The bill, authored by Lapus, seeks to raise the deposit insurance amount for each depositor from P100,000 to P200,000 with a provision for an automatic review and adjustment every five years. It also seeks to provide continuous PDIC isnruance cover to all banks for as long as these are allowed to accept deposits – that is, even if they default in premium payments.
The bill passed third reading in the 11th Congress and has gone through scrutiny and revisions by PDIC, the Bangko Sentral ng Pilipinas (BSP), Bankers Association of the Philippines and Congress. Unfortunately, the Senate failed to pass the required counterpart bill for lack of time.
Lapus said that bank capitalization in the Philippines pales in comparison to the rest of the Asian region and is not widely distributed to the public as in developed markets. The greater danger in the collapse of banks is inadequacy of depositor-protection.
The existing P100,000 per depositor limit was set in 1992. If adjusted for inflation and devaluation, such amount would closer to P300,000 at today’s real terms.
The total volume of the deposits stood at P2.3 trillion in 2001 which represented quantum increases since 1992. PDIC collects 1/5 of one percent on total amounts of deposits but its liability is limited only to a maximum of P100,000 per depositor.