June 12, 2024 - The Bangko Sentral ng Pilipinas (BSP) has ordered the closure of Rural Bank of Cuyo (Palawan) Inc., effective June 10, Philippine Deposit Insurance Corporation (PDIC) announced in a statement.
The Monetary Board (MB) issued MB Resolution No. 631.C dated June 6, 2024, prohibiting the Rural Bank of Cuyo (Palawan) Inc. from doing business in the Philippines. The resolution also directed the PDIC, as Receiver, to proceed with the takeover and liquidation of the bank.
This move comes after the BSP identified the bank as having failed to comply with regulatory requirements, putting depositors' money at risk. The BSP did not disclose the nature of the compliance failures.
The PDIC has assured depositors that they will be protected. All valid deposits and claims will be paid up to the maximum deposit insurance coverage of P500,000.00 per depositor. This means that depositors with balances of P500,000.00 and below will be fully reimbursed for their deposits, as long as they have no outstanding obligations or have not acted as co-makers of loans with the bank. These depositors will not be required to file any deposit insurance claims.
However, depositors with balances exceeding P500,000.00 will only be reimbursed for the insured amount. They will need to file deposit insurance claims with the PDIC to receive their money. The PDIC will be announcing the process for filing claims in the coming days.
The closure of Rural Bank of Cuyo (Palawan) Inc. is likely to have a significant impact on the local community, particularly small businesses that rely on the bank for their financial needs. The PDIC has assured borrowers that they will be contacted soon to discuss arrangements for repaying their loans.
To help depositors and borrowers understand the closure process and their rights, the PDIC will be holding a Depositors-Borrowers’ Forum on June 26, 2024. Depositors and borrowers are encouraged to attend the forum to get more information.
This incident highlights the importance of choosing a well-regulated bank to ensure the safety of your deposits. Depositors are advised to check if their bank is a member of the PDIC and to familiarize themselves with deposit insurance coverage limits.