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    NU 3.1 PDIC Exercise

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    This document summarizes Philippine deposit insurance rules. Key points include: 1. Deposits are insured on a per bank basis up to 500,000 PHP. Splitting deposits to get more coverage is not allowed. 2. For determining insured amounts, all deposits held by the same person in the same capacity are aggregated, regardless of account type. This includes accounts held "for" or "in trust for" others. 3. Joint accounts are insured separately up to 500,000 PHP each if ownership is stipulated, otherwise the amount is divided equally. A depositor's total insured amount across individual and joint accounts is 1,000,000 PHP. 4. Several examples are provided to

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    NU 3.1 PDIC Exercise

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    134 views12 pages
    This document summarizes Philippine deposit insurance rules. Key points include: 1. Deposits are insured on a per bank basis up to 500,000 PHP. Splitting deposits to get more coverage is not allowed. 2. For determining insured amounts, all deposits held by the same person in the same capacity are aggregated, regardless of account type. This includes accounts held "for" or "in trust for" others. 3. Joint accounts are insured separately up to 500,000 PHP each if ownership is stipulated, otherwise the amount is divided equally. A depositor's total insured amount across individual and joint accounts is 1,000,000 PHP. 4. Several examples are provided to

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    This document summarizes Philippine deposit insurance rules. Key points include: 1. Deposits are insured on a per bank basis up to 500,000 PHP. Splitting deposits to get more coverage is not allowed. 2. For determining insured amounts, all deposits held by the same person in the same capacity are aggregated, regardless of account type. This includes accounts held "for" or "in trust for" others. 3. Joint accounts are insured separately up to 500,000 PHP each if ownership is stipulated, otherwise the amount is divided equally. A depositor's total insured amount across individual and joint accounts is 1,000,000 PHP. 4. Several examples are provided to

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    134 views12 pages

    NU 3.1 PDIC Exercise

    Uploaded by

    Back up
    This document summarizes Philippine deposit insurance rules. Key points include: 1. Deposits are insured on a per bank basis up to 500,000 PHP. Splitting deposits to get more coverage is not allowed. 2. For determining insured amounts, all deposits held by the same person in the same capacity are aggregated, regardless of account type. This includes accounts held "for" or "in trust for" others. 3. Joint accounts are insured separately up to 500,000 PHP each if ownership is stipulated, otherwise the amount is divided equally. A depositor's total insured amount across individual and joint accounts is 1,000,000 PHP. 4. Several examples are provided to

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    of 12

    Phil Deposit Insurance Corp

    RA-3591, amended by RA’s 7400, 9302, 9576


    (Course Material 3-Exercise)

    Atty. JV Abuel
    LPT MBA CPA Juris Doctor
    DEPOSITS ACCOUNT NOT ENTITLED TO PAYMENT
    1. Deposit products that resulted from splitting deposits
    2. Deposits products or money placements by the head office of a foreign bank in
    its branch in the Philippines because there is only one entity.
    3. Deposits that are determined to be the proceeds of an unlawful activity as
    defined under RA 9160 of the AMLA, as amended.
    4. Deposits payable in a place outside the Philippines (like those in foreign
    branches)
    5. Deposit accounts or transactions which are unfunded and that are fictitious or
    fraudulent.
    6. Deposit accounts or transactions constituting and/or emanating from unsafe
    and unsound banking practice/s, as determined by PDIC, in consultation with
    BSP, after due notice and hearing, and publication of a cease and desist order
    issued by ODIC against such deposit accounts or transactions.
    7. Investment products such as bonds and securities, trust accounts and other
    similar instruments.
    Deposit products that resulted from splitting deposits
    Splitting of deposits occurs whenever:

    a. A deposit account with an outstanding balance more than P500,000 is


    broken down and transferred to two or more accounts to the name of
    persons or entities who have no beneficial ownership in the transferred
    deposits in their names.
    b. Within 120 days immediately preceding or during a bank declared bank
    holiday or immediately preceding a closure order issued by the Monetary
    Board.
    c. For the purpose of availing the maximum deposit insurance coverage.
    ILLUSTRATION: Mr. X maintains P250,000 in XYZ Bank’s Manila
    branch and P300,000 in XYZ Bank’s US Branch. In the event of a
    closure of XYZ Bank, how much is Mr. X’s insured deposit?

