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Cebu Archbishop Ricardo Cardinal Vidal yesterday asked bank owners to assist troubled depositors as he appealed for calm.
“As much as possible depositors should not panic. At least our government has given an assurance to protect the interest of the people,” he said.
He said banking institutions and the government have to convince depositors their hard earned money is safe with them.
“The problem of course is the trust of the people,” he told reporters after a fiesta Mass at the shrine of Our Lady of Guadalupe de Cebu.
“I am not able to control that. They must know from experience that they have some things that they have promised and they did not fulfill,” he added.
Representatives of the state deposit insurer arrived in Cebu yesterday to take over operations of cash-deficient rural banks of the Legacy group.
Personnel from the Philippine Deposit Insurance Corporation (PDIC) will start examining assets of the Philippine Countryside Rural Bank (PCRB) and Pilipino Rural Bank, and then later receive insurance claims of depositors.
Each depositor is can recover up to P250,000, the maximum amount insured by PDIC.
The Bank Sentral ng Pilipinas (BSP) has placed under receivership seven of 10 rural banks of the Legacy group nationwide.
These are :
1. Philippine Countryside Rural Bank (PCRB) with branches in Mandaue City, Lapu-Lapu City and Liloan in Cebu,
2. Bank of East Asia based in Minglanilla, Cebu
3. First Interstate Bank in Tacloban City.
4. Rural Bank of Paranaque
5. Rural Bank of Bais in Negros Oriental
6. Pilipino Rural Bank (with branches in Mandaue and Argao in Cebu and Tagbilaran City in Bohol)
7. Rural Bank of San Jose in Batangas.
"The receivership enables the PDIC to take-over the banks' assets to protect the interest of bank depositors and to start processing deposit nsurance claims", BSP said in a statement.
By Monday, Cebu city officials will open a on-stop information center to serve troubled depositors.
The center will be headed by lawyer Manuel Legaspi, a former city councilor, the Department of Social Welfare and Services (DSWS) headed by Catherine Yso and Councilor Gerardo Carillo.
Acting Mayor Michael Rama, who pushed for th center, said they will contact radio and TV stations to help spread the word.
Legaspi called the BSP in Manila and was told a statement about the bank holidays of the rural banks will be published in national newspapers. Legaspi said he can also ask the help of the Integrated Bar of the Philippines (IBP) for legal services.
The BSP, in a press statement, said the troubled Legacy rural banks represent only a tiny fraction of the banking system.
It said the banking system remains stable, highly-capitalized, and highly liquid and that the BSP is investigating these banks to determine their financial condition and viability as well as violations on banking laws that may have been committed.
Meanwhile, the Rural Bankers Association of the Philippines(RBAP) issued a statement that amidst these problems were isolated and unique to few and that most rural banks “continue to outperform the entire Philippine Baking System.”
Meanwhile, operations are expected t normalize next week in the Rural Bank of Subangdaku (RBS) in Mandaue City, where heavy withdrawals forced the bank to temporarily stop transactions on Thursday,
RBS is not part of the Legacy group but was affected by the “abnormal level of uncertainty” caused by the sudden bank holiday declared by the latter's rural banks.
Marites Obenza, administrator, said the RBS board of directors, headed by president Paz Radaza, would meet this week to discuss the situation.
“Hopefully, by next week the operations will normalize,” she said.
Yesterday, the RBS continued for the second day to refuse withdrawals and deposits. But the office remained open for clients to come in and hear the explanation of bank representatives.
Obenza said RBS is banking on its 28-year relationship with clients and assurances that the financial position of the rural bank is stable.
“We explained to the clients and asked for their patience and consideration. At this point in time we don't deny that we were not affected by the declaration of bank holidays of rural banks nearby,” she added.
Some clients delivered lunch and snacks for the bank staff.
“Since the 1997 crisis, we managed to survive and we are still around. The banking system is safe and sound. Whatever happened to other rural banks is an isolated case,” she said.
She said that the bank last month applied for a change in the schedule of banking days and hours. The new schedule took effect yesterday. report from Ma. bernadette a. parco, Jhunnex Napallacan, jully venus cuizon
