That You Might Have Life

That You Might Have Life

Jesus Christ is not a created being. He is the creator:
John 1:1 In the beginning was the Word, and the Word was with God, and the Word was God. 2 The same was in the beginning with God. 3 All things were made by him; and without him was not any thing made that was made.
God became flesh in the person of Jesus Christ:
John 1:14 And the Word was made flesh, and dwelt among us, (and we beheld his glory, the glory as of the only begotten of the Father,) full of grace and truth.
Man is morally depraved and incapable of pleasing God through works:
Isaiah 64:6 But we are all as an unclean thing, and all our righteousnesses are as filthy rags; and we all do fade as a leaf; and our iniquities, like the wind, have taken us away.
Man is spiritually dead and separated from God by sin: 
Romans 5:12 Wherefore, as by one man sin entered into the world, and death by sin; and so death passed upon all men, for that all have sinned.
Isaiah 59:2 But your iniquities have separated between you and your God, and your sins have hid his face from you, that he will not hear.
All men are born in sin and born spiritually blind and enemies of God:
Romans 8:7 Because the carnal mind is enmity against God: for it is not subject to the law of God, neither indeed can be.
Man is destined to stand before God and to receive judgement for sins:
Revelation 20:12 And I saw the dead, small and great, stand before God; and the books were opened: and another book was opened, which is the book of life: and the dead were judged out of those things which were written in the books, according to their works. 13 And the sea gave up the dead which were in it; and death and hell delivered up the dead which were in them: and they were judged every man according to their works.
Hell was NOT created for man, but for the angels who sinned:
2 Peter 2:4 For if God spared not the angels that sinned, but cast them down to hell, and delivered them into chains of darkness, to be reserved unto judgment;
When you die in your sin there is only one judgement:
Revelation 20:15 And whosoever was not found written in the book of life was cast into the lake of fire.
Mark 9:44 Where their worm dieth not, and the fire is not quenched.
Satan desires to lead all men into the same punishment that he is destined for:
1 Peter 5:8 Be sober, be vigilant; because your adversary the devil, as a roaring lion, walketh about, seeking whom he may devour.
Only the blood of Christ can restore the broken relationship between man and God:
Romans 5:10 For if, when we were enemies, we were reconciled to God by the death of his Son, much more, being reconciled, we shall be saved by his life.
Romans 3:23 For all have sinned, and come short of the glory of God; 24 Being justified freely by his grace through the redemption that is in Christ Jesus: 25 Whom God hath set forth to be a propitiation through faith in his blood, to declare his righteousness for the remission of sins that are past, through the forbearance of God;
Salvation cannot be earned, but you must accept it to receive it:
Ephesians 2:8 For by grace are ye saved through faith; and that not of yourselves: it is the gift of God: 9 Not of works, lest any man should boast.
When you have Jesus you have an advocate to plead your case before the Lord:
1 John 2:1 My little children, these things write I unto you, that ye sin not. And if any man sin, we have an advocate with the Father, Jesus Christ the righteous: 2 And he is the propitiation for our sins: and not for ours only, but also for [the sins of] the whole world.
Once you accept Christ the process of repentance begins and it is the Holy Spirit who begins it within you and it is He who shall finish it:
Philippians 1:6 Being confident of this very thing, that he which hath begun a good work in you will perform it until the day of Jesus Christ.
God has predestined us, but this does not mean that we have no free will.
What predestination means is that God has had a plan for us all since before time began. It is His will that we should walk in that perfect plan for our lives, but because of our own will we do stray from God's will.

God's predestined path for us is not something that we are forced to follow and so it does not mean that everything we do (good and bad) was God's predestined will for us. His will for us is for us to be completely obedient to Him and for us to walk in His perfect will, but we do not.

Because of the blood of Christ God does not judge us according to our deeds when we stray from His will. He judges us according to the justification of Jesus Christ if we be found in Christ.
If we are in Christ, then there is no more condemnation:
Romans 8:29 For whom he did foreknow, he also did predestinate to be conformed to the image of his Son, that he might be the firstborn among many brethren.
Romans 8:30 Moreover whom he did predestinate, them he also called: and whom he called, them he also justified: and whom he justified, them he also glorified.
Romans 8:1 There is therefore now no condemnation to them which are in Christ Jesus, who walk not after the flesh, but after the Spirit.
There is no more condemnation - this is true.

