THE BANGKO SENTRAL ng Pilipinas’ (BSP) policy-setting body has banned a rural bank from doing business in the country.
In a circular letter dated June 6, the BSP said the Monetary Board (MB) has decided to prohibit Rural Bank of Cuyo (Palawan), Inc. from doing business in the Philippines pursuant to Section 30 of Republic Act (RA) No. 7653 or the New Central Bank Act, as amended.
Section 30 of the New Central Bank Act is focused on proceedings regarding receivership and liquidation.
“The Philippine Deposit Insurance Corp. (PDIC) has been designated as receiver with a directive to proceed with the takeover and liquidation of the aforementioned rural bank in accordance with Section 12 (a) of RA No. 3591 (PDIC Charter), as amended,” it said.
In a separate press release, the PDIC said that it took over the bank on June 10.
The agency said that “all valid deposits and claims will be paid up to the maximum deposit insurance coverage of P500,000 per depositor.”
Meanwhile, those with valid deposits with balances of P500,000 and below and have no outstanding obligations are not required to file deposit insurance claims.
“Borrowers are likewise reminded to continue paying their loan obligations with the closed Rural Bank of Cuyo (Palawan), Inc. and to transact only with designated PDIC representatives,” the state deposit insurer added.
Rural Bank of Cuyo’s head office is located in Cuyo, Palawan. It also has a branch lite unit in Subic Bay, Zambales.
The PDIC said latest records show the bank had 1,758 deposit accounts as of March 31.
The rural lender’s total deposit liabilities stood at P123.4 million, of which the bulk (78.7%) were insured deposits.
As of March 27, the bank was on the list of the Anti-Money Laundering Council-registered BSP-supervised entities, the PDIC added.
Meanwhile, the BSP, in a separate circular letter dated June 10, said the MB has canceled the license of a money changer.
The Monetary Board “approved the cancellation of the BSP registration of Foreignex, Inc. to operate as a money changer/foreign exchange dealer,” according to the central bank’s circular letter.
The central bank said this came on the basis of a “gross violation” of the provisions and requirements of the Manual of Regulation for Non-Bank Financial Institutions (MORNBFI).
It also cited a violation of deed of undertaking executed pursuant to Section 901-N of the MORNBFI. — Luisa Maria Jacinta C. Jocson
MB orders closure of rural bank, revokes money changer’s license
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