Outline of Presentation PDIC at a Glance

I PDIC at a Glance • A government instrumentality attached to the

Department of Finance
II Overview of PDIC as Deposit Insurer
• Created on 22 June 1963 by virtue of Republic
III Compliance to Core Principle No. 17
Act 3591
Reimbursing Depositor • One of the oldest deposit insurers in the world
IV Communication Strategy for Reimbursing Depositor

V Handling Queries, Requests, Complaints

VI Communicating with the General Public

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PDIC at a Glance PDIC at a Glance

Public Policy Objectives PDIC Mandates
(Section 1, Republic Act 3591, as amended) (Section 1, Republic Act 3591, as amended)

1. Depositor Protection The Corporation provides deposit

To promote and safeguard the interests of the insurance of up to P500,000, the
depositing public by way of providing permanent and maximum insurance coverage.
continuing insurance coverage on all insured deposits. Member-banks are assessed
As DEPOSIT
annually at a flat rate of 1/5 of 1%
2. Financial Stability INSURER of their total deposit liabilities. The
To strengthen the mandatory deposit insurance assessments are collected from
coverage system to generate, preserve, and maintain member-banks semi-annually and
faith and confidence in the country’s banking system, form part of PDIC’s Deposit
and protect it from illegal schemes and machinations. Insurance Fund.

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PDIC at a Glance Overview of PDIC As Deposit Insurer

PDIC Mandates (Sections 14 and 16, Republic Act 3591, as amended)
(Section 1, Republic Act 3591, as amended) To settle insurance claims of depositors in accordance with provision of
the PDIC Charter
Examination of banks, grants of “xxx as soon as possible xxx” or
As financial assistance and conducts of within 6 months (180 days) from date
Settlement
bank investigation to contribute in the of Claims of filing except if the validity of the
Co-REGULATOR
promotion of public confidence and claim requires resolution of issues by
financial stability in the economy another office/agency

Implementation of closure orders of Filing of

As RECEIVER/
the Monetary Board and preservation Claims 2 years after bank takeover
LIQUIDATOR of
and administration and disposal of
Closed Banks assets of closed banks for the benefit
of its depositors and creditors
2 years after the 2-year period
Enforcement of filing of claims
of Claims
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Overview of PDIC As Deposit Insurer Overview of PDIC As Deposit Insurer
(Sections 14 and 16, Republic Act 3591, as amended)
To settle insurance claims of depositors in accordance with provision of
the PDIC Charter
Corporate Target to Reimburse Depositors
Letter notices to all depositors and
Publication of bank closure &
Notification
prescriptive date of filing 3 consecutive
1 Start of Payout Baseline target of 30 days
Requirement
weeks in a newspaper of general
circulation &/or community newspaper 2 Completion of Target range based on
Failure to settle the claim within 6 payment • Size of closed bank
months from the date of filing due to • Number and complexity
Accountability
abuse of discretion, gross negligence,
of PDIC
bad faith, or malice may subject the of deposit accounts
directors, officers or employees to
imprisonment from 6 months to 1 year

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Overview of PDIC As Deposit Insurer The Philippine Banking System

Corporate Target for 2013

For accounts with balances of - Waived Filing of Claims

≤ P15,000 (benefits at least 76%
of total depositors)
• Banks with ≤ 20 branches 18 days
• Banks with > 20 branches 28 days

For accounts with balances of - Filing of Claims

> P15,000

• Banks with ≤ 20 branches 30 days

• Banks with > 20 branches 60 days

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Overview of PDIC As Deposit Insurer Corporate Milestones on

Bank Closures Claims Management
1970 to 2013 (October)
2009 : Maximum Insurance Coverage increased from P250,000
INSURED DEPOSIT PAID (Amount in Millions)
to P500,000
Year Banks
Accounts Amount (P) Amount (US$) 2010 : ISO Certification 9001:2008 awarded for the Quality
1970 – 1980 45 126,205 70 2 Management System on Claims Settlement Operations
1981 – 1990 217 1,004,483 3,089 71 : Automatic payment of small depositors (with balances
of P5,000 and below)
1991 – 2000 156 286,257 8,978 208
: Adoption of alternative payment schemes for deposit
2001 – 2010 163 494,431 30,053 696
insurance claims (Postal Money Order, Cash Card and
2011 – 2012 53 336,622 16,629 385 Cash Over the Counter)
2013
(Jan. to Oct.)
15 51,057 1,890 44 2011 : Passed the ISO 9001:2008 1st surveillance audit
: Increased the coverage of deposits for automatic
Total 649 2,299,055 60,709 1,406
payment from P5,000 to P10,000
1963: MDIC @ 10k 1992: MDIC @ 100k

