Document Type

Case Study

Case Series

Account Guarantee Programs

JEL Codes

G01, G28


At the height of the Global Financial Crisis in October 2008, moves by other countries to expand the scope of their bank deposit insurance led the Philippine government to consider similar measures. Unlike most countries, however, the government did not make the changes immediately. After a lengthy legislative process, the President signed a bill on April 29, 2009, doubling the Philippine Deposit Insurance Corporation’s (PDIC’s) coverage from PHP 250,000 to PHP 500,000 (about USD 5,300 to USD 10,600) per depositor, with any losses in excess of PHP 250,000 covered by the national government. The changes took effect on June 1, 2009. The mandatory insurance applied to all banks operating in the Philippines and included commercial, checking, savings, time, and thrift accounts. The PDIC’s Deposit Insurance Fund was very well-funded before the crisis, with assets to cover 6.1% of total estimated insured deposits at the end of 2007. Between June 1, 2009, and May 31, 2012, the PDIC reported internally that it paid 51,889 depositor accounts at 79 closed banks a total of PHP 12.8 billion. Government funding for deposits exceeding PHP 250,000 expired on May 31, 2012. The deposit insurance limit has remained at PHP 500,000 per depositor since 2009.

Date Revised