Rural Bank Run Spreads, 3 More Declare Holiday

[Mr Lee]

Rural bank run spreads, 3 more declare holiday01/08/2009 A run among Rural Banks (RBs) appear to be spreading after three banks, one in Dumaguete and two in Pampanga, recently declared holidays after experiencing massive withdrawals. The banks were apart from 10 banks of the Legacy Group that the Bangko Sentral ng Pilipinas (BSP) assumed control of after they declared bank holidays. The BSP then insisted that the collapse of the 10 banks were not at all related to a spreding global financial crisis since the banks were on its watchlist long before the crisis struck due to unsafe and unsound banking practices. The Rural Bank of Subangdako (RBS)-Dumaguete branch has closed shop after experiencing massive withdrawals of deposits the past weeks. RBS clients were caught by surprise upon seeing the notice posted at the bank premises yesterday, which said it has declared a bank holiday and was awaiting for the Philippine Deposit Insurance Corp. (PDIC) to assume control of the bank without stating the reasons. Two other rural banks in Pampanga, the Rural Bank of Bacolor and the Rural Bank of Sta. Rita declared bank holidays, according to the BSP. BSP Deputy Gov. Nestor Espenilla Jr. said the two Pampanga banks unilaterally declared holidays for reasons unrelated to issues hounding the Legacy Group of banks. �The Rural Banks of Bacolor and Sta. Rita are on holiday. They have related owners but they are not linked (to the Legacy Group), he said. Both banks were hounded by �management and governance issues uniquely their own, according to Espenilla. RBS-Dumaguete depositors trooped to the BSP office in Dumaguete to inquire about the status of the bank. The BSP branch in Dumaguete was not informed of the declaration of a bank holiday by RBS, according to Paulita Enrile, head of the BSP office in Dumaguete. The main RBS branch in Mandaue, Cebu, however, informed the BSP headquarters in Manila about the Dumaguete branch�s declaration of a bank holiday. Read the whole story, click the link below http://www.tribuneonline.org/business/20090108bus1.html

[Mr Lee]

PDIC fails to serve RB closure noticesSTA. RITA -- A seven-man takeover team from the Philippine Deposit Insurance Corporation (PDIC) arrived here Friday morning to serve the notice of closure to Rural Bank of Santa Rita, Inc. (RBSRI) and effect its receivership under the state-run insurance company.The takeover team, composed of accountants from the PDIC and two security personnel, left Manila around 6 a.m.But they could not locate any of the senior officers and employees of bank, putting the planned takeover into an "unexpected buffer." Leo Cabradilla, deputy receiver of RBSRI from the PDIC, said the closure order came from the Bangko Sentral ng Pilipinas (BSP) and the Monetary Board (MB) after the rural bank, along with "related bank" Rural Bank of Bacolor Inc. (RBBI) declared bank holidays last December 19 and 22, respectively. The planned closure would pave the way for the takeover of the bank's assets, records and other pertinent documents. Cabradilla however said the takeover could only start if they are able to locate the employees of the bank who will now have to work under the PDIC."We are going to serve the closure notice to the bank manager and start the assessment of the assets of the bank. Another team will arrive to assess if we can already process the deposit insurance claims of the depositors," Cabradilla told Sun.Star.The team tracked down some of the employees to their respective addresses, but most of them were "mysteriously" not in town. After two fruitless attempts to locate employees of the bank, the team withdrew to try diplomatic channels and called officials in Manila if they could serve the closure order to any RBSR official there.Bank employee Corazon Zapanta, according to Cabradilla, was reported to be in Manila.Cabradilla told Sun.Star that they were able to contact one of the employees of the bank and would serve the closure notice anytime Friday. But late afternoon, the PDIC official said they failed to serve the notice of closure.Cabradilla refused to elaborate on how they would proceed and conduct the takeover. He said they would process the deposit claims within week's time if they could serve the closure notice until Saturday, adding that another team will also be sent to take over RBBI.Read the whole story, click the link below.http://www.sunstar.com.ph/pampanga/pdic-fa...closure-notices

[Jollygoodfellow]

