PDIC Depositor Awareness Program  for Overseas Filipino Workers Understanding Deposit Insurance Ms. Maria Leonida Fres-Fel...
“ A good provider is one who leaves…” New York Times Magazine April 22, 2007
 
‘ Italian Village’
Some OFW deployment statistical data <ul><li>For 2006, remittances through banks reached $12.8B and $1.2B through informal...
Economic impact of Philippine labor exports <ul><li>Reduction of domestic unemployment </li></ul><ul><li>Source of public ...
Remittance allocation <ul><li>Payment of debts </li></ul><ul><li>Basic household expenses </li></ul><ul><li>Purchase of ap...
Remittance allocation
Remittance flow <ul><li>Formal and regulated </li></ul><ul><ul><li>banks </li></ul></ul><ul><ul><li>money transfer agencie...
Remittance channels 69% of the respondents in the nationwide NSO Survey on Overseas Filipinos in 2005 regularly send remit...
Gov’t agencies concerned with OFWs <ul><li>DOLE, OWWA, POEA, DFA and financial regulators such as </li></ul><ul><li>the Ba...
Gov’t agencies concerned with OFWs <ul><li>DOLE, OWWA, POEA, DFA and financial regulators such as </li></ul><ul><li>the Ba...
PDIC signages
Corporate profile Philippine Deposit Insurance Corporation <ul><li>government agency </li></ul><ul><li>created in 1963 by ...
To protect depositors and help strengthen public confidence in the stability of the banking system. Corporate mandate
1963 -  P 10,000 1978 -  15,000 1984 -  40,000 1992 -  100,000 2004 -  250,000 MDIC increases
PDIC Profile       Other DIs   <ul><li>  </li></ul><ul><li>NOTES:  </li></ul><ul><li>  </li></ul><ul><li>Data culled from ...
<ul><li>Board of Directors </li></ul><ul><li>(as of Dec.31, 2005) </li></ul>Upper Row, from left to right: PDIC President ...
PDIC Profile       Other DIs   <ul><li>  </li></ul><ul><li>NOTES:  </li></ul><ul><li>  </li></ul><ul><li>Data culled from ...
<ul><li>Insurance and assessment collection </li></ul><ul><li>Premium assessment rates: </li></ul><ul><li>  </li></ul><ul>...
Functions <ul><li>Claims settlement </li></ul><ul><li>-  Processing and settlement of claims for insured  deposits of up t...
<ul><li>Receivership and liquidation  </li></ul><ul><li>- Inventory and preservation of assets, records and    affairs of ...
NOTE:  PDIC has to determine that the costs of actual payout and liquidation of the banks in danger of closing will be mor...
Functions <ul><li>Risk assessment and management:  </li></ul><ul><li>- Offsite monitoring of financial condition of member...
Functions <ul><li>Bank examination and investigation  </li></ul><ul><li>- Onsite examination of member banks with prior   ...
PDIC Profile       Other DIs   <ul><li>  </li></ul><ul><li>NOTES:  </li></ul><ul><li>  </li></ul><ul><li>Data culled from ...
MDIC under Section 4(g) of RA 9302 <ul><li>All deposits in the bank maintained in the same right and </li></ul><ul><li>cap...
Claims settlement <ul><li>Illustrative case </li></ul><ul><li>- Jose P300,000 </li></ul><ul><li>- Jose and Pilar     400,0...
The computation will be as follows: Claims settlement * Excess after consolidating Jose’s shares in the three joint accoun...
The computation will be as follows: Claims settlement * Excess after consolidating Jose’s shares in the three joint accoun...
<ul><li>June 16-22: Depositor  </li></ul><ul><li>Protection and Awareness Week </li></ul><ul><li>(Proclamation No. 358, Ap...
Depositor Protection <ul><li>- Hanging of streamers  </li></ul><ul><li>by banks </li></ul><ul><li>Newspaper supplements </...
Depositor Protection <ul><li>Depositor’s Assistance Bureau. PDIC’s response action desk that attends to queries and compla...
<ul><li>Depositors Assistance Bureau’s communication facilities: </li></ul><ul><li>Website: www.pdic.gov.ph </li></ul><ul>...
Information and education activities <ul><li>Conducting informal meetings/forum during takeover  </li></ul><ul><li>of clos...
Information and education activities <ul><li>Production of multimedia information tools </li></ul>
“ The depositor’s vigilance in trying to get as much information about his bank and the banking industry is  still the bes...
MARAMING SALAMAT!
