Senator Juan Edgardo M. Angara has filed a bill to increase the insurance coverage provided by the Philippine Deposit Insurance Corp. (PDIC) to P1 million per depositor from P500,000.

On March 9 Mr. Angara filed Senate Bill No. 2089 which will amend provisions of Republic Act No. 3591 or the PDIC charter “to make it more responsive to the constantly changing financial landscape.”

“In order to further boost their confidence in the banking system, especially during these very challenging times, we are proposing to increase by 100% the deposit insurance coverage,” he said in a statement Friday.

Mr. Angara added that the amendments “further strengthen the mandate of PDIC, not only as the insurer of deposits but as liquidator of troubled banks.”

Mr. Angara said the number of fully-insured deposit accounts rose to 76.1 million in the first nine months of 2020 from 68.1 million a year earlier, citing data from the PDIC. About 96.7% of the 78.7 million total deposit accounts are fully insured.

Under the proposed measure, the maximum deposit insurance coverage will be subject to review by the PDIC’s board of directors every three years and may be increased depending on inflation or other economic indicators.

It also modifies some powers of the state deposit insurer to avoid overlap of functions with the central bank.

The modifications include powers of the PDIC in relation to bank resolution, including the grant of consent to mergers and acquisitions, and the issuance of cease and desist orders for deposit-related unsafe and/or unsound banking. These powers will be consolidated in the Bangko Sentral ng Pilipinas (BSP).

The PDIC will also be transferred from the Department of Finance to become a corporation attached to the BSP.

The measure also seeks to remove the PDIC’s exemption from the salary standardization scheme for government employees, aligning its pay structure with other government owned and controlled corporations (GOCCs) and other agencies. — Vann Marlo M. Villegas

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