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1978: MDIC @ 15k 2004: MDIC @ 250k

1984: MDIC @ 40k 2009: MDIC @ 500k

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 Corporate Milestones on Results of Project Management Approach
Claims Management
2012 : Passed the ISO 9001:2008 2nd surveillance audit
: Increased the coverage of deposits for automatic from
P10,000 to P15,000
: Adoption of a New Claims System
: Pilot Test Project Management as an approach to
Claims Settlement Operations
: Measure degree of compliance with 18 Core Principles

2013 : Renewed and passed ISO Certification 9001:2008

: Conduct of Self-assessment of Compliance to 18 CPs
And External Validation
: Stronger Public Assistance
: Adoption of the Project Management Approach
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Continual Improvement of PDIC Quality

Management System for Claims Operations Compliance to Core Principle No. 17
Reimbursing Depositors
Core Principle
PDIC Roadmap to 2016 & Criteria PDIC Programs

1. Prompt Access to Mandate - 6 months

Deposit Insurance Corporate Target - Less than 30 days

Depositors, Banks, 2. Clear Time Frame Communication Public announcements

Other Stakeholder
for Reimbursing Strategies -newspaper, TV, radio
Depositor Publication of Notice to
Depositors,
Banks, Other Depositors
Stakeholder On-site closed bank’s
information and assistance
Conduct of Depositors’ Forum
Posters and advisories at
bank premises and public
places
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Public Awareness/Communications Strategy 15

Compliance to Core Principle No. 17 Compliance to Core Principle No. 17

Reimbursing Depositors Reimbursing Depositors
Core Principle
Core Principle
& Criteria PDIC Programs
& Criteria PDIC Programs
4. Modes of Payment - Direct Settlement
3. Funding Fund Sources - Permanent Claims Scheme Release by PDIC Claims Payment
Insurance Fund Payment Agent over the counter in cash or
- Access to other cheque
sources of funds - Transfer Deposits
Borrowing Depositor/claimant goes to
Issuance of bonds, transferee bank to collect payment
debenture & other
- Postal Money Order (PMO)
obligations
Philippine Postal Corporation’s
PMO used to service depositors
with account balances of P15,000
and below

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 Compliance to Core Principle No. 17 Compliance to Core Principle No. 17
Reimbursing Depositors Reimbursing Depositors
Core Principle Core Principle
& Criteria PDIC Programs & Criteria PDIC Programs

4. Modes of Alternative - Cash Card for accounts with 5. Information IT - Web-enabled application
Claims Payment balances of P5,000 to P100,000 Technology Infrastructure - Centralized database installed in
Payment Scheme The depositors using the cash the Home Office
card used as a mode of payment - Accessible to system users in
of deposit insurance may be able Home Office and field offices
to withdraw from more than 800 around the Philippines
LBP ATMs nationwide and in ATMs - Integrated modules for Masterlist
of member banks of major bank of Deposit Liabilities,
networks Examination/Register generation
- Cash Over The Counter for and Claims Settlement Operations
insurance claims payments up
to MDIC of P500,000

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Compliance to Core Principle No. 17

Reimbursing Depositors Compliance to Core Principle No. 17
Core Principle Reimbursing Depositors
& Criteria PDIC Programs
Core Principle
6. Contingency Plan Critical - Participated in Financial & Criteria PDIC Programs
Resources Crisis Simulation Exercise
7. Mechanism Access - Bank Secrecy Law but with
with other safety net player
for to deposit Special Exam Power (Section 8 of
in 2011
Anticipatory data prior Charter)
- Alternative Methods of
Information to bank - Threatened or impending closure
Claims Payout
closure of a bank
- Different modes of claims
- Unsafe & unsound banking
payment
practice
- Advance/Interim Insurance
- Infrastructure for bank
Payout
performance monitoring Offsite
- Emergency Payment Facility
Bank Ratio Model
- Support departments/
- Regulatory Issuance on Banks’
21 mechanism in placed
Records Keeping
- Manpower Outsourcing
- Financial Modeling Project (Stress
- Outsourcing of Selected
Testing & Bank Failure Prediction
Functions to Auditing Firm
Model) 22
- Equipment rental/lease

Press Statements
Issuance of 3
Information
Press Statements
Bank Closure o Name of Bank
Monetary Board Resolution number and date