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Understanding Deposit Insurance

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a Presentation by Philippine Deposit Insurance Corporation (PDIC) at the BSP Regional Financial Literacy Campaign for OFWs in Bacolod City, Philippines on June 28, 2007

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  • Understanding Deposit Insurance

    1. 1. PDIC Depositor Awareness Program for Overseas Filipino Workers Understanding Deposit Insurance Ms. Maria Leonida Fres-Felix Vice President Communication and Stakeholder Relations Group Philippine Deposit Insurance Corporation
    2. 2. “ A good provider is one who leaves…” New York Times Magazine April 22, 2007
    3. 4. ‘ Italian Village’
    4. 5. Some OFW deployment statistical data <ul><li>For 2006, remittances through banks reached $12.8B and $1.2B through informal channels. </li></ul><ul><li>Average remittances of nearly $15B a year, comprising nearly 10.9 percent of GDP </li></ul>
    5. 6. Economic impact of Philippine labor exports <ul><li>Reduction of domestic unemployment </li></ul><ul><li>Source of public income (from pre-departure fees) </li></ul><ul><li>Improvement of foreign exchange reserves </li></ul>
    6. 7. Remittance allocation <ul><li>Payment of debts </li></ul><ul><li>Basic household expenses </li></ul><ul><li>Purchase of appliances/furniture </li></ul><ul><li>Children’s education </li></ul><ul><li>Capital for business </li></ul><ul><li>Purchase of land, house and lot </li></ul><ul><li>Personal cash savings </li></ul>
    7. 8. Remittance allocation
    8. 9. Remittance flow <ul><li>Formal and regulated </li></ul><ul><ul><li>banks </li></ul></ul><ul><ul><li>money transfer agencies </li></ul></ul><ul><ul><li>door-to-door </li></ul></ul><ul><li>Informal and unregulated </li></ul><ul><ul><li>- padala (through friends, co-workers, relatives, etc.) </li></ul></ul><ul><ul><li>-inserted in mails, cargoes, etc. </li></ul></ul>
    9. 10. Remittance channels 69% of the respondents in the nationwide NSO Survey on Overseas Filipinos in 2005 regularly send remittances through banks or other regulated channels. Mode % of Total Cash 92 Formal (banks & non-banks) 69 Informal channels 23 Non-cash 8 Source: 2005 NSO Survey on Overseas Filipinos
    10. 11. Gov’t agencies concerned with OFWs <ul><li>DOLE, OWWA, POEA, DFA and financial regulators such as </li></ul><ul><li>the Bangko Sentral ng Pilipinas (BSP) and the Philippine </li></ul><ul><li>Deposit Insurance Corporation (PDIC) can initiate programs on: </li></ul><ul><ul><ul><li>financial literacy </li></ul></ul></ul><ul><ul><ul><li>consumer awareness </li></ul></ul></ul><ul><ul><ul><li>savings mobilization </li></ul></ul></ul>
    11. 12. Gov’t agencies concerned with OFWs <ul><li>DOLE, OWWA, POEA, DFA and financial regulators such as </li></ul><ul><li>the Bangko Sentral ng Pilipinas (BSP) and the Philippine </li></ul><ul><li>Deposit Insurance Corporation (PDIC) can initiate programs on: </li></ul><ul><ul><ul><li>financial literacy </li></ul></ul></ul><ul><ul><ul><li>consumer awareness </li></ul></ul></ul><ul><ul><ul><li>savings mobilization </li></ul></ul></ul>
    12. 13. PDIC signages
    13. 14. Corporate profile Philippine Deposit Insurance Corporation <ul><li>government agency </li></ul><ul><li>created in 1963 by virtue of RA 3591 </li></ul>
    14. 15. To protect depositors and help strengthen public confidence in the stability of the banking system. Corporate mandate
    15. 16. 1963 - P 10,000 1978 - 15,000 1984 - 40,000 1992 - 100,000 2004 - 250,000 MDIC increases
    16. 17. PDIC Profile       Other DIs   <ul><li>  </li></ul><ul><li>NOTES: </li></ul><ul><li>  </li></ul><ul><li>Data culled from the following sources: Responses to e-mail inquiries, the International Deposit Insurance Survey of Canada Deposit Insurance Corporation posted on IADI webpage (as of 2001-03), and available data from respective websites of DI members or their central banks, for data on the total assets of the banking sector/or insured banks (as in the case of FDIC) </li></ul><ul><li>  </li></ul><ul><li>For Korea, supervision of financial system is integrated. DI covers securities, life and non-life insurance, and mutual funds. Data under total assets of banks is actually total bank deposits. </li></ul><ul><li>  </li></ul><ul><li>  </li></ul><ul><li>  </li></ul>PDIC member banks PDIC has 862 member banks. As of December 2006: Deposit Insurer No. of Employees Functions Member Institutions Total Insured Deposits/ or Total # Insured Accounts Total Assets of Banks   PDIC       559 (as of September 30, 2006)   Deposit insurance premium collection; failure resolution through extending of loans, purchase of assets, assumption of liabilities, or putting deposits in the bank; mandatory receiver of closed banks; liquidation of closed bank’s assets; settlement of deposit insurance claims   871 (as of June 2006)   29,090,705/ 3,212,090   P4517.98B
