THE Court of Appeals (CA) has stopped the Philippine Deposit Insurance Corp. (PDIC) from pushing through with the public bidding, auction, sale, disposal and transfer of properties, assets and credits under the name of Banco Filipino Savings and Mortgage Bank (Banco Filipino).
In a 13-page decision penned by Associate Justice Ronaldo Roberto Martin, the CA’s Tenth Division found grave abuse on the “precipitate haste” on the part of the PDIC in putting 133 assets of Banco Filipino out for bid. The court noted the issue on the validity of the resolution of the Bangko Sentral ng Pilipinas’s Monetary Board (BSP MB) placing the bank under receivership is still pending before the Supreme Court (SC).
The CA pointed out that the PDIC, as liquidator of Banco Filipino, wanted to enforce its findings that the latter is insolvent and could no longer function as bank without awaiting the SC’s decision on whether the regulator’s resolution is valid.
“In the instant case, the status quo wherein the assets are not sold pending the ruling of the [SC] as to the validity of placing [Banco Filipino] under receivership is but safe and proper. Should it be otherwise and allow the sale even if the Supreme Court has yet to decide on its validity would render [Banco Filipino] without any asset and money if the [High Tribunal] later on rules that placing it under receivership was invalid,” the CA explained.
The appeals court ordered the PDIC to “desist from selling the assets of Banco Filipino covered under the liquidation proceeding before the Regional Trial Court of Makati City, Branch 66, pending final determination of the [SC] in G.R. 210249.”
Court records showed that a petition has been filed by the stockholders of Banco Filipino questioning the validity of BSP MB 372-A, which placed the bank under receivership.
The SC has yet to finally decide on the petition, which has been pending since 2011.
The ruling stemmed from the petition filed by Banco Filipino stockholder Ekistics Philippines Inc. seeking to enjoin the PDIC from disposing the bank’s assets.
Ekistics said that the BSP should be enjoined from disposing of Banco Filipino’s assets until the question on the propriety of its closure and liquidation has been resolved with finality.
Court records showed Banco Filipino was incorporated on June 25, 1964, with a term of 50 years or until June 25, 2014.
It was closed in 1985 but was reopened nine years later, after the SC declared the closure illegal and directed the BSP to allow the bank to resume its business operations.
On March 17, 2011, the BSP MB placed Banco Filipino under receivership of PDIC and then ordered its liquidation on October 27, 2011, after determining that it cannot continue its business without involving probable losses to its depositors and creditors.