It is true IF you walk according to the spirit and to do that there must be repentance, which is to say a walking away from one's former life. 
This does not mean you will no longer sin:
1 John 2:1 My little children, these things write I unto you, that ye sin not. And if any man sin, we have an advocate with the Father, Jesus Christ the righteous.
1 John 1:8 If we say that we have no sin, we deceive ourselves, and the truth is not in us.

1 John is addressing people who have already received Christ.

There are two kinds of hearts
Those who acknowledge their need for a savior:
Acts 2: 36 Therefore let all the house of Israel know assuredly, that God hath made that same Jesus, whom ye have crucified, both Lord and Christ. 37 Now when they heard this, they were pricked in their heart, and said unto Peter and to the rest of the apostles, Men and brethren, what shall we do? 38 Then Peter said unto them, Repent, and be baptized every one of you in the name of Jesus Christ for the remission of sins, and ye shall receive the gift of the Holy Ghost.
And those who are too proud:
Acts 5:30 The God of our fathers raised up Jesus, whom ye slew and hanged on a tree. 31 Him hath God exalted with his right hand to be a Prince and a Saviour, for to give repentance to Israel, and forgiveness of sins. 32 And we are his witnesses of these things; and so is also the Holy Ghost, whom God hath given to them that obey him. 33 When they heard that, they were cut to the heart, and took counsel to slay them.
In these two cases above Peter and then Steven are addressing fellow Jews. They are imploring Jews to repent of their unbelief in Christ.

Do you have an Acts 2 heart or do you have an Acts 5 heart?
The mystery of salvation and the need for it is deeper than the deepest mysteries of the universe.

Those who mock are truly foolish. Rather than trying to make sense of salvation, just accept Christ by faith.
Humble yourself before Him and admit your weakness and utter wretchedness before the Holy God. Ask Him to forgive you and begin your new life following Jesus. 

It is God's desire to reconcile all of us unto Himself. I cannot explain why God has designed salvation the way He has any more than I can explain how He constructed time and space. Consider that.

Modern man has been made proud by unbelief.

Modern man thinks himself a god, when he is fragile and his life fleeting.

You shall stand before the almighty God one day and give an account for yourself.
You will have no defense once you have rejected Jesus Christ. 
Those of us who have accepted Christ can fall away from God if we stop talking with him and studying his word. In time we may begin to doubt God and our own salvation. The farther we get from God the deeper we fall into unbelief. 
We are told to help each other stay on the path that Jesus has set for us:
Hebrews 3:13 But exhort one another daily, while it is called To day; lest any of you be hardened through the deceitfulness of sin.
Before you go too far, think back to the time when you first received Christ. Once again, right then, at that very moment you need to stop and get down on your knees and ask God to forgive you. Humble yourself immediately. I know it may be difficult. I know that pride creeps in and unbelief rises up. But it is important to maintain a spirit of humility and sorrow for our sin.

Philippines PDIC Insurance Coverage

PDIC Info For Expats Banking In Philippines

This article is not professional advice. These are the opinions of a layman. No guarantee can be made about the accuracy or factual nature of any information found in this article. 

Table Of Contents

PDIC: The Philippine Depository Insurance Corporation

If you plan on relocating to the Philippines, then PDIC is something that you need to know about and understand. PDIC functions in much the same way as the FDIC in the US. 
If you have money in a Philippine bank, then it is likely that in whole or in part it is covered by PDIC. 

Like The FDIC, There Is A Maximum PDIC Coverage Per Depositor

Effective June 1, 2009, the maximum deposit insurance coverage is P500,000 per depositor. All deposit accounts by a depositor in a closed bank maintained in the same right and capacity shall be added together.
At current exchange rates that's about $10,000.
There are certain cases that expand coverage and those scenarios are discussed below.