8.Communication Strategy for

o
o Bank Owners
o Head Office location and Number of banking units

Reimbursing Depositors
o Number of Bank Accounts
o Coverage and Total insured deposits
o Assurance from PDIC that all valid claims shall be paid up to a
maximum of PHP500,000 (USD12,255)
o Schedule and venue of Depositors-Borrowers Forums
o Deadline for small depositors to update mailing address
o Date the PDIC will start mailing of payments to small
depositors
o Target date to start Claims Settlement Operations
o PDIC contact details
Mailing of payment for small o Number of accounts covered
depositors (balances of o Payment scheme information
PHP15,000 and below) o PDIC contact details
Payout o Schedule of claims settlement operations
o Deposit insurance claims procedure
o Requirements
o Information on filing claims
o PDIC contact details
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Press Statements First Phase: Takeover

• Information dissemination

• Frontline depositor assistance

• Courtesy call with local government

units

• Depositors / borrowers forum

• Distribution of control numbers

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First Phase: Takeover First Phase: Takeover

FRONTLINE DEPOSITOR ASSISTANCE FRONTLINE DEPOSITOR ASSISTANCE

• Assist depositors in
• Entertain queries
filling up forms
• Pacify irate depositors/clients

• Client Monitoring of
• Inform depositors of basic depositor/borrower
requirements in filing concerns
claim, schedule of • Receive duly accomplished
depositors’ forum and Mailing Address Update Form
claim settlement for depositors not required to
• Distribute forms 27 file deposit insurance claims 28

First Phase: Takeover First Phase: Takeover

COURTESY CALL WITH LOCAL GOVERNMENT UNITS INFORMATION DISSEMINATION

• Courtesy call / attend LGU meetings

• Post notices

• Call / text • Press releases to

depositors local media,
place paid
advertisements if
necessary

• Coordinate with local leaders

PAD personnel visit barangays when
and civic organizations 29 30
necessary

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 First Phase: Takeover First Phase: Takeover
DEPOSITORS / BORROWERS FORUM DEPOSITORS / BORROWERS FORUM

CORE MESSAGE Q&A

• That PDIC will pay valid
deposit insurance claims

• That PDIC is doing its best

to process claims
expeditiously
TOPICS DISCUSSED
• Role of PDIC as Receiver / Insurer / Liquidator
• That PDIC ensures that the
• Application of the maximum deposit insurance coverage right amount of deposit is
• Settlement of Loan obligations paid to the right depositor
• Audio-visual presentation
• Steps/procedures in filing a claim
• Who are required to file, when, where
• Mode of PDIC payment 31 32
• How to fill-up Claim Form

First Phase: Takeover Second Phase: Claims Settlement

DISTRIBUTION OF CONTROL NUMBERS DEPOSITOR ASSISTANCE

• Control numbers are preferably distributed in

venues other than bank premises • Distribute queuing
numbers

• Assist the elderly and persons with disabilities

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Second Phase: Claims Settlement Home Office

DEPOSITOR ASSISTANCE Complementary Activities
• Inform claimants of the procedures PUBLIC ASSISTANCE DEPARTMENT
adopted during payout

• When necessary, assist

claimants in filling up forms
and check completeness of Responds to Queries, Requests, Complaints
basic requirements 35 36
Client Feedback Survey

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 Home Office Home Office
Complementary Activities Complementary Activities
• Call Center with Toll Free Number • PAD Helpdesk

• Emails / letters

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Home Office Queries, Requests, Complaints

Complementary Activities January to October 2013

4,500 70
4,000
60
3,500
50
Queries/Request

3,000
• Client Feedback

Complaints
2,500 40
Survey 2,000 30
1,500
20
1,000
10
500

0 0
Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13

QUERY 3,826 3,523 2,802 2,893 2,142 1,603 1,922 1,701 2,418 1,981

REQUEST 982 975 836 780 695 538 671 559 876 718

COMPLAINT 32 29 7 25 60 29 52 19 7 11

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Client Feedback Survey Communicating with

October 2012 to October 2013 (Average) the General Public
5.50
4.85 4.86 4.84 4.86 4.92 4.90 4.88 4.91 4.92
5.00 4.77 4.77 4.80 4.75 4.84

4.50

4.00

3.50

3.00

2.50

2.00 An Ongoing Concern

To build public confidence in
1.50

1.00

deposit insurance system

1 2 3 4 5 6 7 8 9 10 11 12 13 14
OFFICES/FACILITIES SYSTEMS/PROCEDURES PERSONNEL 14 – Overall
1 – Cleanliness 5- Clarity (Filing of Claims) 9 – Courtesy Quality of
2 – Accessibility 6- Clarity (Complying w/ 10- Competence Service
3 – Complementary Requirements) 11- Efficiency
Services 7 – Promptness of Service 12-Proper and Pleasing Appearance
4 – Ventilation and Lighting 8 – Hassle-free processing 13- Ability to Communicate
of docs 41 42

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 Public Awareness Program
CORPORATE WEBSITE
PDIC Public Awareness Program (PAP)

• The website [www.pdic.gov.ph] provides

PDIC Public Awareness Program information about PDIC and its programs.
Objectives :
• To raise the level of public
awareness on PDIC and the deposit
insurance system; and
• To sustain the level of satisfaction
of depositors serviced during
claims settlement operations

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Public Awareness Program Public Awareness Program

CORPORATE WEBSITE
FINANCIAL LITERACY INITIATIVES FOR THE DEPOSITING PUBLIC

The website [www.pdic.gov.ph] provides information • Be a Wise Saver (BAWS Campaign)

on the waited average interest rate (WAIR) on time Students
deposits of all commercial banks, promoting safe
banking practices.
.

