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PDIC hikes deposit insurance fund to P216 billion

State deposit insurer Philippine Deposit Insurance Corporation has built up its deposit insurance fund (DIF) to P216.85 billion, as of the fourth quarter of 2020, and settled 100 percent of the 7,072 valid deposit insurance claims within its target turnaround time for banks ordered closed last year.

The DIF represents PDIC’s overall capacity to respond to insurance calls due to bank failures. The prompt settlement of deposit insurance claims, on the other hand, provides affected depositors the needed relief.

In a report to Finance Secretary Carlos Dominguez III, PDIC president Roberto Tan said its DIF posted a double-digit growth of 10.3 percent, or P20.33 billion, from its 2019 level of P196.52 billion.

The increase resulted in an adequacy level of 6.91 percent in terms of ratio of the DIF to the banking system’s estimated total insured deposits. The ratio was above the minimum target of 5.5 percent for 2020.

Tan said PDIC will endeavor to maintain adequate DIF cover at prudential level.

Dominguez said PDIC’s record of performance has been marked by the prudential management of the deposit insurance fund and the prompt settlement of deposit insurance claims.

The DIF consists of reserves for insurance losses of P193.64 billion, retained earnings of P20.21 billion, and permanent insurance fund of P3 billion.

The PDIC also reported that, of the total deposit insurance claims involving 7,072 deposit accounts in five banks closed last year, 6,733 accounts involved deposits of P100,000 and below, were settled within target turn-around-time to eligible depositors, while 339 were for deposits with balances of more than P100,000.

Tan said the PDIC aims to continue the prompt settlement of deposit insurance claims by expanding to digital payment platforms this year, including Instapay and the multi-channel disbursement facility of a government bank.

He added that PDIC is also targeting in 2021 the reduction of loan accounts by 17,825 and real property assets by 807 from the baseline set in 2019.

To support the government’s coronavirus disease 2019 response efforts and comply with the provisions of the Bayanihan 1 and 2 laws, the PDIC extended the statutory deadlines for filing of deposit insurance and creditors’ claims, granted relief measures to lessees, borrowers, and property buyers, and swiftly addressed the settlement of special claims.

The PDIC reiterated its commitment to deliver value-added services to its clients and stakeholders and to fulfill its core mandates as deposit insurer and statutory receiver of closed banks with operational excellence to protect the depositing public and promote financial stability.*PR

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