Rama pushes creation of info center by banks

CEBU - Acting Cebu City Mayor Michael Rama has suggested that there should be an information center to answer queries from the worried bank depositors of rural banks that have declared a holiday.

 “Bank holiday” is the term used by the bankers if a bank voluntarily suspends its usual operations.

Rama called an urgent meeting with the officials of the Bangko Sentral ng Pilipinas (BSP), Cebu Bankers Club and Cebu Chamber of Commerce and Industry (CCCI) to discuss the declaration of bank holiday by some rural banks.

BSP regional director Lorenzo Zafico told Rama that they are still conducting an investigation into the declaration of bank holiday.

Rama insisted that the officials of the BSP in Manila should give us an update of their investigation, because if they will choose to keep it under wraps it will cause worry to the depositors.

The proposed information center is to be composed of representatives from the BSP, bankers, media, City Hall officials and representatives of the concerned banks.

The usual procedures is that the Monetary Board of the BSP will place a particular bank under receivership of the Philippine Deposit Insurance Corporation once the bank fails to meet withdrawals of its depositors.

Republic Act 7653 or the New Central Bank Act provides that the Monetary Board may place a bank in receivership and liquidation of the bank is unable to pay its liabilities or the bank has insufficient realizable assets as determined by the BSP. — Rene U. Borromeo/NLQ (THE FREEMAN)