Establishment
On June 22, 1963, PDIC was created through Republic Act No. 3591.[3] The law provided the following:
In 1969, membership to PDIC became compulsory for all banks through Republic Act No. 6037. In 1970, PDIC started collecting the maximum assessment rate of 1/undefined of 1% of net assessable deposits per annum.
In the same year, the first payout was given to the Rural Bank of Nabua, as authorized by the Board. On July 6, 1970, initially one claim agent was assigned to handle the payout, although a transfer deposit scheme with the Rural Bank of Rinconada was later arranged to facilitate claims payment.
In 1978, Presidential Decree No. 1451 was issued, which increased the maximum deposit insurance coverage was increased to ₱15,000 per depositor.
- Deposit insurance coverage for banks
- Maximum deposit insurance of ₱10,000 per depositor[5]
- Maximum assessment rate of 1/undefined of 1% assessable deposits per annum
- Voluntary insurance membership with PDIC
- Permanent deposit insurance fund at ₱5,000,000[5]
- Formation of a three-member Board of Directors
1980s
In 1984, Presidential Decree No. 1897 was issued, which again increased the maximum deposit insurance coverage to ₱40,000 per depositor. In the same year, the following reforms were undertaken through Presidential Decree No. 1940:
In 1988, the World Bank report on strengthening the financial sector was completed and recommended a greater role for PDIC in the supervision and examination of banks and in handling distressed banks. The World Bank recommended PDIC to be appointed as the mandatory receiver and liquidator of closed banks, and its financial and manpower resources reinforced. As a result, PDIC had taken the following actions:
In 1989, liquidity pools were set up to contribute to the stability in the rural banking system by immediately addressing temporary liquidity requirements of rural banks. Under this scheme, rural banks contributed a portion of their liquid assets, which the Land Bank of the Philippines matched. The funds were invested in high-yielding, risk-free government securities, which can be availed of by member rural banks in the event of liquidity crisis. PDIC also maintained a credit line in case more funds are needed. After four years, there were already 27 liquidity pools created composed of 429 rural banks.
- PDIC made a preferred creditor over unsecured creditors
- Trust accounts excluded from insurance coverage
- Minimum assessment premium paid by banks set at ₱250
1990s
In the following year, PDIC joined a World Bank mission, with then-Central Bank of the Philippines and Land Bank of the Philippines, that created the Countryside Financial Institutions Enhancement Program (CFIEP) aimed at transforming rural banks into formidable agents of countryside development. The program helped rural banks to reduce burden of debt to CB, raise capital, attain economies of scale and become more competitive in the banking system. CFIEP Module 1 provided for infusion of fresh equity from existing stockholders and new investors. Module 2 focused on incentives in enhancing capital, while Module 3 provided incentives for merging and consolidation.
Republic Act No. 7400 was enacted on April 13, 1992, amending Republic Act No. 3591,[3] and providing, among other changes:
Also in 1992, PDIC established an office building at 2228 Pasong Tamo Street, Makati City.
In 1996, innovations were adopted to facilitate claims payment, including:
- Increased maximum deposit insurance coverage to ₱100,000 from ₱40,000[3]
- Adjusted assessment rate to a maximum of 1/undefined of 1% of total deposit liabilities
2000s
In 2004, the institution made amendments with the goal of protecting depositors from loss. Republic Act No. 9302, or the Amendments to the PDIC Charter, was passed into law.[3] The amendments aimed to provide heightened depositor protection. Major provisions included:
Single digit turnaround time in claims settlement operations from bank takeover was achieved for all banks closed during the year, with average turnaround time at 8 days.
PDIC, as liquidator, completed 78 final projects of distribution (POD) for closed banks. POD refers to the specific distribution plan of a closed bank's assets and is submitted to the Liquidation Court for approval.
Additional amendments took place in PDIC in 2009. The PDIC Charter was amended with the passage of Republic Act No. 9576[6] that took effect on June 1, 2009. The most significant provisions were:
During the year, the PDIC laid the foundation for new initiatives aimed at invigorating the banking sector, particularly rural banks, through the Strengthening Program for Rural Banks funded at ₱5 billion and the support program, the Investor-Investee Helpdesk.
The PDIC adopted the Corporate Governance Code and implemented the Citizen's Charter.
2020s
Effective March 15, 2025, the maximum deposit insurance coverage provided by the PDIC has been increased from ₱500,000.00 to ₱1,000,000.00 per depositor per bank. The increase in the maximum deposit insurance coverage was approved by the PDIC Board of Directors to provide enhanced protection and more confidence for the depositing public.[4]