    17. 18. <ul><li>Board of Directors </li></ul><ul><li>(as of Dec.31, 2005) </li></ul>Upper Row, from left to right: PDIC President and CEO Ricardo M. Tan (Vice-Chairman); Finance Secretary Margarito B. Teves (Chairman); BSP Governor Amando M. Tetangco, Jr. (Director); Lower Row, from left to right: BSP Deputy Governor Nestor A. Espenilla, Jr. (Alternate Director); Director Carmen De Venecia-Lim; Director Ruben D. Almendras; and Finance Undersecretary Gabriel R. Singson, Jr. Acting President Michael A. Osmeña Corporate profile
    18. 19. PDIC Profile       Other DIs   <ul><li>  </li></ul><ul><li>NOTES: </li></ul><ul><li>  </li></ul><ul><li>Data culled from the following sources: Responses to e-mail inquiries, the International Deposit Insurance Survey of Canada Deposit Insurance Corporation posted on IADI webpage (as of 2001-03), and available data from respective websites of DI members or their central banks, for data on the total assets of the banking sector/or insured banks (as in the case of FDIC) </li></ul><ul><li>  </li></ul><ul><li>For Korea, supervision of financial system is integrated. DI covers securities, life and non-life insurance, and mutual funds. Data under total assets of banks is actually total bank deposits. </li></ul><ul><li>  </li></ul><ul><li>  </li></ul><ul><li>  </li></ul><ul><li>Insurance assessment collection </li></ul><ul><li>Claims settlement </li></ul><ul><li>Receivership and liquidation </li></ul><ul><li>Failure resolution </li></ul><ul><li>Risk assessment and management </li></ul><ul><li>Bank examination and investigation </li></ul>Functions Deposit Insurer No. of Employees Functions Member Institutions Total Insured Deposits/ or Total # Insured Accounts Total Assets of Banks   PDIC       559 (as of September 30, 2006)   Deposit insurance premium collection; failure resolution through extending of loans, purchase of assets, assumption of liabilities, or putting deposits in the bank; mandatory receiver of closed banks; liquidation of closed bank’s assets; settlement of deposit insurance claims   871 (as of June 2006)   29,090,705/ 3,212,090   P4517.98B
    19. 20. <ul><li>Insurance and assessment collection </li></ul><ul><li>Premium assessment rates: </li></ul><ul><li> </li></ul><ul><li>-1992 to present – 1/5 of 1 percent </li></ul>Functions
    20. 21. Functions <ul><li>Claims settlement </li></ul><ul><li>- Processing and settlement of claims for insured deposits of up to Php250,000 per depositor. </li></ul>Insured deposit means the amount due to any depositor net of any obligation of the depositor to the bank as of date of closure.
    21. 22. <ul><li>Receivership and liquidation </li></ul><ul><li>- Inventory and preservation of assets, records and affairs of closed banks </li></ul><ul><li>- Conversion of loans and disposal of fixed assets into cash </li></ul><ul><li>- Processing of creditors’ claims </li></ul><ul><li>- Implementation of final settlement of claims </li></ul>Functions
    22. 23. NOTE: PDIC has to determine that the costs of actual payout and liquidation of the banks in danger of closing will be more expensive than the grant of financial assistance. Functions <ul><li>Failure resolution through: </li></ul><ul><li>- Extension of loans </li></ul><ul><li>- Purchase of assets </li></ul><ul><li>- Assumption of liabilities </li></ul>
    23. 24. Functions <ul><li>Risk assessment and management: </li></ul><ul><li>- Offsite monitoring of financial condition of member banks </li></ul><ul><li>- Identification of risk areas </li></ul><ul><li>- Institution of prompt corrective actions </li></ul>
    24. 25. Functions <ul><li>Bank examination and investigation </li></ul><ul><li>- Onsite examination of member banks with prior approval by the Monetary Board </li></ul>The revised PDIC CHARTER authorizes the Corporation to investigate banks for suspected anomalous and fraudulent actions detrimental to the depositing public.
