ILOILO City – A Friday, May 17, 2019 was supposed to be a normal day, the last day of the work week, after which on the weekend Filipino-Chinese families would dine out, attend family parties and those of close friends, and go to their respective churches.
But before lunch of that Friday, the worst news they have been expecting finally came to face them.
On the first banking hour of May 17, clients wishing to enter Valiant Bank’s main branch on Mabini, Street here had their attention caught by a sign on the door. It was a “Notice to the Public.” It read:
Pursuant to Section 30 of R.A. No. 7653 (New Central Bank Act), the Monetary Board of the Bangko Sentral ng Pilipinas decided in its Resolution No. 725.A dated May 16, 2019, to prohibit Valiant Bank, Inc. (A Rural Bank) with Head Office address at 41 Valiant Bldg., Mabini St., Brgy. Liberation, Iloilo City, to do business in the Philippines, and to direct the Philippine Deposit Insurance Corp. (PDIC) as the designated Receiver to proceed with the takeover and liquidation of the bank in accordance with Section 12(a) of Republic Act (R.A.) No 3591, as amended by R.A. 10846 (amended PDIC Charter).
The PDIC took over the bank and all its branches, assets, records and affairs on May 17, 2019.
There were also numerous uniformed policemen and Bangko Sentral ng Pilipinas (BSP) employees in the building.
Word quickly spread among the bank’s Filipino-Chinese clientele, through landline calls, text messages, Facebook Messenger groups and Viber groups.
By lunchtime, the news was out.
Why such extraordinary fuss over the closure of a rural bank? Such incidence could be seen in the news almost every week.
It turns out that a lot of Filipino-Chinese families were the bank’s depositors.
Depositors claimed to have earned an annual interest rate of 10 percent for over 10 years. Such rate is significantly higher than the standard rates given by the country’s universal and commercial bank.
Some claimed to have been unable to withdraw their funds for over five years and suspected that their funds were no longer good as cash but were merely money on paper.
That same Friday, PDIC released a press release confirming that, indeed, the Monetary Board closed Valiant Bank and that PDIC would pay all valid insured deposit claims.
Valiant Bank is a nine-unit rural bank. Aside from its head office in Brgy. Liberation here, it has eight branches: four in Iloilo (Banate, Dueñas, Estancia and Sara); two in Capiz (Roxas City and Sapian); one in San Jose, Antique; and one in Bacolod City, Negros Occidental.
According to PDIC press release, “latest available records show that as of March 31, 2019, Valiant Bank has 6,567 deposit accounts with total deposit liabilities of P480.7 million, of which 85.81 percent or P412.5 million are insured deposits.”
ADVICE FROM PDIC
PDIC assured depositors that all valid deposits and claims shall be paid up to the maximum deposit insurance coverage of P500,000.
It said individual account holders of valid deposits with balances of P100,000 and below do not need to file deposit insurance claims, provided they have no outstanding obligations or have not acted as co-makers of obligations with Valiant Bank. These individual depositors must ensure that they have complete and updated addresses with the bank.
For business entities and all other depositors who are required to file claims for deposit insurance, PDIC said the schedule for filing of claims will be announced through posters in the bank premises and in other public places, the PDIC website www.pdic.gov.ph, and PDIC’s official Facebook account.
CLIENTS BEWILDERED
After reading the BSP Monetary Board press release, more than a few businessmen who were familiar with the situation were left bewildered.
The bank had a mere P480.7 million in recorded deposit and only P68.2 million were not covered by insurance. They remarked that the claimed deposit amount could have only been the deposits of three or perhaps four Filipino-Chinese families in Iloilo.
Several depositors have claimed that their deposit certificates were converted into post-dated checks, thereby excluding them from the P500,000 PDIC insurance protection.
Some claimed to have received “fake” deposit certificates, after confirming the authenticity of these with the BSP.
Indeed, the closure of the bank leaves more questions than answers. Though it was expected by a lot of depositors, opinions seem to point that a large number of families incurred severe monetary losses.
Sadness, loss of capital, and hindrance to development are results from this troubling financial scandal./PN
