FINANCE | PDIC plans risk-based bank deposit insurance assessments
Banks with stronger risk profiles may qualify for lower assessment rates, while the system is designed to encourage banks to strengthen governance, maintain adequate capital and improve risk management.
The Philippine Deposit Insurance Corporation (PDIC) is preparing to adopt a Risk-Based Assessment System (RBAS) that would tie banks’ deposit insurance assessments to their individual risk profiles, with full implementation targeted for 2028.
The proposed system was presented Aug. 5 during “PDIC 101: Understanding Deposit Insurance,” a press conference held with the Philippine Information Agency in Quezon City.
Under the current system, banks pay a flat assessment rate of one-fifth of 1% of their total deposit liabilities. The RBAS would instead consider factors including capital adequacy, liquidity, asset quality, governance, business model and supervisory assessments adopted by the Bangko Sentral ng Pilipinas.
Banks with stronger risk profiles may qualify for lower assessment rates, while the system is designed to encourage banks to strengthen governance, maintain adequate capital and improve risk management.
PDIC General Counsel Maria Antonette I. Brillantes-Bolivar, who heads the corporation’s RBAS working group, said the system would make assessments more closely reflect the risks posed by individual banks.
“The RBAS promotes fairness by ensuring that assessment rates better reflect a bank’s level of risk. It also encourages banks to strengthen governance, maintain adequate capital, and adopt sound risk management practices that contribute to a safer and more resilient banking system,” Bolivar said.
The proposed framework will combine financial and supervisory indicators to generate a composite risk score that will determine each bank’s assessment rate. PDIC said the system is being developed with advisory services from the World Bank Group and in consultation with the BSP and bank associations.
The reform is also aligned with the Core Principles for Effective Deposit Insurance Systems of the International Association of Deposit Insurers, which encourage risk-sensitive premium assessment frameworks.
PDIC plans to conduct a one-year shadow run before full implementation. During the shadow period, banks will continue paying the existing flat rate while receiving estimates of what their assessments would be under the RBAS.
The shadow run will also allow PDIC to test and refine the framework. Bank-specific assessments, simulated scores and risk ratings will remain confidential, while the system will include mechanisms for clarification, review and periodic recalibration.
The proposed change in assessment methodology will not alter the maximum deposit insurance coverage, which remains at P1 million per depositor, per bank.
Full disclosure: All news articles published on the TechSabado website are written by human journalists, unless otherwise specified. Final text editing is also performed by human editors, with artificial intelligence (AI) used only to assist with additional grammar and style guide corrections..
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