Article 176Supplement v1, p. 176

COMMERCIAL LAWS SUPPLEMENT

(e) To authorize, with his signature, upon prior authority of

the Board, contracts entered into by the Corporation,

notes and securities issued by the Corporation, and the

annual

reports,

balance

sheets,

profits

and

loss

statements, correspondence and other documents of the

Corporation. The signature of the President may be in

facsimile wherever appropriate;

(f) To represent the Corporation, either personally or

through counsel, including private counsel, as may be

authorized by the PDIC Board, in any legal proceeding or

action;

(g) To delegate, with the prior approval of the Board of

Directors, his power to represent the Corporation, as

provided in subsections (d) and (f) of this Section, to other

officers of the Corporation; and

(h) To exercise such other powers as may be vested in him

by the Board.

The President shall be assisted by a Vice President and

other officials whose appointment and removal for cause

shall be approved and whose salary shall be fixed by the

Board

of

Directors

upon

recommendation

of

the

President of the Corporation. During the absence or

temporary incapacity of the President, or in case of

vacancy

or

permanent

incapacity

and

pending

appointment of a new President of the Corporation by

the President of the Philippines, the Board of Directors

shall designate the officer-in-charge of the Corporation.

DEFINITION OF TERMS

SECTION 5. As used in this Act –

(a) The term asset refers to movable, immovable, tangible,

or intangible resources or properties over which a bank

has an established or equitable interest, including the

proceeds of the sale of its bank and branch licenses

subject to the approval of the Bangko Sentral ng Pilipinas.

(b) The term asset distribution plan refers to the plan of

distribution of the assets of a closed bank to its creditors,

based on its estimated realizable value as of a certain

cut-off date, prepared in accordance with the Rules on

Concurrence and Preference of Credits under the Civil

Code or other laws.

An asset distribution plan may be partial when it pertains

to the distribution of a portion or some of the assets of

the

closed

bank,

or

final

when

it

pertains

to

the

distribution of all the assets of the closed bank.

(c) The term Board of Directors means the Board of

Directors of the Corporation.

(d) The term bank and banking institution shall be

synonymous

and

interchangeable

and

shall

include

banks,

commercial

banks,

savings

banks,

mortgage

banks,

rural

banks,

development

banks,

cooperative

banks, stock savings and loan associations and branches

and agencies in the Philippines of foreign banks and all

other

corporations

authorized

to

perform

banking

functions in the Philippines.

(e) The term closed bank refers to a bank placed under

liquidation by the Monetary Board.

(f) The term creditor refers to any individual or entity with

a valid claim against the assets of the closed bank.

(g) The term deposit means the unpaid balance of money

or its equivalent received by a bank in the usual course of

business and for which it has given or is obliged to give

credit to a commercial, checking, savings, time or thrift

account, evidenced by a passbook, certificate of deposit,

or other evidence of deposit issued in accordance with

Bangko Sentral ng Pilipinas rules and regulations and

other

applicable

laws,

together

with

such

other

obligations of a bank, which, consistent with banking

usage

and

practices,

the

Board

of

Directors

shall

determine and prescribe by regulations to be deposit

liabilities of the bank: Provided, That any obligation of a

bank which is payable at the office of the bank located

outside of the Philippines shall not be a deposit for any of

the purposes of this Act or included as part of the total

deposits or of insured deposit: Provided, further, That

subject to the approval of the Board of Directors, any

insured bank which is incorporated under the laws of the

Philippines

which

maintains

a

branch

outside

the

Philippines may elect to include for insurance its deposit

obligations payable only at such branch.

The Corporation shall not pay deposit insurance for the

following accounts or transactions:

(1) Investment products such as bonds and securities,

trust accounts, and other similar instruments;

(2) Deposit accounts or transactions which are fictitious

or fraudulent as determined by the Corporation;

(3) Deposit accounts or transactions constituting, and/or

emanating from, unsafe and unsound banking practice/s,

as determined by the Corporation, in consultation with

the Bangko Sentral ng Pilipinas, after due notice and

hearing, and publication of a directive to cease and desist

issued by the Corporation against such deposit accounts,

transactions or practices; and

(4) Deposits that are determined to be the proceeds of an

unlawful activity as defined under Republic Act No. 9160,

as amended.

The actions of the Corporation taken under Section 5(g)

shall be final and executory, and may only be restrained

or set aside by the Court of Appeals, upon appropriate

petition for certiorari on the ground that the action was

taken in excess of jurisdiction or with such grave abuse of

discretion as to amount to a lack or excess of jurisdiction.

The petition for certiorari may only be filed within thirty

(30) days from notice of denial of claim for deposit

insurance.

(h) The term disputed claim refers to a claim or suit

against the assets of a closed bank, or for specific

performance,

or breach of contract, or damages, of

whatever nature or character, whether for money or

otherwise, liquidated or unliquidated, fixed or contingent,

matured or current, denied by the receiver.

(i) The term insured bank means any bank the deposits of

which are insured in accordance with the provisions of

this Act.

(j) The term insured deposit means the amount due to

any bonafide depositor for legitimate deposits in an

insured bank as of the date of closure but not to exceed

Five

hundred

thousand

pesos

(P500,000.00).

Such

amount

shall

be

determined

according

to

such

regulations as the Board of Directors may prescribe. In

determining such amount due to any depositor, there

shall

be

added

together

all

deposits

in

the

bank

maintained in the same right and capacity for his or her

benefit either in his or her own name or in the name of

others.

A

joint

account

regardless

of

whether

the

conjunction ‘and’, ‘or’, ‘and/or’ is used, shall be insured

separately from any individually-owned deposit account:

Provided, That (1) if the account is held jointly by two or

more natural persons, or by two or more juridical persons

or entities, the maximum insured deposit shall be divided

into as many equal shares as there are individuals,

juridical persons or entities, unless a different sharing is

stipulated in the document of deposit, and (2) if the

account is held by a juridical person or entity jointly with

one or more natural persons, the maximum insured

deposit shall be presumed to belong entirely to such

juridical person or entity: Provided, further, That the

aggregate of the interest of each co-owner over several

joint accounts, whether owned by the same or different

combinations of individuals, juridical persons or entities,

shall likewise be subject to the maximum insured deposit

of Five hundred thousand pesos (P500,000.00): Provided,

furthermore,

That

the

provisions

of any law to the

contrary

notwithstanding,

no

owner/holder

of

any

passbook, certificate of deposit, or other evidence of

deposit shall be recognized as a depositor entitled to the

rights provided in this Act unless the passbook, certificate

of deposit, or other evidence of deposit is determined by

the Corporation to be an authentic document or record of

© Compiled by RGL

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