Deposit Insurer Takes Over Rural Bank

Philippine Deposit Insurance Corp. took over the Rural Bank of Parañaque, Inc. after the central bank ordered its closure on Monday. The receivership order, which meant the responsibility of recouping as much of the bank’s unpaid loans has been transferred to the state deposit insurer, was stated in Monetary Board Resolution 1616 issued on Monday. Central bank records showed the bank, known for its double-your-money-time-deposit scheme, has a capital deficiency of P983.5 million as of July 2007. RBPI has 37,400 deposit accounts worth P5.4 billion, of which P5 billion is insured. PDIC, by law, is mandated to pay out up to P250,000 in deposit claims per depositor of failed banks. Deposits in excess of P250,000 will be attended to once the bank is liquidated. Read more. In a related story, the country's banking regulator has placed three more rural banks under the receivership of the PDIC while four banks have declared a bank holiday. The Bangko Sentral ng Pilipinas (BSP) has ordered the PDIC to take over the Rural Bank of Bais in Negros Oriental, Pilipino Rural Bank in Cebu, and Rural Bank of San Jose in Batangas. Meanwhile, the Philippine Countryside Bank in Cebu, the Dynamic Bank in Batangas, San Pablo City Development Bank and the Nation Bank in Bacolod have declared a bank holiday. Read more.