Other Regulatory Bodies

• PHILIPPINE DEPOSIT INSURANCE CORPORATION (PDIC) is a government instrumentality created in 1963 by virtue of Republic Act 3591 to insure the deposits of all banks
• Deposit Insurance


  PDIC provides a maximum deposit insurance coverage of PHP500,000 per depositor per bank
• Examination and Resolution


  PDIC works closely with the Bangko Sentral ng Pilipinas (BSP) to help maintain stability in the banking system, PDIC is authorized to issue regulations, conduct bank examinations and investigations, and extend financial assistance to eligible distressed banks

  
• Receivership and Liquidation


  PDIC is the statutory receiver and liquidator of closed banks, administers their assets, records and affairs, and manages and preserves these assets for the benefit of the closed banks' creditors
• Insurable deposit


  Entire deposits aggregated value of a depositor, including their calculated interest as per the assessment or bankruptcy declaration day of scheme member subject, unless in case of exemptions defined as per the Law "On deposit insurance"
• Insured deposit


  Amount due to any depositor for deposits in an insured bank net of any obligation of the depositor to the insured bank as of the date of closure, but not to exceed the Maximum Deposit Insurance Coverage
• Single account


  Account maintained solely by a depositor (natural person or juridical entity/organization), In-Trust-For (ITF) and By Accounts are also considered single accounts
• Joint account


  Account held jointly by two or more natural persons, or by two or more juridical persons or entities, insured separately from any single or singly-owned deposit account
• Membership of banks to PDIC is mandatory; hence, all operating banks are members of PDIC
• Types of deposits insured by PDIC


  • Deposits of all commercial banks, savings and mortgage banks, rural banks, private development banks, cooperative banks, savings and loan associations, as well as branches and agencies in the Philippines of foreign banks and all other corporations authorized to perform banking functions in the Philippines
  • Deposits in branches and subsidiaries of foreign banks licensed by the Bangko Sentral ng Pilipinas (BSP) to perform banking functions in the Philippines
  • Foreign currency deposits
• Exclusions from deposit insurance coverage under R.A. No. 9576


  • Bank losses due to theft, fire, closure by reason of strike or existence of public disorder, revolution or civil war
  • Investment products such as bonds, securities and trust accounts
  • Deposit accounts which are unfunded, fictitious or fraudulent
  • Deposit products constituting or emanating from unsafe and unsound banking practices
  • Deposits that are determined to be proceeds of an unlawful activity as defined under the Anti-Money Laundering Law
• Insurance premium is paid by the banks, not by the depositors. The bank is assessed 1/5 of 1% per annum of the assessment base of the bank
• Deposits in different banking institutions are insured separately. However, if a bank has one or more branches, the main office and all branch offices are considered as one bank
• Maximum Deposit Insurance Coverage


  Effective June 1, 2009, the maximum deposit insurance coverage is P500,000 per depositor per bank
• PDIC may propose to adjust the MDIC, subject to the approval of the President of the Philippines, in case of a condition that threatens the monetary and financial stability of the banking system that may have systemic consequences
• Anti-Money Laundering Council (AMLC)


  Composed of the Governor of the BSP as Chairperson, and the Commissioner of the IC and the Chairperson of the SEC, as Members
• Money Laundering


  A crime whereby the proceeds of an unlawful activity are transacted, thereby making them appear to have originated from legitimate sources
• Functions of the Anti-Money Laundering Council


