Bank Deposits Are Now Insured To P500,000

[Mr Lee]

My question is, is it not unsafe and unsound practices that put banks at risk in the first place? Is that not what happened in the US when banks loaned money to people who did not have the ability to pay it back. So would it not follow that any money in an failed bank will not be insured? PDIC won't pay claims on bogus depositsPhilippine Deposit Insurance Corp. warned deposits from

[TheMason]

My question is, is it not unsafe and unsound practices that put banks at risk in the first place? Is that not what happened in the US when banks loaned money to people who did not have the ability to pay it back. So would it not follow that any money in an failed bank will not be insured? PDIC won't pay claims on bogus depositsPhilippine Deposit Insurance Corp. warned deposits from

[Mr Lee]

Classic. You're deposits are now insured! (Unless we decide they're not)I'm sure they were referring to the things that happened at Legacy but who knows. I think if you've got a standard checking or savings account at a major bank you'd be ok. This is why I keep a small safety net of 50,000 pesos in the banks here. For living expenses, I pay the remittance company and take the 0.75 peso hit on the exchange rate. I'd rather do that then risk a large sum of money in an account here.Either way, its only about $10,000 so its not a huge amount of insurance anyway.

Yes it does seem the laws in the Philippines are always open to interpretation of the person who bends them the way they feel best for their needs.As for the deposits, one should never keep more than they can afford to lose. We have a US Citibank account and we use their ATM to withdraw money at a Philippine Citibank and we do not pay any service charge and also get a good rate, and when we can plan in advance, I write a US check and deposit it into our Philippine dollar account and in 21 days it clears, and then we take what we will need and have the money changer come to the bank to exchange it. No real exposure that way at all and I make sure the money changer sees the deposit slip for the full amount so no one is waiting for us when we leave the bank. Living off the ATM makes life easier and we try to slowly build up some extra cash to keep at home to be one step ahead of a purchase. I also use Philippine checks to buy large cost items and we have found most big stores will take our ATM card or check but will usually cash it before delivery until they got to know us and now trust us, well at least to some degree.