By Eileen A. Mencias

Philippine Deposit Insurance Corp. is tapping a P14-billion loan from the Bangko Sentral to pay the deposit claims of banks closed in the past six weeks, banking sources said.

PDIC also borrowed from the central bank in the third quarter of last year to pay claims of depositors of Golden Seven, or G7 Bank, which had some P3 billion in deposits.

The central bank closed 18 rural banks in the last six weeks, including 13 linked with the Legacy group of former National Home Mortgage Finance Corp. president Celso de los Angeles.

Deposits in the Legacy group of banks alone total some P14 billion. Rural Bank of Para?aque, the flagship of the group, was the first among the banks to be closed and put under PDIC receivership on Dec. 9. It had P9 billion in deposits.

Fear of lawsuits prevented the central bank from moving in to close the banks earlier but the declaration of a banking holiday gave regulators sufficient grounds to shut them down.

The central bank closed 14 other banks in December: Rural Bank of Nueva Caceres in Naga City; Pilipino Rural Bank in Cebu; Rural Bank of Bais in Negros Oriental; Rural Bank of San Jose in Batangas; Bank of East Asia, formerly Banco Rural de Bisayas in Minglanilla, Cebu; First Interstate Bank in Kananga, Leyte; Philippine Countryside Rural Bank, also in Cebu; Dynamic Bank, formerly Rural Bank of Calatagan in Batangas; San Pablo City Development Bank, also in Batangas; Nation Bank; Rural Bank of Carmen, Cebu; Rural Bank of DARBCI in Polomolok, South Cotabato; BDB Bank Inc., formerly the Bicol Development Bank; and Community Rural Bank of San Joaquin in Iloilo.

The Bangko Sentral had been monitoring the Legacy group of banks because of its aggressive deposit taking, offering depositors extremely high yields.

BDB Bank, meanwhile, sought a temporary restraining order from the Court of Appeals on Jan. 5. BDB Bank is seeking indemnification from the central bank, blaming it for the losses it sustained.

It claimed that its losses ballooned since it entered the prompt corrective action framework of regulators that effectively gave the central bank management of the bank.

The central bank this month closed three more banks: Rural Bank of Sta. Rita and Rural Bank of Bacolor in Pampanga, and Rural Bank of Subangdaku, Mandaue.

The central bank recently issued a new regulation to prevent banks from actively soliciting deposits with the promise of high yields that are unsustainable. The new regulation classifies aggressive deposit taking with the offer of high yields that are unsustainable as an unsafe and unsound banking practice, and make banks and its officers liable.