Philippine Deposit Insurance Corporation (PDIC) President Jose C. Nograles said that the state deposit insurer wants all options for rehabilitation scrapped during the receivership period for closed banks.

“Bank rehabilitation should be undertaken during the prompt corrective action (PCA) phase. I am in the opinion that PCA is the period to correct the deficiencies of a bank and that bank rehabilitation is part of strengthening efforts. Hence, it should be made at that point and not after bank closure.” Nograles said.

The outright liquidation of banks ordered closed by the Monetary Board is included in the package of proposals PDIC is pushing for to amend the Charter of the Bangko Sentral ng Pilipinas (BSP).

The PDIC President said that when a bank is ordered closed, rehabilitation is no longer a viable option due to the negative financial condition of the bank. Unlike ordinary corporations that do not have a PCA phase, banks are regulated, examined and undergo PCA when there are findings by the regulator of certain weaknesses requiring immediate action by the bank owners and officials.