Guarding our bank savings

We already knew as early as July that the Marcos administration was siphoning a significant amount of the funds of the Philippine Deposit Insurance Corp. (PDIC), along with so-called idle funds from the Philippine Health Insurance Corp.

- IRIS GONZALES

PDIC is our state deposit insurer. It was established to promote and safeguard the interests of the depositing public by providing insurance coverage on all insured deposits. PDIC provides a maximum deposit insurance coverage of P500,000 per depositor per bank.

This insurance is set aside in case – knock on wood – a bank suddenly collapses.

PDIC builds up its Deposit Insurance Fund primarily through assessments of banks at an annual flat rate of one-fifth of one percent of their total deposit liabilities.

The good news is that our banking system – thanks to the hard work of our regulators over the past years – has significantly strengthened and remains sound.

Gone are the days when fears of bank runs kept Filipino depositors and banking regulators sleepless at night.

Perhaps this is the reason why the Marcos administration had no qualms about touching the funds meant for the insurance of our hard-earned money kept in banks.

Finance Secretary Ralph Recto has said that such moves are legal, as affirmed by a legal opinion from the Office of the Government Corporate Counsel.

In any case, it’s as good a time as any to look at the numbers, which I’ve had the chance to study in recent days.

Here’s what I gathered: