CA won’t stop liquidation of Banco Filipino assets-A A +A
Friday, March 22, 2013
SOME depositors of the defunct Banco Filipino Savings and Mortgage Bank (BFSB) failed to get a favorable ruling from the Court of Appeals to stop the bank’s liquidation and sale of its assets.
In a resolution dated March 18, the CA said allowing the intervenors, who have deposits of P500,000 or more, will “unduly delay the adjudication of the rights of the original parties (stockholders).”
Weeks ago, intervenors led by St. Martin’s Foundation and other depositors said the regulations for receivership and liquidation under Republic Act 7653 or the New Central Bank Act of 1993 have not been followed.
They also questioned the hasty decision of the Bangko Sentral ng Pilipinas (BSP) in 2011 to padlock Banco Filipino for being insolvent, a financial condition when liabilities exceed assets. The groups said the closure order was not immediately relayed to the bank’s board.
“Banco Filipino’s illegal closure has effectively resulted in the BSP divesting depositors of their hard-earned savings and in the BSP depriving employees of their permanent means of livelihood, which at bottom is a serious deprivation of life and liberty,” the petition read.
BSP records show that Banco Filipino has 177,652 depositors, majority of which are small depositors fully entitled by deposit insurance of up to P500,000 each.
Banco Filipino was first closed down in 1985 for failing to pay its loans, according to the then Central Bank of the Philippines. But the Supreme Court ruled the closure illegal in 1991, allowing the bank to operate in 1994. (Virgil Lopez/Sunnex)