples:
1. How much is Fe Santos’s insured deposit if she has the following four deposit accounts in the same
bank?
ACCOUNT NAME Deposit (in PHP) Insured Deposit of Fe Santos
Fe Santos 100,000 100,000
Ben Santos For the Account of 100,000 100,000
Fe Santos
Charlie Santos In Trust For Fe 100,000 100,000
Santos
Fe Santos’ Store (Sole 700,000 200,000
Proprietorship)
Total 1,000,000 500,000
2. How much is Fe Santos’s insured deposit if she has the following three joint accounts in the same
bank?
ACCOUNT NAME Deposit (in PHP) Insured Deposit of Fe Santos
Fe Santos or Ben Santos 500,000 250,000
Fe Santos and Charlie Santos 1,000,000 250,000
Fe Santos and/or Divina Santos 1,000,000 0*
Total 2,500,000 500,000
*Note: Mrs. Fe Santos does not have any insured deposit share since she already has P500,000 in total
shares in the two joint accounts she has with Ben and Charlie Santos.
3. How much is Fe Santos’s insured deposit for all her single and joint accounts in the same bank?
ACCOUNT NAME Deposit (in PHP) Insured Deposit of Fe Santos
All single accounts of Fe Santos 1,000,000 500,000
in BDO Branch 1
All joint accounts of Fe Santos in 2,500,000 500,000
BDO Branch 2
Total 3,500,000 1,000,000
Note: For purposes of computing the insured deposits, all obligations or loans of the depositor with the
closed bank, as of bank closure, shall be deducted from the depositor’s total deposits with the said bank.
(PDIC Regulatory Issuance No. 2011-04).
Note: In case of joint account involving a juridical/artificial person and a natural person, the maximum
insured deposit of P500,000 to such joint account shall be given to juridical/artificial person only.
Depositors have two (2) years from PDIC’s takeover of the closed bank to file their deposit insurance
claims.
These depositors are entitled to immediate/early payment of deposit insurance claim as part of
PDIC’s initiative to provide convenience to small depositors. Payments to these depositors are
sent as postal money orders to the depositors’ mailing addresses.