BSP orders closure of San Fernando Rural Bank

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) has ordered the closure of a Pampanga-based rural bank as part of continuing efforts to protect depositors by weeding the industry of weak players.

The Monetary Board issued Resolution 1514.A last week prohibiting San Fernando Rural Bank Inc. under the name and style of Safer Bank, A Rural Bank from doing business in the Philippines.

This is the second rural bank ordered closed since the entire Luzon was placed under enhanced community quarantine in the middle of March to prevent the spread of  COVID-19.

This is also the fourth rural bank shuttered by the BSP after the closure of De La O Rural Bank Inc. on Sept. 10, Rural Bank of Tibiao (Antique) Inc. on March 5 and Cagayan-based Providence Rural Bank Inc. on  Feb. 27.

State-run Philippine Deposit Insurance Corp. (PDIC) also took over as receiver of the Safer Bank last Thursday.

The closed rural bank has an office address in Safer Bank Building, Consunji Street, Barangay Sto. Rosario, San Fernando City in Pampanga. It also operates one branch lite unit at CGM Building along MacArthur Highway in Barangay Sindalan.

The PDIC Charter provides in Section 13, that a bank placed under liquidation shall in no case be re-opened and permitted to resume banking business. Furthermore, Section 12 expressly provides that banks closed by the Monetary Board shall no longer be rehabilitated.

Upon placement of the bank under liquidation, the powers, functions and duties of the directors, officers and stockholders of the bank are terminated.

Accordingly, the directors, officers, and stockholders shall be barred from interfering in any way with the assets, records and affairs of the bank.

Likewise, anyone in possession of any asset and records of the closed bank is advised not to allow or honor any transaction affecting the same without the consent of the PDIC and to immediately turnover the said assets and records to the designated deputy receiver.

In 2019, the BSP ordered the closure of 11 ailing banks including Maximum Savings Bank, AMA Rural Bank of Mandaluyong, Rural Bank of Lemery, Rural Bank of Larena (Siquijor), East Coast Rural Bank of Hagonoy, Rural Bank of Guihulngan (Negros Oriental), Rural Bank of Basey (Samar), Valiant Bank.

The Palawan Bank (Palawan Development Bank), Rural Bank of Mabitac (Laguna), and Bagong Bangko Rural ng Malabang (Lanao del Sur).