Manila: The Department of Finance (DOF) announced that the PHP107-billion funds remitted by the Philippine Deposit Insurance Corporation (PDIC) to the national government are unrestricted and will not impact the PDIC’s reserve funds. These funds, comprising cash and investment balances, are free for other uses and are net of restricted funds.

According to Philippines News Agency, the PDIC retains a reserve fund worth PHP250 billion, known as the Deposit Insurance Fund (DIF). This fund is reserved for specific uses like deposit insurance payouts and financial aid to banks in emergencies. The DIF represents at least 5.5 percent of the country’s insured deposits, aligning with the PDIC Board’s target range of 5 to 8 percent.

Finance Secretary Ralph Recto emphasized the adequacy of the DIF, stating that it is above international standards. The DOF assured the public that the withdrawal of excess funds would not affect the PDIC’s reserve funds, confirming that the DIF remains sufficient to cover banking system risks and maintain effective service delivery.

Data from the DOF indicates that as of November last year, the PDIC paid PHP282.31 million for deposit insurance claims. The corporation provisions PHP3.0 billion monthly to sustain the DIF and its ratio level.

The DOF previously stated that the PDIC remittance has significantly funded various infrastructure and social programs. These include the maintenance and rehabilitation of infrastructure facilities, protective services for individuals in crisis, the Philippine Food Stamp Program, disaster-related infrastructure projects, and rural electrification initiatives.

Additionally, the remitted funds have supported counterpart financing for foreign-assisted projects. These projects encompass the Panay-Guimaras-Negros Island Bridges, Metro Manila Subway Project, Mindanao Inclusive Agriculture Development Project, and several others aimed at enhancing infrastructure and sectoral development across the Philippines.

Finance Secretary Recto expressed a preference for obtaining more dividends from performing government-owned and controlled corporations (GOCCs) over increasing taxes or borrowing.