Photo from Unsplash | Dimitri Karastelev
This article was originally published on June 1, 2022 and has been updated to reflect recent legal developments.
The following post does not create a lawyer-client relationship between Alburo Alburo and Associates Law Offices (or any of its lawyers) and the reader. It is still best for you to engage the services of a lawyer or you may directly contact and consult Alburo Alburo and Associates Law Offices to address your specific legal concerns, if there is any.
Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE:
Under Section 19 of the PDIC Charter, as amended, whenever an insured bank shall have been closed, or upon expiration or revocation of a bank’s corporate term, payment of the insured deposits on such closed bank shall be made by the PDIC as soon as possible.
“Money doesn’t change men. It merely unmasks them.” – Henry Ford
When a bank has been ordered closed by the Bangko Sentral ng Pilipinas, the immediate concern of depositors is not just whether their savings are protected, but how they can recover them.
Under Republic Act No. 3591, as amended, or the Philippine Deposit Insurance Corporation (PDIC) Charter, insured deposits shall be paid by the PDIC. However, in many cases, this requires filing of a claim, subject to specific requirements and deadlines.
Payment of Insured Deposits
Under Section 19 of the PDIC Charter, as amended, whenever an insured bank shall have been closed, or upon expiration or revocation of a bank’s corporate term, payment of the insured deposits on such closed bank shall be made by the PDIC as soon as possible.
The payment may be either by cash or by making available to each depositor a transferred deposit in another insured bank in an amount equal to insured deposit of such depositor.
Provided, however, that before payment, the PDIC, in its discretion, may require proof of claims to be filed before paying the insured deposits, and that in any case where the PDIC is not satisfied as to the validity of a claim for an insured deposit, it may require final determination of a court of competent jurisdiction before paying such claim.
Moreover, in case of failure to settle the claim, within six (6) months from the date of filing of claim for insured deposit, where such failure was due to grave abuse of discretion, gross negligence, bad faith, or malice, shall, upon conviction, subject the directors, officers or employees of the PDIC responsible for the delay, to imprisonment from six (6) months to one (1) year.
Provided, furthermore, that the period shall not apply if the validity of the claim requires the resolution of issues of facts and or law by another office, body or agency including the case mentioned in the first proviso or by the PDICtogether with such other office, body or agency.
Who are Required to File Claims?
The following depositors are required to file claims:
- With valid deposit accounts with balances of more than P500,000.00;
- With outstanding obligations with the Bank, either as borrower, co-maker, or spouse of borrower;
- With incomplete mailing address found in the bank records, or failed to update them through the MAUF;
- With accounts under the names of unregistered entities/associations;
- With accounts not eligible for early payment, regardless of type of account and account balance; or
- Who are deceased, whose filing of claims is through the legal heirs.
When are claims filed?
Section 21(e) of the PDIC Charter, as amended, states that unless otherwise waived by the PDIC , if the depositor in the closed bank shall fail to claim his insured deposits with the PDIC within two (2) years from actual takeover of the closed bank by the receiver, or does not enforce his claim filed with the Corporation within two (2) years after the two-year period to file a claim as mentioned hereinabove, all rights of the depositor against the PDIC with respect to the insured deposit shall be barred.
Related Article:
- ON INSURED DEPOSITS
- WHAT TYPE OF DEPOSITS ARE INSURED BY PDIC?
- WHO IS ENTITLED TO THE INSURED DEPOSIT?
- PAYMENT OF INSURED DEPOSITS
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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding legal services, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/ 09175772207/ 09778050020.
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