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By the Bohol Chronicle

A rural bank that shut its doors on Monday after experiencing heavy withdrawals since December has sought a rescue loan package from the Bangko Sentral ng Pilipinas (BSP) to save its operations.

The Rural Bank of Maribojoc Inc. (RBM) bore the domino effect of the closure of Pilipino Rural Bank (PRBank) Tagbilaran Branch last December 12, 2008 and other conglomerate rural banks under the Legacy Group.

According to an official of RBM, the bank got affected due to the closure of PRBank as deposits dropped to an all time low while withdrawals barraged the 31-year old rural bank located in Poblacion, Maribojoc.

"Operations had been smooth until our depositors turned anxious owing to the collapse of PRBank," said RBM board chairman Restituto Tan.

Officials from the Central Bank had been in constant talks with the rural bank's management for an emergency loan, reportedly somewhere between P15 million - P20 million, that would pull out RBM of its predicament, Tan confirmed.

In fact, two BSP representatives came last Friday to start processing the loan requirements.
         

Even as Tan is hopeful on the rural bank's application for loan, he said "the element of time depends on how fast central bank officials can grant the rescue loan".

"The central bank advised the management to wait," Tan said as he also appealed for patience among their depositors.

The banker said the government should be able to rescue distressed rural banks due to the closure of 13 Legacy banks which expectedly caused depositors to be apprehensive on the banks' operations.

LOAN IN THE PIPELINE

Antonieto Pernia, chief of staff of Gov. Erico Aumentado and an intermediary of the rural bank and the BSP, disclosed that the central bank representatives who visited here were "quite optimistic" that the loan will be granted.

Pernia said the BSP representatives disclosed that the central bank is willing to release an initial amount even while the documentary requirements are being complied with.

He said the initial figure was due for release and other personnel from the central bank will be here for the signing of loan documents.

Pernia said he introduced Tan to BSP officials who came to Bohol last month to supervise the convergence program of cooperatives in the province and the BSP.

It was during that meeting that Tan told the BSP officials that the rural bank needs cash infusion before its cash reserve is depleted, Pernia said.

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