BSP closes Cebu thrift bank

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) has ordered the closure of Metro-Cebu Public Savings Bank, bringing to five the number of problematic banks shuttered this year.

BSP Deputy Governor Chuchi Fonacier said the central bank’s Monetary Board issued Resolution 434.E last March 31 prohibiting the Metro-Cebu Public Savings Bank from doing business in the Philippines as mandated under Republic Act 7653 or the Central Bank Act, as amended.

Fonacier said state-run Philippine Deposit Insurance Corp. (PDIC) has been designated as receiver and has been directed to proceed with the liquidation of the problematic thrift bank in accordance with RA 3591 or the PDIC Charter.

The Metro-Cebu Public Savings Bank is the third bank ordered closed by the central bank in March after the Rural Bank of Mahaplag (Leyte) Inc. and the Rural Bank of Salcedo (Ilocos Sur) Inc.

The BSP also ordered the closure of the Rural Bank of San Lorenzo Ruiz (Siniloan) Inc. in February and the Rural Bank of San Nicolas (Pangasinan) Inc. in January.

PDIC took over the closed thrift bank and all its branches, assets, and records last April 1. The Metro-Cebu Public Savings Bank has a branch at the Gee Ann Square Mall in Talisay, Cebu and another one in Lapu-Lapu City also in Cebu.

Under its charter, a bank placed under liquidation shall in no case be re-opened and permitted to resume banking business.

Furthermore, the law also expressly provides that banks closed by the Monetary Board shall no longer be rehabilitated.

“Be further informed that 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,” PDIC said.

The state-insurer said 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 receiver and to immediately turn over the said assets and records to the designated deputy receiver.

The number of problematic banks ordered closed by the central bank almost tripled to 13 last year from five in 2020 as the country has yet to fully recover from the impact of the COVID-19 pandemic.

This brought to 23 the number of closed banks since the onset of the global health crisis in 2020.

To strengthen the sector, the central bank has rolled out of the Rural Bank Strengthening Program (RBSP) to enhance the operations, capacity, and competitiveness of the industry.

“We believe that the RBSP is necessary to boost the resilience of ruralbanks amid the evolving challenges in the banking system and to enhance their role in promoting inclusive growth,” BSP Governor Benjamin Diokno earlier said.