The Bangko Sentral ng Pilipinas is set to unveil a set of penalties on Metropolitan Bank and Trust Co. this week, ending a four-month long probe after a big case of internal fraud committed by a senior official was uncovered at the country’s second-largest financial institution earlier this year.
At the same time, however, Metrobank officials stressed that the publicly listed bank controlled by taipan George S.K. Ty had been taking proactive steps to address weaknesses that were exposed after one of its vice presidents, Maria Victoria Lopez, was caught faking loans to legitimate bank clients but siphoning off the proceeds to private accounts under her control.
“We have learned a lot from this incident, and we’ve been working to tighten internal processes from day one,” Metrobank president Fabian Dee told the Inquirer in an interview on Saturday. “We’ve been working closely with the central bank to make sure that all their concerns are addressed.”
On Saturday, Metrobank chair Arthur Ty told the Inquirer that a rigorous audit process had resulted in the bank determining conclusively that the absolute amount stolen from it by the rogue senior official stood at P1.7 billion—in the median of the bank’s initial estimate of P900 million and the original P2.5-billion figure originally tipped off by whistleblowers to the Inquirer.
Ty said their internal probe determined that Lopez was a lone wolf “at least within the bank” but might have had accomplices externally.
“There’s a good chance we’ll be able to recover some of the money, including from offshore accounts” he said.
The Inquirer learned that among the penalties the central bank would impose on Metrobank were a slew of policy impositions that would require the financial giant to tighten internal controls and audit mechanisms to help prevent a repeat of the incident—something which Ty and Dee said was already being done by the bank.
“We have new processes of checks and balances which we’ve implemented, including conducting regular balance updates with clients on the loan side,” Ty said, explaining that the process was an expansion of Metrobank’s controls that used to be applied only to depositors.
Dee said, meanwhile, that the bank also audited all high networth and corporate borrowers that were formerly handled by Lopez—“over 2,000 of them”—and determined that 99.4 percent of them had no issues.
Sources indicated that other BSP penalties on Metrobank might be administrative sanctions against ranking officials or members of the board for failing to detect the systematic fraud committed by Lopez that insiders said had been going on for several years before she was caught.