THE central bank’s Monetary Board (MB) has ordered a Cebu-based rural bank closed and placed under receivership of the state-run deposit insurer.
In a circular released over the weekend, the central bank said the Monetary Board placed the single-unit Lapu-Lapu Rural Bank Inc. under the receivership of the Philippine Deposit Insurance Corp. (PDIC).
The Monetary Board said the rural bank is now prohibited from doing business in the Philippines, with its assets and affairs placed under the control of the PDIC.
Lapu-Lapu Rural Bank’s head office is in Poblacion II, Carcar City, Cebu.
Depositors of closed banks under PDIC receivership are entitled to be paid up to the maximum insurance coverage of P500,000.
As of December 31, 2015, Lapu-Lapu Rural Bank had 1,909 accounts with total deposit liabilities of P67.6 million. The insured deposits totaled P60.7 million or 89.8 percent of total deposits.
According to the PDIC, depositors with valid deposit accounts of P100,000 and below are eligible for early payment and need not file deposit insurance claims, except when they have outstanding obligations with the closed bank or acted as co-makers of obligations and have incomplete or have not updated their addresses.
“PDIC will start mailing payments to these depositors at their addresses recorded in the bank no later than the third week of February 2016,” the insurer said.
Depositors have until February 10 to update their records using forms to be distributed by PDIC representatives at the rural bank’s premises.
For depositors required to file deposit insurance claims, the PDIC aims to start settlement operations by the third week of February.
The PDIC also announced that it would conduct a depositors-borrowers forum on February 12. It urged depositors to attend so they could verify if they are eligible for early payment.
Lapu-Lapu Rural Bank is the second rural bank to be placed under PDIC receivership this year.
In 2015, the Monetary Board closed down and placed 14 banks under PDIC receivership compared with 15 banks in 2014.