PDIC to pay depositors of closed Abra rural bank

MANILA, Philippines – The Philippine Deposit Insurance Corp. (PDIC) will start paying next week the depositors of a rural bank in Abra that was closed by the Bangko Sentral ng Pilipinas (BSP).

The BSP Monetary Board ordered the closure of Rural Bank of Villaviciosa Inc. under Resolution 4 issued on Jan. 7.

The PDIC, which took over the bank on Jan. 8, said all bank records are being verified and validated.

All valid deposits will be paid up to the maximum deposit insurance coverage of P500,000, it said.

Depositors with balances of P100,000 and below shall be eligible for early payment and need not file deposit insurance claims, the PDIC said.

The PDIC said it would start processing the claims of those with bigger deposits before the end of the month.

The agency is set to hold a depositors-borrowers forum on Jan.18.

Among the bank’s major shareholders are Jose Lagen Jr. with 34.78 percent; Daisy Lagen, 31.77 percent; Land Bank of the Philippines, 13.34 percent; and Luisa Sotelo, 5.09 percent.

Records show the rural bank had 173 accounts, with deposit liabilities amounting to P2.3 million.

The Abra rural bank was the first to be closed this year. Last year, the BSP closed 14 rural banks.

BSP Governor Amando Tetangco Jr. said they would continue to offer incentives to allow weaker banks to consolidate, merge and beef up their capital.