Senate Finance Committee head Senator Sonny Angara on Monday assured that the latest amendments to the Philippine Deposit Insurance Corporation (PDIC) charter will result in a stronger and more resilient banking system in the country.

Angara said the Senate's approval of Senate Bill No. 2365 on third and final reading before it went on a break, was a product of extensive consultations with the Bangko Sentral ng Pilipinas (BSP), the academe and stakeholders of the banking and financial sector.

The new PDIC charter, he said, will streamline the operation of the PDIC so it can focus on its core function of securing the deposits of the public by providing insurance coverage for banks.

From being an attached corporation of the Department of Finance (DOF), the PDIC will now be under the jurisdiction of the BSP.

“This move is logical considering that the PDIC deals with deposit insurance for banks and the BSP, as the country’s Central Bank, sets the monetary policy and has financial supervision over the banks," said Angara, author and sponsor of the bill.

"This will result in better coordination between the two bodies,” the lawmaker stressed.

Incidentally, history was also made in the passage of the bill as Angara and his father, the late former Senate President Edgardo J. Angara were both the sponsors of the latest amendments to the PDIC charter.

The former Senate president was credited with the last amendment to the PDIC charter through Republic Act 9576 in 2009, which raised the deposit insurance coverage from P250,000 to the current P500,000.

Senate Bill No. 2365 is now awaiting President Rodrigo Duterte's signature.

Under the new PDIC charter, the BSP Governor will now serve as the chairperson of the PDIC Board; the DOF Secretary, who previously served as ex-officio chairperson of the Board, will now act as the vice chairperson of the PDIC.

Angara said attaching the PDIC to the BSP will strengthen the cooperation between the two agencies, make their collaboration more efficient, and prevent the possible overlapping of their functions.

The measure also introduces the inclusion of certain products and arrangements of Islamic Banks under the ambit of the PDIC in accordance with the objectives of Republic Act 11439 or the law providing for the regulation and organization of Islamic Banks.

Also, the bill authorizes the PDIC to establish separate insurance funds and insurance arrangements in consideration of the Islamic Banking’s peculiar characteristics, and to issue rules and regulations for the establishment of the same.

“Our hope is that with these amendments to the PDIC charter, we help strengthen and make more resilient our banking sector, which will most definitely play a critical role in the coming years as we try to recover in the wake of the pandemic,” Angara said.