BSP shuts down Batangas-based Tiaong Rural Bank

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) ordered the closure of Tiaong Rural Bank, Inc., a Batangas based bank and the sixth problematic bank to be shut down this year.

The BSP’s Monetary Board issued Resolution No. 1240, which will keep the rural bank from doing business in the country under the New Central Bank Act.

The Philippine Deposit Insurance Corporation (PDIC) was designated as receiver and directed to perform the takeover and liquidation processes.

The latest available records for Tiaong Rural Bank as of June 30, 2018 said the bank had 18,471 deposit accounts, with total deposit liabilities of P891.7 million. Total insured deposites were P794.2 million, equivalent to 89.1% of the total deposits.

The PDIC assured depositors all valid deposits and claims would be paid up to a maximum deposit insurance coverage of P500,000. The PDIC added invidual depositors with valid deposit accounts having balances of P100,000 and below will be eligible for early payment, and will not need to file deposit insurance claims, provided they have no outstanding obligations.

Problematic banks

Aside from Tiaong Rural Bank, 5 other banks have been closed this year.

These are Iloilo-based Bangko Buena Consolidated Inc., Batangas-based Women’s Rural Bank Inc., Rural Bank of Initao (Misamis Oriental) Inc., Empire Rural Bank Inc. in Lipa City, Batangas, and the Rural Bank of Loreto (Surigao del Norte) Inc.

Last year, the BSP ordered the 7 problematic banks to close. This was compared to 22 banks in 2016.

The government would continue to give incentives and encourage mergers and consolidations under the Consolidation Program for Rural Banks (CPRB) as a means of further strengthening the country’s banking system. – Rappler.com