PDIC wants revamp of claims processing scheme
11/10/2009 | 07:26 PM
Conceding that its systems were unable to handle the huge number of claims following the unprecedented spate of bank closures in December last year, state-run Philippine Deposit Insurance Corp. will overhaul its processing scheme.
In a statement, PDIC President Jose Nograles said he has ordered a review of the company’s systems relative to claims processing especially after the closure of 12 thrift banks under the controversial Legacy group.
“Admittedly, our claims systems and processes were not structured to cope with the voluminous number of accounts involved in the almost simultaneous closure of the 12 Legacy banks," Nograles said.
The 12 Legacy banks alone had deposits of around P14 billion in about 135,000 accounts. In comparison, all the 17 banks closed in the whole of 2007 had combined deposits of only P1.6 billion in over 68,000 accounts.
“No closures in past years since PDIC’s inception in 1963 had ever approached the breadth and depth of these closures, which are unparalleled in Philippine banking history. Not surprisingly, the Legacy closures challenged our systems and procedures as well as our resources," the PDIC chief said.
He explained that there was a need to overhaul the claims system in order to process huge numbers of accounts.
In addition to the 25 banks closed in 2008, the Monetary Board has closed 19 banks as of the first quarter of 2009.
“These successive closures have stretched PDIC’s resources to the limit," Nograles said.
PDIC, he said, remains committed to pay all valid deposit insurance claims.
Fraud allegations in the banks’ transactions also posed difficulties to seasoned examiners of PDIC.
PDIC has also sought the help of Prof. Ronaldo Polancos of the De La Salle University College of Industrial Engineering to undertake business process review of claims-related processes as well as simplification of documentary requirements.
Much earlier, PDIC engaged the services of internationally-affiliated audit firms to assist in the examination of the Legacy banks as well as the conduct of forensic investigation to uncover the fraud schemes used by these banks.
Digital imaging is also being planned for the tons of bank records used for the examination and validation processes in the interest of efficiency. - GMANews.TV
In a statement, PDIC President Jose Nograles said he has ordered a review of the company’s systems relative to claims processing especially after the closure of 12 thrift banks under the controversial Legacy group.
“Admittedly, our claims systems and processes were not structured to cope with the voluminous number of accounts involved in the almost simultaneous closure of the 12 Legacy banks," Nograles said.
The 12 Legacy banks alone had deposits of around P14 billion in about 135,000 accounts. In comparison, all the 17 banks closed in the whole of 2007 had combined deposits of only P1.6 billion in over 68,000 accounts.
“No closures in past years since PDIC’s inception in 1963 had ever approached the breadth and depth of these closures, which are unparalleled in Philippine banking history. Not surprisingly, the Legacy closures challenged our systems and procedures as well as our resources," the PDIC chief said.
He explained that there was a need to overhaul the claims system in order to process huge numbers of accounts.
In addition to the 25 banks closed in 2008, the Monetary Board has closed 19 banks as of the first quarter of 2009.
“These successive closures have stretched PDIC’s resources to the limit," Nograles said.
PDIC, he said, remains committed to pay all valid deposit insurance claims.
Fraud allegations in the banks’ transactions also posed difficulties to seasoned examiners of PDIC.
PDIC has also sought the help of Prof. Ronaldo Polancos of the De La Salle University College of Industrial Engineering to undertake business process review of claims-related processes as well as simplification of documentary requirements.
Much earlier, PDIC engaged the services of internationally-affiliated audit firms to assist in the examination of the Legacy banks as well as the conduct of forensic investigation to uncover the fraud schemes used by these banks.
Digital imaging is also being planned for the tons of bank records used for the examination and validation processes in the interest of efficiency. - GMANews.TV
