By TJ Burgonio
Philippine Daily Inquirer
A measure doubling the insurance coverage of deposits to P500,000 to shield them from any bank closures amid the global economic downturn was signed into law Wednesday.
President Gloria Macapagal-Arroyo signed Republic Act No. 9576 after handing out awards to 25 outstanding locators in the Philippine Economic Zone Authority at the World Trade Center in Pasay City.
Ms Arroyo did not deliver a message during the ceremony, which was witnessed by Senate President Juan Ponce Enrile, Sen. Juan Miguel Zubiri and lawmakers who authored the measure.
RA 9576 increases the maximum deposit insurance coverage provided by the Philippine Deposit Insurance Corp. (PDIC) to depositors from P250,000 to P500,000.
PDIC is a government corporation established in the 1960s to encourage savings in banks, protect insured deposits and draw idle funds into the banking system, among others.
At the P500,000 level, 97.2 percent of all deposit accounts will be fully covered by insurance, officials said.
Keep deposits in banksIn terms of absolute amounts, 31.7 percent of all deposits in the banking system will be covered by the higher insurance cap, up from 24 percent under the previous level.
The increase was designed to encourage the depositors to keep their deposits in banks and protect them as global recession sweeps across the world, officials said.
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