The Philippine Deposit Insurance Corp. (PDIC) is now reviewing the new rehabilitation program proposal of Banco de Oro Unibank (BDO) for the closed Export and Industry Bank (EIB).
In a statement, the state deposit insurer said the proposal had “certain conditions”, thus, the agency “is reviewing the legal and economic viabilities of said proposal.”
“Some of the conditions as proposed are not within the authority of PDIC,” it said.
PDIC said that as a receiver, the agency had 90 days to “determine the rehabilitation proposal that is most advantageous to depositors, creditors and taxpayers.”
It also plans to “come up with a terms of reference for all interested parties to consider as well as engage the services of a financial auditor to help PDIC determine the valuation of Export & Industry Bank (EIB).”
“These will be submitted to the PDIC Board and the Monetary Board that will ultimately approve the rehabilitation proposal,” it said.
“The immediate concern now is to take stock of the deposit liabilities of EIB and conduct payout for all valid insured deposits as soon as possible,” it said.
PDIC said EIB account holders who have complete information on the bank’s record, have account amounting not more than P10,000 and have no outstanding loan with the bank, woulad start to receive the deposit insurance by the end of this month.
On the other hand, servicing for account holders with more than P10,000 deposits is expected to start “no later than end of June 2012.”
The Bangko Sentral ng Pilipinas (BSP) placed EIB under PDIC receivership on April 26, 2012 after EIB officials requested the central bank to take over the bank’s operations due to insolvency issue.
EIB, which as of December last year has about 50,092 accounts, sent a letter to BSP to inform monetary officials that the commercial bank, which is listed with the Philippine Stock Exchange (PSE), will declare a bank holiday on April 27, 2012.
EIB is a 50-unit bank with head office in Exportbank Plaza, Chino Roces Avenue corner Sen. Gil Puyat Avenue, Makati City. As of December 31, 2011, the bank has total deposit liabilities of P15.98 billion.
Despite EIB’s closure, the BSP said the country’s banking system “remains sound and stable with ample liquidity and high level of capitalization.”
“The closure of EIB is not expected to adversely affect the Philippine banking system considering its relatively small size. Its total assets is equivalent to only about 0.3 percent of the total assets of the banking system,” the BSP said in a statement.