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    PDIC

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    kelalviola
    Notes for PDIC

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    PDIC

    Uploaded by

    kelalviola
    1 views2 pages
    Notes for PDIC

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    © © All Rights Reserved

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    Notes for PDIC

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    1 views2 pages

    PDIC

    Uploaded by

    kelalviola
    Notes for PDIC

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    Philippine Deposit Insurance Corporation (PDIC)

    1. Overview

     The PDIC is a government-owned and controlled corporation (GOCC) established under Republic
    Act No. 3591 in 1963.

     Its primary role is to protect small depositors and promote confidence in the Philippine
    banking system.

     PDIC operates under the Department of Finance.

    2. Functions and Responsibilities

     Deposit Insurance: PDIC insures bank deposits up to a maximum amount, currently PHP 500,000
    per depositor, per bank.

     Deposit Protection: PDIC’s coverage includes savings accounts, checking accounts, and other
    deposit accounts in insured banks.

     Bank Liquidation: When a bank is closed by the Bangko Sentral ng Pilipinas (BSP), PDIC is
    responsible for liquidating the bank and distributing the proceeds to creditors, including insured
    depositors.

     Bank Supervision and Resolution: PDIC works closely with the BSP to monitor banks' health and
    resolve issues that could lead to bank closure.

    3. Deposit Insurance Coverage

     PDIC insures all types of deposits in insured banks (savings, time, checking accounts) up to PHP
    500,000.

     In cases where deposit amounts exceed this limit, only PHP 500,000 is guaranteed, but
    additional recoveries may be available through liquidation.

     For joint accounts, coverage can go beyond PHP 500,000, depending on the account
    arrangements and the number of co-depositors.

    4. Claims and Payout Process

     When a bank fails, PDIC notifies depositors about how to claim their insured deposits.

     PDIC sets up claims payout schedules to facilitate the orderly distribution of insurance payments
    to affected depositors.

     Depositors must provide necessary identification and documents to receive their insured funds.

    5. Funding and Sources of Revenue

     PDIC is funded through insurance premiums collected from member banks, investment income,
    and, if necessary, through government support.
     PDIC member banks pay a semi-annual insurance premium based on their total deposit
    liabilities.

    6. Benefits of PDIC

     Depositor Protection: Provides assurance to depositors that their money is secure up to the
    insured limit.

     Banking Stability: Promotes stability and confidence in the banking sector, encouraging people
    to keep their money in banks rather than informal channels.

     Resolution of Bank Failures: Helps reduce potential financial disruptions caused by bank
    closures.

    7. Limitations

     PDIC does not cover investment products like mutual funds or insurance plans offered by banks.

     Deposits in closed banks above PHP 500,000 are only partially covered and may be subject to
    claims in the bank's liquidation process.

    8. Recent Developments

     PDIC continues to work on improving its efficiency in paying out claims, enhancing customer
    service, and increasing the insured deposit amount when necessary to reflect inflation and
    deposit growth in the banking system.

    PDIC plays a vital role in fostering trust in the financial system, especially among small depositors, by
    ensuring a reliable safety net in case of bank insolvencies.

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