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[PRESIDENTIAL DECREE NO. 1897, (1984-01-11)](
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[ PRESIDENTIAL DECREE NO. 1897, January 11, 1984 ]


WHEREAS, it is the declared policy of the State to encourage the accumulation of savings and deposits in banks in recognition of the immense contribution of these funds mobilized by banks in the socio-economic development of the country;

WHEREAS, the deposit insurance system was conceived to generate more faith and confidence in the banking system by providing immediate relief to bank depositors in the event of bank failures;

WHEREAS, under R.A. No. 3591 enacted in June 1963, the Philippine Deposit Insurance Corporation was established to administer an insurance system for bank deposits;
WHEREAS, under prevailing circumstances, there is a felt need to increase the insurance coverage from its present amount of P15.000 per depositor;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of the Philippines, by virtue of the powers in me vested by the Constitution, do hereby order and decree the further amendment of Republic Act No. 3591, as amended, as follows:

SECTION 1. Section three (g) of Republic Act Numbered Three Thousand Five Hundred Ninety-One, as amended, is hereby amended to read as follows:

"SEC. 3(g) The term 'insured deposit' means the net amount due to any depositor for deposits in an insured bank (after deducting offsets) less any part
thereof which is in excess of forty thousand pesos (P40.000). Such net amount shall be determined according to such regulations as the Board of Directors may prescribe and in determining such amount due to any depositor, there shall be added together all deposits in the bank maintained in the same capacity and the same right for his benefit either in his own name or in the name of others.

SECTION 2. Section six (i) of the same Act is hereby amended to read as follows:

"Sec. 6(i) Trust funds held by an insured bank in a fiduciary capacity whether held in trust or deposited in any other department or in another bank shall be insured like other forms of deposits, in an amount not to exceed P40,000 for each trust estate, and when deposited by the fiduciary bank in another bank such trust funds shall be similarly insured to the fiduciary bank according to the trust estates represented. Notwithstanding any other provision of this Act, such insurance shall be separate from and additional to that covering other deposits of the owners of such trust funds or the beneficiaries of such trust estates: Provided, That where the fiduciary bank deposits any of such trust funds in other insured banks, the amount so held by other insured banks on deposit shall not for the purpose of any certified statement required under subsections (b) and (c) of this section be considered to be a deposit liability of the fiduciary bank, but shall be considered to be a deposit liability of the bank in which such funds are so deposited by such fiduciary bank. The Board of Directors shall have the power by regulation to prescribe the manner of reporting and of depositing such trust funds."

SECTION 3. Section ten (a-1) of the same Act is hereby amended to read as follows:

"Sec. 10(a-l) The permanent insurance fund hereinabove created is hereby increased to twenty million pesos and for this purpose, the amount of fifteen million pesos is hereby appropriated from the General Fund: Provided, that the maximum amount of the insured deposit of any depositor is hereby increased to forty thousand pesos (P40.000)."

SECTION 4. This Decree shall take effect immediately.

Done in the City of Manila, this 11th day of January, in the year of our Lord, nineteen hundred and eighty-four.