  • Require and receive covered or suspicious transaction reports from covered persons
  • Issue orders to investigate, or request for assistance from a foreign State
  • Institute civil forfeiture proceedings
  • File complaints with the Department of Justice or the Office of the Ombudsman for the prosecution of money laundering offenses and other violations under the AMLA
  • Investigate suspicious transactions and covered transactions deemed suspicious after investigation
  • File with the Court of Appeals, ex parte, through the Office of the Solicitor General a petition for the freezing of any monetary instrument or property that is in any way related to an unlawful activity or an application for authority to inquire into or examine any particular deposit or investment, including related accounts, with any banking institution or nonbank financial institution
  • Formulate and implement such measures
  • Receive and take action in respect of any request from foreign states for assistance
  • Develop educational programs
  • Enlist the assistance of any branch, department, bureau, office, agency or instrumentality of the government, including government-owned and -controlled corporations
  • Impose administrative sanctions
  • Require the Land Registration Authority and all its Registries of Deeds to submit to the AMLC, reports on all real estate transactions involving an amount in excess of Five Hundred Thousand Pesos (P500,000.00)
• To file with the Court of Appeals, ex parte, through the Office of the Solicitor General


  1. Petition for the freezing of any monetary instrument or property that is in any way related to an unlawful activity

  2. Application for authority to inquire into or examine any particular deposit or investment, including related accounts, with any banking institution or nonbank financial institution
• Covered Persons


  • Persons supervised or regulated by BSP
  • Persons supervised or regulated by IC
  • Persons supervised or regulated by SEC
  • Designated Non-Financial Businesses and Professions (DNFBPs)
• Customer Identification Requirements – KYC (Know Your Customer Rule)


  Covered institutions shall: Establish and record the true identity of their clients based on official documents, Maintain a system of verifying the true identity of individual clients, Require a system verifying the legal existence and organizational structure of corporate clients, as well as the authority and identification of all persons purporting to act on their behalf, Establish appropriate systems and methods based on internationally compliant standards and adequate internal controls for verifying and recording the true and full identify of their customers
• Record Keeping


  All records of all transactions of covered institutions shall be maintained and safely stored for five (5) years from the date of transactions, Records on customer identification, account files and business correspondence for closed accounts shall be preserved and safely stored for at least five (5) years from the date when they were closed
• Covered transaction


  A transaction in cash or other equivalent monetary instrument exceeding Five Hundred Thousand pesos (Php500,000.00), A transaction exceeding One Million pesos (Php1,000,000.00) in cases of jewelry dealers, dealers in precious metals and dealers in precious stones
• Lawyers and accountants acting as independent legal professionals in relation to information concerning their clients or where disclosure of information would compromise client confidences or the attorney-client relationship are not considered covered persons
• Suspicious transactions


  • Transactions with no underlying legal or trade obligation, purpose or economic justification
  • Transactions where the client is not properly identified
  • Transactions where the amount involved is not commensurate with the business or financial capacity of the client
  • Transactions that may be perceived as structured to avoid reporting requirements
  • Transactions that deviate from the profile of the client and/or the client's past transactions
  • Transactions related to an unlawful activity or offense
  • Transactions similar or analogous to the above
• Transaction Reporting


  Covered persons shall report to the AMLC all covered transactions and suspicious transactions within five (5) working days, unless the AMLC prescribes a different period not exceeding fifteen (15) working days, from the occurrence thereof, For suspicious transactions, "occurrence" refers to the date of determination of the suspicious nature of the transaction, which determination should be made not exceeding ten (10) calendar days from the date of transaction, If the transaction is related to an unlawful activity or money laundering offense, the 10-day period is reckoned from the date the covered person knew or should have known the suspicious transaction indicator
• Confidentiality of Reporting


  Any information about such reporting shall not be published or aired, in any manner or form, by the mass media, or through electronic mail, or other similar devices, Violation will result in criminal liability for the concerned officer, employee, of the covered person and media
• Safe Harbor Provision


  No administrative, criminal or civil proceedings shall lie against any person for having made a covered transaction or suspicious transaction report in the regular performance of his duties and in good faith, whether or not such reporting results in any criminal prosecution
• Bank Inquiry with Court Order


  The AMLC may only inquire into bank deposits upon order of the court when there is probable cause that the bank deposits are related to the crime or unlawful activities, A court order is not necessary when the offense or unlawful activity involved is kidnapping for ransom, drugs, hijacking, destructive arson and murder, including those perpetrated by terrorists against non-combatant persons and similar targets