PDIC set to auction off assets of ailing banks

The Philippine Deposit Insurance Corp. will auction off about P267 million worth of assets it has acquired from banks placed under its receivership.

The PDIC said pieces of real estate to be auctioned off on Oct. 25 include 59 residential properties, eight mixed-use properties, and two industrial/agricultural properties.

In a statement, the deposit insurer said it would invite potential property buyers to the auction that would be held at its Makati City office.

The assets on the auctioned block include properties acquired by banks from borrowers who defaulted on their loans. The deposit insurer wants to sell these to ensure that its pool of funds remain healthy.

The deposit insurance fund now stands at about P67 billion, PDIC said. The insurer taps the fund whenever it needs to settle claims of depositors with cash in closed banks.

Earlier, PDIC said it sold six residential and three commercial properties of closed banks, generating P28.5 million in the process.

The need for PDIC to generate funds from the sale of assets has increased due to the closure this year of thrift banks Banco Filipino and LBC Development Bank.

As the deposit insurer, PDIC is tasked with paying the deposits of clients of banks ordered closed by the central bank. Under the law, a deposit account worth P500,000 or below is covered by PDIC.

According to estimates, deposits placed in Banco Filipino amounted to P15 billion. Also, deposits in LBC Development Bank stood at about P6 billion.

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