Which entity liquidated Dresrossa Bank due to financial reverses?

Which entity liquidated Dresrossa Bank due to financial reverses?

• A. Bangko Sentral ng Pilipinas
• B. Securities and Exchange Commission
• C. Philippine Deposit Insurance Corporation
• D. Insurance Commission

Answer: (A)

When a bank in the Philippines becomes insolvent, the resolution process involves both institutions but in different roles. The central bank (BSP) oversees banks, can take supervisory actions, and may close or place a bank under receivership to protect the financial system. The actual liquidation—the winding down of the bank’s affairs, selling assets, and paying out insured deposits—is handled by the Philippine Deposit Insurance Corporation (PDIC). PDIC administers deposit insurance, pays insured depositors, and conducts the bank’s orderly liquidation. So, the entity responsible for liquidating a failed bank is PDIC. The Bangko Sentral ng Pilipinas may initiate or oversee resolution, but the liquidation itself is carried out by PDIC.

When a bank in the Philippines becomes insolvent, the resolution process involves both institutions but in different roles. The central bank (BSP) oversees banks, can take supervisory actions, and may close or place a bank under receivership to protect the financial system. The actual liquidation—the winding down of the bank’s affairs, selling assets, and paying out insured deposits—is handled by the Philippine Deposit Insurance Corporation (PDIC). PDIC administers deposit insurance, pays insured depositors, and conducts the bank’s orderly liquidation.

So, the entity responsible for liquidating a failed bank is PDIC. The Bangko Sentral ng Pilipinas may initiate or oversee resolution, but the liquidation itself is carried out by PDIC.