The Insurance Commission is seeking the help of Bangko Sentral ng Pilipinas (BSP) to investigate United Coconut Planters Bank (UCPB) on the lender’s alleged negligence and mismanagement of the trust fund deposits of pre-need firm Provident Plans International Corp.
“The Insurance Commission wrote a letter to BSP Governor Nestor A. Espenilla Jr. requesting that a fact-finding investigation be conducted on UCPB in connection with the handling of the trust fund deposits of Provident Plans,” Insurance Commissioner Dennis B. Funa said in a statement over the weekend.
“This request was prompted by the letter from Siguion Reyna Montecillo and Ongsiako Law Offices, counsel of Provident Plans, to the Insurance Commission alleging that UCPB committed gross negligence and fraudulent mismanagement of Provident Plans’ trust fund deposits, which resulted in the impairment of the required capital and deficiency in required trust fund of the said pre-need company.”
“Upon evaluation of Provident Plans’ request, we deemed it proper to refer the same to the BSP considering that the regulatory and supervisory powers over UCPB is vested upon it,” Funa added. “Nevertheless, we required UCPB to submit to us their reply on the allegations of Provident Plans.”
Last month, the Department of Finance said the Insurance Commission may place Provident Plans under conservatorship due to its poor financial state.
Based on the Insurance Commission’s assessment, Provident Plans had P340.6 million in capital impairment on top of P284 million in trust fund deficiency as of December last year.
The DOF had quoted the Insurance Commission as claiming that “the primary cause of [Provident Plans’] capital impairment and trust fund deficiency is the unrecoverable investment with its previous trustee bank, the Export and Industry Bank (EIB), and the neglect by its new trustee bank, the UCPB, in protecting the trust fund.”
“Provident Plans told the Insurance Commission that it has regularly met with its new trustee bank – UCPB – but the latter apparently did not do anything to protect the trust fund investment of the pre-need firm in EIB,” Funa was quoted by the DOF as saying in June.
For its part, UCPB said in a statement Sunday that it “welcomes the initiative of the Insurance Commission as this will allow the bank to clarify its position.”
“The bank reiterates that its trust banking group exercised prudence in managing the [Provident Plans’] account, well within sound banking practices and prevailing regulations of the BSP,” UCPB added.
“We shall provide the central bank all the information it needs so it can study the issue closely,” UCPB spokesperson Ildefonso R. Jimenez said. “We are confident that the BSP will affirm UCPB’s due diligence as a trustee bank.”
Provident Plans sells education, memorial, and pension plans, with 70 percent of its sales comprised of life policies. It currently has 38,000 plan holders.
Funa had said that “while Provident Plans manifested before the Insurance Commission in February and March this year that it has a ‘white knight’ investor to cover up its capital impairment and trust fund deficiencies, it has yet to receive any concrete plan or letter of intent from this supposed investor.” /atm
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.
For feedback, complaints, or inquiries, contact us.
All Credit Goes There : Source link