MANILA, Philippines – The Philippine Deposit Insurance Corporation (PDIC) remitted P107.23 billion of its “excess funds” to the national treasury to support government projects.

In a statement, the PDIC said its idle funds helped finance the following projects:

• Protective Services for Individuals and Families in Difficult Circumstances/Assistance to Individuals in Crisis Situations
• Philippine Food Stamp Program
• Panay-Guimaras-Negros bridges
• Metro Manila Subway
• Cebu-Mactan bridge
• North-South Commuter Railway
• Fisheries and Coastal Resiliency project

The PDIC assured depositors that its Deposit Insurance Fund or DIF is still enough to cover the risks of the banking system. Its president and chief executive officer Roberto Tan said the DIF stands at over P250 billion.

Rappler’s resident economist JC Punongbayan noted that this is a huge drop in the fund, as the PDIC’s annual report showed that the DIF stood at around P310.1 billion by the end of 2023.

Punongbayan also drew parallels from the transfer of P87 billion from the Philippine Health Insurance Corporation (PhilHealth) to the national treasury, and warned that taking funds from the PDIC could compromise the banking sector’s health. “These funds are not excess funds or surpluses that can be touched willy-nilly,” he said.

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The PDIC in its statement maintained that the remittance was made in compliance with the 2024 General Appropriations Act, which names fund balances from government-owned or -controlled corporations as potential sources of unprogrammed funds. (READ: The unprogrammed funds issue in the Marcos admin’s 2024 budget, simplified)

It also said the transfer was made in accordance with the opinion of the Office of the Government Corporate Counsel.

Tan noted that the PDIC is not covered by the Supreme Court’s temporary restraining order on the further transfer of PhilHealth funds to the treasury.

“That’s for PhilHealth…. It’s (PDIC transfer) not being challenged,” he said.

Tan assured the public that the transfer was a one-time move. He said the only other transfer the PDIC plans to make is the annual remittance of its dividends to the national government.

Raising maximum insurance

The PDIC is also planning to increase the maximum deposit insurance coverage from its current limit of P500,000, as part of efforts to adjust for inflation and enhance financial security for depositors.

Tan said the PDIC just completed a study on the possible increase. However, the PDIC board has yet to decide on the new insured amount.

He told reporters that the agency plans to announce the increase within the first half of 2025.

The PDIC last raised the maximum insured amount in 2009 from P250,000 per depositor per bank to the current P500,000.

“The present value of that now is not [the same P500,000] years ago,” Tan said.

He also said a new law is not needed to raise the insurance coverage since the PDIC’s charter, amended in 2022, allows the agency to adjust the ceiling due to inflation and other economic indicators. – with reports from Kaycee Valmonte/Rappler.com