Cebu rural bank ordered shut, 5th in 2022 | Inquirer Business

Cebu rural bank ordered shut, 5th in 2022

The Monetary Board has ordered Metro-Cebu Public Savings Bank to stop doing business and be placed under liquidation, the fifth bank to be shuttered so far this year.

Earlier this year, the MB sent out similar orders to four others—all rural banks—which operated in Leyte, Ilocos Sur, Laguna and Pangasinan.


This happened as the Bangko Sentral ng Pilipinas (BSP) prepared to roll out the Rural Bank Strengthening Program (RBSP) to enhance the operations, capacity and competitiveness of rural banks.

At the same, the state-run Philippine Deposit Insurance Corp. (PDIC) has warned the public about a deposit insurance payout scam.


Separately, in an advisory, the PDIC said payouts for bank deposit insurance claims were processed without any fees and only for qualified clients of closed banks.

PDIC raised the alarm about a scheme through which fraudsters inform potential victims that they have a pending claim, which they would receive if they made a deposit to a certain bank account.

This deposit insurance scam is being perpetrated using counterfeit documents, which bear the PDIC logo and forged signatures of senior government officials.

In particular, intended victims are sent a fake Letter of Assurance document, claiming that PDIC is obligated to disburse funds to the recipient.

However, such funds will only be released after the victim paid an “obligatory insurance” through a certain deposit account in a Philippine bank.

“The public is strongly advised to ignore calls, messages, or emails from individuals with ‘too good to be true’ promises or suspicious transactions; and to decline requests for any personal information by those claiming to be employees of the PDIC or other government institutions without first verifying their identities with the organizations they claim to represent,” it added.

Also, PDIC said it “will not be liable for any financial implications resulting from the scam and other transactions with unauthorized individuals.”


In 2021, the highest policy making body of the BSP ordered shut 13 rural banks.

By mandate, PDIC assumes receivership of banks that were ordered closed, including Metro-Cebu Public Savings Bank, which had two branches — one in Lapu-lapu City and another in Talisay City.

Also by law, any bank placed under liquidation may not be rehabilitated nor be re-opened and permitted to resume banking business.

“The PDIC took over the Bank and all its branches, assets, records and affairs on April 1, 2022,” the state firm said in a bulletin.

In 2020, during the initial impact of the COVID-19 pandemic, the MB issued orders of liquidation on just five rural banks. Before that, there were 11 banks in 2019, 12 in 2018, six in 2017, and 22 in 2016.

Last week, the MB gave the green light for the BSP to roll out the RBSP, which will run for three years and intended to promote a safe, sound, and resilient financial system.

“We believe that the RBSP is necessary to boost the resilience of rural banks amid the evolving challenges in the banking system and to enhance their role in promoting inclusive growth,” BSP Governor Benjamin Diokno said in a media briefing.

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