    25. 26. PDIC Profile       Other DIs   <ul><li>  </li></ul><ul><li>NOTES: </li></ul><ul><li>  </li></ul><ul><li>Data culled from the following sources: Responses to e-mail inquiries, the International Deposit Insurance Survey of Canada Deposit Insurance Corporation posted on IADI webpage (as of 2001-03), and available data from respective websites of DI members or their central banks, for data on the total assets of the banking sector/or insured banks (as in the case of FDIC) </li></ul><ul><li>  </li></ul><ul><li>For Korea, supervision of financial system is integrated. DI covers securities, life and non-life insurance, and mutual funds. Data under total assets of banks is actually total bank deposits. </li></ul><ul><li>  </li></ul><ul><li>  </li></ul><ul><li>  </li></ul><ul><li>Insurance assessment collection </li></ul><ul><li>Claims settlement </li></ul><ul><li>Receivership and liquidation </li></ul><ul><li>Failure resolution </li></ul><ul><li>Risk assessment and management </li></ul><ul><li>Bank examination and investigation </li></ul>Functions Deposit Insurer No. of Employees Functions Member Institutions Total Insured Deposits/ or Total # Insured Accounts Total Assets of Banks   PDIC       559 (as of September 30, 2006)   Deposit insurance premium collection; failure resolution through extending of loans, purchase of assets, assumption of liabilities, or putting deposits in the bank; mandatory receiver of closed banks; liquidation of closed bank’s assets; settlement of deposit insurance claims   871 (as of June 2006)   29,090,705/ 3,212,090   P4517.98B
    26. 27. MDIC under Section 4(g) of RA 9302 <ul><li>All deposits in the bank maintained in the same right and </li></ul><ul><li>capacity shall be added together and covered up to P250,000. </li></ul><ul><li>A joint account regardless of conjunctions (a, and/or, and) shall be insured separately from individually-owned or single </li></ul><ul><li>account. </li></ul><ul><li>The MDIC of joint accounts shall be equally divided among the account owners. </li></ul><ul><li>The shares of an account owner in several joint accounts maintained in the same right and capacity shall be consolidated and subject to the MDIC of P250,000. </li></ul><ul><li>The aggregate of the interests of each co-owner over several joint accounts shall be subject to the MDIC. </li></ul>
    27. 28. Claims settlement <ul><li>Illustrative case </li></ul><ul><li>- Jose P300,000 </li></ul><ul><li>- Jose and Pilar 400,000 </li></ul><ul><li>- Jose and/or Pilar 250,000 </li></ul><ul><li>- Jose and/or Anita 300,000 </li></ul>
    28. 29. The computation will be as follows: Claims settlement * Excess after consolidating Jose’s shares in the three joint accounts under his name.
    29. 30. The computation will be as follows: Claims settlement * Excess after consolidating Jose’s shares in the three joint accounts under his name.
    30. 31. <ul><li>June 16-22: Depositor </li></ul><ul><li>Protection and Awareness Week </li></ul><ul><li>(Proclamation No. 358, April 4, </li></ul><ul><li>2003) </li></ul>Depositor Protection
    31. 32. Depositor Protection <ul><li>- Hanging of streamers </li></ul><ul><li>by banks </li></ul><ul><li>Newspaper supplements </li></ul><ul><li>TV appearances </li></ul>
    32. 33. Depositor Protection <ul><li>Depositor’s Assistance Bureau. PDIC’s response action desk that attends to queries and complaints of depositors and the general public. </li></ul><ul><li>- Provides information on queries about deposit insurance. </li></ul><ul><li>- Provides frontline depositor assistance during field operations. </li></ul>
    33. 34. <ul><li>Depositors Assistance Bureau’s communication facilities: </li></ul><ul><li>Website: www.pdic.gov.ph </li></ul><ul><li>Email: dab@pdic.gov.ph </li></ul><ul><li>Phone: 841-4631 (direct line) </li></ul><ul><li>841-4000 (trunk line) </li></ul><ul><li>841-4637 (telefax) </li></ul><ul><li>Mail and visit: The Depositors Assistance Bureau </li></ul><ul><li>6/F SSS Building </li></ul><ul><li>Ayala Avenue corner V.A. Rufino St. </li></ul><ul><li>Makati City </li></ul><ul><li>E-complaint form </li></ul>Depositor protection
    34. 35. Information and education activities <ul><li>Conducting informal meetings/forum during takeover </li></ul><ul><li>of closed banks </li></ul><ul><li>Assistance during filing of claims </li></ul><ul><li>Local and national media relations </li></ul><ul><li>Liaising with LGUs and NGOs </li></ul><ul><li>Production of multimedia information tools </li></ul>
    35. 36. Information and education activities <ul><li>Production of multimedia information tools </li></ul>
    36. 37. “ The depositor’s vigilance in trying to get as much information about his bank and the banking industry is still the best protection against loss of his deposit.” Vigilance is the best defense.
    37. 38. MARAMING SALAMAT!

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