PDIC fails to serve RB closure noticesSTA. RITA -- A seven-man takeover team from the Philippine Deposit Insurance Corporation (PDIC) arrived here Friday morning to serve the notice of closure to Rural Bank of Santa Rita, Inc. (RBSRI) and effect its receivership under the state-run insurance company.The takeover team, composed of accountants from the PDIC and two security personnel, left Manila around 6 a.m.But they could not locate any of the senior officers and employees of bank, putting the planned takeover into an "unexpected buffer." Leo Cabradilla, deputy receiver of RBSRI from the PDIC, said the closure order came from the Bangko Sentral ng Pilipinas (BSP) and the Monetary Board (MB) after the rural bank, along with "related bank" Rural Bank of Bacolor Inc. (RBBI) declared bank holidays last December 19 and 22, respectively. The planned closure would pave the way for the takeover of the bank's assets, records and other pertinent documents. Cabradilla however said the takeover could only start if they are able to locate the employees of the bank who will now have to work under the PDIC."We are going to serve the closure notice to the bank manager and start the assessment of the assets of the bank. Another team will arrive to assess if we can already process the deposit insurance claims of the depositors," Cabradilla told Sun.Star.The team tracked down some of the employees to their respective addresses, but most of them were "mysteriously" not in town. After two fruitless attempts to locate employees of the bank, the team withdrew to try diplomatic channels and called officials in Manila if they could serve the closure order to any RBSR official there.Bank employee Corazon Zapanta, according to Cabradilla, was reported to be in Manila.Cabradilla told Sun.Star that they were able to contact one of the employees of the bank and would serve the closure notice anytime Friday. But late afternoon, the PDIC official said they failed to serve the notice of closure.Cabradilla refused to elaborate on how they would proceed and conduct the takeover. He said they would process the deposit claims within week's time if they could serve the closure notice until Saturday, adding that another team will also be sent to take over RBBI.Read the whole story, click the link below.http://www.sunstar.com.ph/pampanga/pdic-fa...closure-notices

I wonder why the employees would go missing,something to hide?

[TheMason]

I wonder why the employees would go missing,something to hide?

I think it's more likely that they needed more time to complete the transfer of assets off-shore and out of the reach of the PDIC.

Both banks were hounded by management and governance issues uniquely their own, according to Espenilla.

My opinion is that people have realized what a potential gold mine the PDIC is. All you need to do is open a bank, grow your deposit base, and then take off and leave PDIC holding the bag. I don't think the mgmt. and governance issues are unique to these banks at all. I think a systemic fleecing of govt. coffers via the PDIC is well under way.

[johnrxx99]

http://business.inquirer.net/money/topstor...d-in-rural-bankInteresting story. Looks like the Mayor of Lapu Lapu's wife was in charge when the banks lent 90% of the banks assets on fictious loans. No suprise there then.

[Jollygoodfellow]

http://business.inquirer.net/money/topstor...d-in-rural-bankInteresting story. Looks like the Mayor of Lapu Lapu's wife was in charge when the banks lent 90% of the banks assets on fictious loans. No suprise there then.

Just gets more interesting every day,how does anyone expect that they would get away with lending out 90% of the banks assets,if they weren't found out now eventually the bank would have folded anyway. :1 (103):

[Old55]

Perhaps she was shopping for more lamp posts.

http://business.inquirer.net/money/topstor...d-in-rural-bankInteresting story. Looks like the Mayor of Lapu Lapu's wife was in charge when the banks lent 90% of the banks assets on fictious loans. No suprise there then.

[tom_shor]

They couldn't find any employees. Did they check near the pillar of smoke in the back of the building? :1 (103):

[TheMason]

http://business.inquirer.net/money/topstor...d-in-rural-bankInteresting story. Looks like the Mayor of Lapu Lapu's wife was in charge when the banks lent 90% of the banks assets on fictious loans. No suprise there then.

Just gets more interesting every day,how does anyone expect that they would get away with lending out 90% of the banks assets,if they weren't found out now eventually the bank would have folded anyway. :1 (103):

What would make anyone think they would go to jail or get in any significant trouble for lending out 90% of the banks assets?Hmm....lets see. If I steal 1 billion pesos and earmark 70-80% of that money for lawyers, investigators, prosecutors, auditors, etc. and drag the case out until I find someone willing to dismiss it, I'm still ahead 200-300 million pesos. It's a win-win all the way around. Except of course for the taxpayers and depositors, but they don't really matter.

[johnrxx99]

Bloomberg have just run a video by an Advocate who thinks it is unlikely Madoff will do time. Even though he has breached the terms of his bail, the judge refuses to jail him pending trial.Not really setting a good example is it. Steal $50 billion and walk around your multi-million penthouse or steal $50 and get banged up, lol