Anxious depositors flock to closed LBC bank

MANILA, Philippines— Anxious depositors of LBC Development Bank, which was closed Friday, flocked to its head office on J.P .Rizal street in Makati City on Monday, trying to find out how they could withdraw their deposited money, Erwin Aguilon of 990AM reported Monday.

LBC Development Bank, a unit of the LBC Group, has been placed under receivership of the Philippine Deposit Insurance Corp. (PDIC).

In a statement over the weekend, PDIC said it took over the assets and liabilities of LBC bank after the Monetary Board of the central bank determined that the institution was plagued by liquidity problems.

“All valid accounts and deposit insurance claims will be paid as soon as possible,” PDIC said in a statement.

Benhur Casulpit, a depositor for two years, said that he went there after learning in the news early Monday morning that the bank was closed. “As a depositor, I went here to check my account.”

Casulpit said that a PDIC employee had told him that he could get his money in six months but he said he needed the money now. “I need to get my money for my wife’s hospitalization; where will I get (money) now?”

He said he had not received any information from the bank.

Dona Garcia, who used to receive money from abroad every week, was also shocked knowing that the reason why she did not get this week’s money was because the bank was closed, the report said. “I hope they can do something about it because people need the money.”

An LBC bank accountant, who refused to be identified, said his company was having problems since they had around P10 million deposits and PDIC would only shoulder up to P500,000, the report said.

Under PDIC’s charter, deposits worth P500,000 or below are covered by insurance. Deposits in excess of the amount may or may not be paid depending on the amount to be raised from the liquidation of a closed bank’s assets.

The report noted that there was a “notice to the public” dated September 9 posted at the LBC entrance that said that the central bank had decided to prohibit LBC Development Bank to do business in the Philippines and that PDIC was to take over the banks’ assets.

PDIC will conduct forums in areas where branches of LBC are located so that depositors of the bank will know how to claim insurance, the radio report said.