MANILA — The Philippine Deposit Insurance Corporation (PDIC) has expressed support for Senate Bill No. 1667, which seeks to amend its charter to enhance depositor protection and promote financial stability.

The proposed measure was filed by Senate President Vicente C. Sotto III and aims to amend Republic Act No. 3591, also known as the PDIC Charter, to reinforce the state deposit insurer’s institutional capacity to carry out its mandate.

“The PDIC welcomes the support of the Senate President in championing legislative reforms that would strengthen the country’s financial safety net and better protect the depositing public,” said PDIC President and CEO Roberto B. Tan.

PDIC noted that the maximum deposit insurance coverage (MDIC) has already been increased to P1 million per depositor per bank effective March 15, 2025. It said the proposed amendments would provide the legal framework for a more responsive and resilient deposit insurance system and enable the agency to act swiftly during financial crises.

The bill outlines a six-point legislative agenda, which includes expanding deposit insurance coverage to non-bank financial institutions (NBFIs) supervised by the Bangko Sentral ng Pilipinas and cooperatives under the Cooperative Development Authority.

Under the proposal, insurance protection may also be extended beyond the current MDIC for accounts deemed socially or economically significant, such as retirement savings, payroll accounts, and settlement accounts. The agency said this would help reduce disruptions to communities and payment systems in case of bank closures.

The measure also mandates the prompt settlement of deposit insurance claims. Banks would be required to maintain accurate and comprehensive electronic deposit records, while PDIC would be exempted from Bank Secrecy Laws to facilitate faster verification and payouts. In contested bank closures, only a temporary restraining order or injunction issued by the Supreme Court could stop the payment of deposit insurance claims.

Another key provision seeks to ensure the exclusive use of the Deposit Insurance Fund (DIF) for paying insurance claims and extending financial assistance to distressed banks, preserving the fund for its intended purpose.

The bill likewise proposes granting PDIC authority to implement a temporary full deposit insurance coverage during systemic crises, subject to a determination by the Monetary Board of the Bangko Sentral ng Pilipinas. The agency said this would help maintain public confidence and prevent bank runs.

In addition, the proposed reforms aim to streamline the liquidation process of closed banks to facilitate quicker recovery for creditors and strengthen PDIC’s governance, operations, and workforce to effectively carry out its expanded responsibilities.

“These proposed measures are critical to strengthening depositor protection and reinforcing public confidence in the stability of the financial system. These will ensure our deposit insurance system is responsive to changing times and the Deposit Insurer has the much-needed tools and authorities that can be deployed during periods of crisis,” Tan said.

PDIC said it will continue to work closely with lawmakers, regulators, and industry stakeholders to push for the passage of the bill, which it expects will bolster depositor confidence and further enhance the stability of the country’s financial system.