The central bank, Bangko Sentral ng Pilipinas (BSP), has shut down four rural banks and identified four others that have declared a bank holiday or voluntary suspension of operations.

Padlocked and placed under receivership by the Philippine Deposit Insurance Corp. were: Rural Bank of Parañaque; Rural Bank of Bais (Negros Oriental); Pilipino Rural Bank (Cebu) and Rural Bank of San Jose (Batangas).

The four banks that have declared a bank holiday were Philippine Countryside Bank (Cebu); Dynamic Bank (Rural Bank of Calatagan); San Pablo City Development Bank and Nation Bank (Bacolod City).

?The BSP is investigating these banks to determine their financial condition and viability as well as violations of banking laws that may have been committed,? the BSP said in a statement Thursday night.

The BSP said it would take appropriate action based on its findings, and appealed to the public not to speculate on the financial health of banks.

It added that these banks represented only a tiny fraction of the banking system.

The banking system remains stable, highly capitalized and highly liquid, the BSP said.

Some of the banks identified by the BSP are part of the Legacy group of banks, which earlier engaged the BSP in a legal battle that prevented the BSP from acting on examination reports that found capital deficiency in some of its banks, citing the need for due process.

The Supreme Court recently nullified trial court decisions that favored the Legacy group. With editing by INQUIRER.net

[Read related story: RBS bank suspends business]