    ANSWER: P250,000. Since the P300,000 deposited in XYZ Bank’s US


    Branch is not covered being payable outside of the Philippines.
    DETERMINATION OF THE AMOUNT DUE
    Per Bank: the entitlement to deposit insurance is on a per bank basis. Such that if
    X has a deposit with A Bank and B Bank and both banks closed, X is entitled to
    P500,000 insurance coverage for each bank.

    Per Depositor, Per Capacity Rule: all deposits in the bank maintained in the same
    right and capacity for his benefit either in his own name or in the name of others
    shall be added together in determining the insured amount, and regardless of
    the type of account.

    Accounts “By”, “In Trust For (ITF)” or “For the Account of (FAO)” another person:
    1. In a “By” account (Juan by Pedro) – Juan is the Depositor
    2. In an “ITF” account (Juan ITF Pedro) – Pedro is the Depositor
    3. In a “FAO” account (Juan FAO Pedro) – Pedro is the Depositor
    Individual Accounts: All individual accounts of a depositor, including the above where
    ownership is vested in him, shall be insured to a maximum of P500,000
    ILLUSTRATION: How much is Fe Santos’s insured deposit if she has the following four deposit
    accounts in the same bank?
    Insured Deposit of Fe
    Account Name Deposit in PHP
    Santos
    Fe Santos P100,000 P100,000
    Ben Santos For the
    P100,000 P100,000
    Account of Fe Santos
    Charlie Santos In Trust For
    Fe Santos P100,000 P100,000

    Fe Santos’ Store (Sole


    P700,000 P200,000
    Proprietorship)
    TOTAL P1,000,000 P500,000
    JOINT ACCOUNTS: A joint account regardless of whether the conjunction “and”, “or”,
    “and/or” is used shall be insured separately for any individually owned deposit
    account provided that:
    1. If the account is held jointly by two or more natural persons, or by two or more
    juridical persons or entities, the maximum insured deposit shall be divided into as
    many equal shares as there are individuals, juridical persons or entities, unless a
    different sharing is stipulated in the document of deposit, and
    2. If the account is held by a juridical person or entity jointly with one or more
    natural persons, the maximum insured deposit shall be presumed to belong
    entirely to such juridical person or entity.

    Provided, further that the aggregate of the interest of each co-owner over several
    joint accounts, whether owned by the same or different combinations of individuals,
    juridical persons or entities, shall likewise be subject to the maximum insured
    deposit of P500,000.
    The P500,000 entitlement to joint deposits is separate from the P500,000 applicable to
    the individually owned accounts by the depositor, giving him a maximum of P1,000,000
    insurance coverage.
    In short, a depositor who maintains both individual and joint accounts may be insured
    up to a total of P1,000,000: P500,000 for all his individual accounts, P500,000 for all his
    joint accounts.
    ILLUSTRATION: Juan Dela Cruz maintains the following accounts with XYZ Bank.

    Account Name Type of Deposit Balance


    Juan Dela Cruz Savings P600,000
    Juan Dela Cruz AND Maria Dela Cruz Demand P500,000
    Juan Dela Cruz OR Pedro Dela Cruz Time P800,000
    How much is the total insured and uninsured deposit of
    Juan Dela Cruz?
    Account Name Type of Deposit Balance Insured Uninsured
    Juan Dela Cruz Savings P600,000 P500,000 P100,000
    Juan Dela Cruz AND Maria Dela Cruz Demand P500,000 P250,000 P -0-
    Juan Dela Cruz OR Pedro Dela Cruz Time P800,000 P250,000 P150,000
    P1,000,000 P250,000

    If Juan had another joint account with Jose, the balance of which is P500,000, how
    much is the total insured and uninsured deposit of Juan Dela Cruz?

    ANSWER: Juan Dela Cruz share of the balance will be P250,000, but there is no more
    insurance coverage for Juan since he already exhausted the P500,000 insurance
    coverage with the first two joint accounts under 1 above.
    END OF ILLUSTRATIONS
    THANKS

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