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BSP Places BF Under PDIC Receivership; 97% of Depositors Covered by Deposit Insurance

03.17.2011

The Monetary Board in its meeting today decided to place Banco Filipino Savings and Mortgage Bank (BF) under the receivership of the Philippine Deposit Insurance Corporation to provide immediate relief to its 177,652 depositors, 97% of whom are small depositors fully covered by deposit insurance of up to P500,000 each. 

The BSP is coordinating closely with PDIC so that deposit insurance can be paid out as soon as possible. In this connection, the condition, coverage, and quality of the records and documents of BF will be material in ensuring immediate service to depositors.    

As of this afternoon, the PDIC has started taking over the BF offices starting with the head office to secure the records and documents at the bank premises. PDIC’s take over will also prevent the further dissipation of the bank’s assets and assure maximum benefits to its depositors and creditors.

Depositors with account balances of P5,000 and below, without loans and whose last known addresses are reflected in bank records, need not file their deposit insurance claims as PDIC will immediately process and start mailing payments  through postal money order within a week. Depositors with balances of  P5,000 and below represent 53% of total account holders.  All other depositors are required to file their deposit insurance claims with PDIC. 

In deciding to place BF under receivership, the MB took the following into consideration:
1. BF is unable to pay its liabilities as they become due in the ordinary course of business;
2. BF has insufficient realizable assets to meet its liabilities;
3. BF cannot continue in business without involving probable losses to its depositors and creditors.

The MB took note of the failure of the Board of Directors/management of BF to restore the Bank’s financial health and viability despite considerable time given to address its financial problems, and after according the Bank the requisite due process. It has therefore decided to prohibit BF from doing business in the Philippines and to place its assets and affairs under receivership, with PDIC as designated Receiver, in accordance with Section 30 of Republic Act (R.A.) No. 7653 (The New Central Bank Act).

The MB also authorized the filing of appropriate cases, if warranted, against BF’s directors, officers and/or other individuals who may be found liable for violation of banking laws and Bangko Sentral ng Pilipinas rules and regulations.

The PDIC will issue appropriate announcements to guide BF depositors to file their claims for deposit insurance. Other information and claims forms may be downloaded from the PDIC website at www.pdic.gov.ph.  The PDIC may also be reached at telephone numbers  841-4630 to 4631.

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