Banks in a Holiday

Por: dexter | |

Below is the list of the banks that declared bank holiday, temporary closed or are closed by the Monetary Board starting this month, December 2008. I am continuously updating this list:

1. Legacy Group - Rural Bank of Bais, Negros Oriental (Closed)
2. Legacy Group - Pilipino Rural Bank, Cebu (Closed)
3. Legacy Group - Rural Bank of San Jose, Batangas (Closed)
4. Legacy Group - Rural Bank of Parañaque, Metro Manila (Closed)
5. Legacy Group - Philippine Countryside Bank, Cebu (Closed)
6. Legacy Group - First Interstate Bank, Leyte (Closed)
7. Legacy Group - Bank of East Asia formerly Rural Bank of Minglanilla, Cebu (Closed)
8. Legacy Group - Dynamic Bank formerly Rural Bank of Calatagan, Batangas (In Holiday Closed)
9. Legacy Group - San Pablo City Development Bank (In Holiday Closed)
10. Nation Bank in Bacolod City. (In Holiday)
11. Gaisano - Rural Bank of Subangdaku, Cebu (Temporary Closed But didn’t declare Bank Holiday)

All these banks, except Nation Bank, are under the Legacy Group of which the major shareholder of it is Sto Domingo, Albay Mayor Celso delos Angeles Jr.

The closure of these banks affected not only the employees of those banks but most especially the bank’s depositors. Based on my knowledge, the depositors of the banks under the Legacy Group prior to its closure continuously increase as lots of people became interested with their product “Double Your Money in 5 Years”.

Those depositors who invested their money to the banks of the Legacy Group early (5 or more years ago) might have recovered their capital already. Some of them had doubled their money already. But those who are late, or those who just invested this year or last year, are not so lucky enough. We’ll just hope that they could still recover their money through the PDIC.

Why are these banks declaring bank holiday?

Bank Holiday is defined as a temporary closure of the bank when the bank doesn’t have enough resources or money for the normal business transaction.

The Central Bank’s policy says that a bank is allowed to declare bank holiday if they can no longer serve the withdrawals made by their depositors.

But the bank can actually ask the Banko Sentral ng Pilipinas for an emergency loan based on the bank’s property that will be used as collateral on this loan. The money will be used to finance further the bank’s business.

However, if the bank couldn’t acquire a loan from the BSP, then the bank can declare bank holiday, and the Central bank will now take over the bank.

Then what will happen next?

There are actually two options on what will happen next to that particular bank. The might be permanently closed or might be reopened again.

What if the bank will be permanently closed, what will happen to our money deposited into that bank?

If the bank will be shut down permanently, then we have again two options on what will happen to our money deposited on that particular bank.

1. If your money deposited into that affected bank is equal or less than 250,000PHP, then you can claim your money from the PDIC because up to 250,000PHP is insured through the PDIC.
2. But if your money is more than 250,000PhP, then you don’t have problem with the insured amount which is 250,000PhP because you can still claim it from the PDIC. The problem is the remaining amount. PDIC will only pay you up to 250,000PhP and the rest will be “thank you”.