Supreme Court Ruling Awaited By Thrift Bank Depositors

Depositors of the closed Maximum Savings Bank are eagerly awaiting a decision from the Supreme Court that will allow them to recover funds currently withheld by the Philippine Deposit Insurance Corp (PDIC).

Efforts by Maxbank depositors to recover their funds from PDIC have been unsuccessful due to a pending case before the Supreme Court. I Photo: Philippine Deposit Insurance Corp (PDIC)

A total of P98.6 million in depositors' money remains unclaimed following the closure of Maximum Savings Bank by the Bangko Sentral ng Pilipinas (BSP) on November 8, 2019. This amount represents deposits exceeding P500,000, the maximum insured deposit amount which PDIC has already paid out.

Maximum Savings Bank, a five-unit thrift bank, was shut down due to financial irregularities uncovered by BSP examiners.

The bank's head office is located at 24 Antonio Pastor Bldg, P. Burgos St., Barangay 16 Poblacion, Batangas. It operated four branches in Muntinlupa City, Batangas City, Calapan City, and Puerto Galera in Oriental Mindoro.

As of June 30, 2019, the thrift bank held 3,487 deposit accounts with total deposit liabilities of P158 million, of which 38.34 percent, or P60.6 million, were considered insured deposits.

PDIC typically pays out deposits up to P500,000 immediately, as these are covered by insurance.

Efforts by depositors to recover their funds from PDIC have been unsuccessful due to a pending case before the Supreme Court. According to PDIC, the institution must await the High Court's decision before releasing funds exceeding the insured amount of P500,000.

One notable depositor, MyTreasure International Inc., has directly appealed to Chief Justice Alexander G. Gesmundo for assistance, urging a swift resolution of the case that is delaying their funds' release.

The pending case was filed by a former employee of the closed bank, and the Supreme Court's decision on this matter is crucial for the release of the depositors' funds.

MyTreasure International's corporate secretary and director, Patricia Ann Lorete, emphasized the prolonged financial strain on their business due to the withheld funds. "We are respectfully following up on the status of the case filed. We as depositors have had our funds held for over four years. These funds are vital to our business," Lorete stated.

Lorete also highlighted the severe impact of the COVID-19 pandemic on their operations, which has hindered their ability to repay suppliers and creditors. "Our fear is these vendors will begin legal proceedings, which we cannot afford to defend," she added.