Another troubled bank gets closure order from BSP

The Bangko Sentral ng Pilipinas (BSP) has closed down another problematic bank, bringing to four the number of financial institutions shuttered last month and seven so far this year.

The central bank’s Monetary Board issued MB Resolution 802 last Thursday prohibiting East Coast Rural Bank of Hagonoy Inc. from doing business in the Philippines and placing it under the supervision of the state-run Philippine Deposit Insurance Corp.

East Coast Rural Bank of Hagonoy is a single-unit rural bank located at HRBI Compound, G. Panganiban St., Brgy. Santo Niño Hagonoy, Bulacan.

Latest available records showed EastCoast Rural Bank of Hagonoy has 1,412 deposit accounts with total deposit liabilities of P122 million as of the end of March, of which 91.36 percent or P111.4million are insured deposits.

PDIC assured depositors that all valid deposits and claims shall be paid up to the maximum deposit insurance coverage of P500,000. Individual account holders of valid deposits with balances of P100,000 and below do not need to file deposit insurance claims, provided they have no outstanding obligations or have not acted as co-makers of obligations.

Other banks closed down in May include the Rural Bank of Guihulungan (Negros Oriental), Rural Bank of Basey (Samar) and Iloilo-based Valiant Bank Inc.

Banks also ordered closed by the central bank this year include Puerto Princesa-based Palawan Bank, Rural Bank of Mabitac (Laguna) and Bagong Bangko Rural ng Malabang (Lanao del Sur).

Last year, BSP closed down 12 problematic banks.

The government continues to provide incentives under the Consolidation Program for Rural Banks to encourage mergers and consolidations among small banks, particularly rural banks, to further strengthen and enhance the viability of the banking system.