PDIC Act RA 3591 Flashcards
What are the functions of PDIC?
- Deposit Insurer
- Co-regulator of banks
- Receiver and liquidator of closed banks
Insured deposits
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 the date of the closure, NOT TO EXCEED P500,000
What is a systemic risk?
The possibility of failure of one bank to settle net transactions with other banks will trigger a chain reaction, depriving other banks of funds leading to a general shutdown or normal clearing and settlement activity.
-likelihood of a sudden, unexpected collapse of confidence in a significant portion of the banking or financial system with potentially large real economic effects.
Coverage of PDIC Act
The deposit liabilities of any bank or banking institution, which is engaged in the business of receiving deposits as herein defined on the effective date of the PDIC Act, or which thereafter may engage in the business of receiving deposits, shall be insured with PDIC.
How does splitting of deposit occur?
a. A deposit account with an outstanding balance more than P500,000 is broken down and transferred to two or more accounts in the name of persons or entities who have no beneficial ownership in the transferred deposits in their names
b. within 120 days immediately preceding or during a bank-declared bank holiday or immediately preceding a closure order issued by the Monetary Board
c. for the purpose of availing the maximum deposit insurance coverage
What deposits accounts are not entitled to payment?
- Deposits that resulted from SPLITTING OF DEPOSIT
- Deposit products or money placements by the head office of a foreign bank in its branch in the Philippines because there is only one entity
- Deposits determined to be proceeds of an unlawful activity as defined under RA 9160 or the AMLA
- Deposits payable in a place outside the Philippines
- Unfunded deposit accounts or transactions and that are fictitious or fraudulent
- Deposits emanating from unsage and unsound banking practice
- Investment products such as bonds and securities, trust accounts and other similar instruments
What shall a depositor present in order to be recognized as a depositor entitled to the rights in PDIC Act?
Certificate of Deposit with his name registered as the owner/holder thereof in the books of the issuing bank
How long is the period to file claim?
2 years from the actual takeover of the closed bank
How long is the period to enforce a claim?
2 years after the 2-year period to file a claim
What are the effects of non-filing or non-enforcement of claim within the period stipulated?
- All rights of the depositor against the PDIC with respect to the insured deposit shall be BARRED
- All rights of the depositor against the closed bank and its shareholders or the receivership estate to which PDIC may have become subrogated shall thereupon revert to the depositor.
- PDIC shall be discharged from any liability on the insured deposit.
Modes of payment
- Cash
- by making available to each depositor a transferred deposit in another insured bank in an amount equal to insured deposit of such depositor
What is the period for the PDIC to settle claim?
6 months from the date of filing of the claim