Local Government Employee

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Public Awareness Program Public Awareness Program

FINANCIAL LITERACY INITIATIVES FOR THE DEPOSITING PUBLIC FINANCIAL LITERACY INITIATIVES FOR THE DEPOSITING PUBLIC

TOOLS FLYERS and POSTERS KEY MESSAGES

▪ PDIC mandate, importance of saving

INFO DISSEMINATION METHODOLOGIES ▪ The Seven Habits & Wise Saver
▪ PDIC – organized Be a Wise Saver Roadshows 1. Know your bank

– symposium / lecture type 2. Know your bank products

– speakers from PDIC & partners 3. Know your bank’s services and fees
4. Keep your bank records safe and updated
▪ FSF / Central Bank Financial Literacy Roadshows 5. Transact only inside the bank with authorized personnel
for students & working professionals
6. Be informed about PDIC deposit insurance
▪ Paid newspaper advertisement 7. Be prudent

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Public Awareness Program Public Awareness Program
FINANCIAL LITERACY INITIATIVES FOR THE DEPOSITING PUBLIC FINANCIAL LITERACY INITIATIVES FOR THE DEPOSITING PUBLIC

• PDIC Basic Secondary Education Module Development • PDIC-Commission on Higher Education (CHED)-
Project (in cooperation with the Department of Philippine Council of Deans and Educators in Business
Education and Culture) (PCDEB) Tripartite Linkage
• Financial literary project for
public high school students • Financial literacy project for
• Teachers’ Guide in the subjects university students
Values Education and Economics • PDIC established a
was launched in 2005 Memorandum of
• Distributed to 5,500 public Understanding with the CHED
schools, benefited 6.3 M high and PCDEB for the inclusion of
school students annually financial literacy, savings
consciousness, responsible
• Expanded to cover private high schools in 2007, and was translated banking and deposit insurance
to English. in the basic Finance subject of
• Discussions ongoing for update of the Teachers’ Guide to incorporate the Business Administration
capital markets concept course.
• Project won the 1st Gawad Pampublikong Korporasyon Award by • Benefited 500,000 college students enrolled in business courses
the Office of Government Corporate Counsel 49 50

Public Awareness Program Public Awareness Program

FINANCIAL LITERACY INITIATIVES FOR THE DEPOSITING PUBLIC PARTNERSHIP WITH FINANCIAL REGULATORS

• Financial Literacy Guidebook

• Financial Sector Forum and multilateral committees
Launched on June 20, 2013 during the IADI Exco Meeting and
International Conference • Supervision of Financial Conglomerates Committee
• Supervision Methodology and Regulatory Policy
Coordination Committee
• Reporting, Information Exchange and Dissemination
Committee
• Consumer Protection and Education Committee
• Financial Stability Coordinating Council
• Memorandum of Agreement on Information Exchange with
the Bangko Sentral ng Pilipinas (BSP)
The guidebook aims to educate the vulnerable sectors of society to • Financial Exposition roadshows of the BSP
handle their hard-earned savings. The handbook will cater to
overseas Filipino workers (OFWs) and their families and beneficiaries,
retirees, senior citizens & the academe
Initial distribution through partnership with Social Security System
(SSS) and Government Service Insurance System (GSIS) 51 52

Public Awareness Program Public Awareness Program

COORDINATING WITH BANKERS COORDINATING WITH BANKERS

• Bankers associations’ meetings /dialogues / briefings • PDIC Regulatory Issuance 2009-01 requires banks to
prominently display PDIC official signs on maximum
• Compliance Officers’ Training course on BSP/PDIC deposit insurance coverage and PDIC membership,
Regulatory Issuances prominently and continuously
• Compendium of Regulatory Issuances and Bulletins
Decals & stickers
Prominently and
continuously posted at
Standee / desktop
entrances of authorized Prominently and
banking units continuously displayed
at teller’s counter/s or
window/s

The PDIC Official Sign

Prominently and continuously posted /
displayed at the ATM site or shown
electronically / digitally on ATM screen

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 End of Presentation
Thank You for Listening

eeoller@pdic.gov.ph 55

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