Exceptions To PDIC Account Coverage

R.A. No. 9576 stipulates that PDIC will not pay deposit insurance for the following accounts or transactions:
  1. Investment products such as bonds, securities and trust accounts;
  2. Deposit accounts which are unfunded, fictitious or fraudulent;
  3. Deposit products constituting or emanating from unsafe and unsound banking practices;
  4. Deposits that are determined to be proceeds of an unlawful activity as defined under the Anti-Money Laundering Law.

PDIC Coverage Scenarios 

Another similarity to FDIC is the fact that joint accounts are insured separately from any individually-owned deposit account. So a married couple can have up to 2,000,000 PHP in a single bank and it can all be insured under PDIC in four separate accounts with two held individually and two held jointly and each account containing the 500,000 PHP maximum because:

A joint account regardless of whether the conjunction "and", "or", "and/or" is used, shall be insured separately from any individually-owned deposit account/s.

Even so, I would not put that many eggs in one basket.

Exercise caution with joint accounts. If you carefully study the PDIC scenarios and explanations you will find that the P500,000 limit applies on a per account basis. If you have more than P500,000 in a single account, then that excess will not be covered. This is regardless of how many joint account holders own the account or how much coverage they have left over from other joint accounts they may hold. 

PDIC provides some useful tools for you to determine exactly what can be covered across various scenarios. The PDIC coverage scenarios are a good primer for showing you how certain hypothetical account scenarios would be covered (or not covered), but the best tool is the PDIC calculator which allows you to input details of exactly how you want to create your accounts and it will show you what is and is not covered.

Be careful about accounts in multiple banks, because sometimes what appears to be different banks is actually the same bank, so if the parent fails, then your different accounts get added together and you lose. 

Bank Failure 

Bank failure in the Philippines does not seem to be any more common than it is in the US - just my anecdotal opinion. But it does happen. Most of the time it will be the smaller banks, like rural banks that fail. In my near decade in the Philippines I have never had any personal experience with any kind of bank failure nor do I know anyone who has.

I learned only after the the fact that we may have dodged a bullet back in the 2011/2012 time-frame when we had significant accounts with PNB. Back then, when PNB was in the process of merging with Allied Bank, PNB was considered to be borderline insolvent: 

Philippine National Bank (PNB) has a borderline insolvency ratio of 153.50% as of June 30, 2012, down 6.03% from 163.35% as of March 31, 2012. 

Allied Bank was in better financial shape than PNB and since that time PNB has steadily improved. I do not believe that PNB would have ever been allowed to fail, because it is one of the biggest and oldest banks in the Philippines. The failure of PNB would have cost the Philippines a great deal of economic confidence at home and abroad. 

Filing A PDIC Claim

If your bank fails, then you must file a claim with PDIC within 24 months. Otherwise you forfeit your right to file a claim. However you may still be able to make a claim against the assets of the bank. This is also the case if you have a balance over the insured limit. Filing a claim against bank assets is not guaranteed to be a success and even if successful there will be costs associated and much time spent and still no guarantee that you will get back all or any of your money. Such claims must be filed with the liquidator of the closed bank within sixty (60) days from publication of notice of closure. Keep in mind that there will most likely be a long line of other creditors that may be ahead of you.

To limit loss and hassle, keep all accounts within the insured limits and promptly file a claim in case of bank failure.

Time-Frame For PDIC To Pay Claims

The claim for insured deposit should be settled within six (6) months from the date of filing provided all requirements are met but the claim must be filed within twenty-four (24) months after bank takeover. The six-month period shall not apply if the documents of the claimant are incomplete or if the validity of the claim requires the resolution of issues of facts and law by another office, body or agency, independently or in coordination with PDIC.
Notice the phrase "should be settled within six (6) months." They use the word "should" rather than "shall" because the word "shall" would be your guarantee that your claim would be settled within six months. In this case "should" indicates that we all hope that is the case, but perhaps it is not. 

Unsafe And Unsound Banking Practices 

Be familiar with these "unsafe/unsound" banking practices that MIGHT place a financial institution in danger of losing PDIC coverage:
  1. Solicitation and acceptance of deposits outside bank premises. 
  2. Solicitation and acceptance of deposits outside  bank premises. 
  3. Non-compliance with the minimum identification and documentation requirements for depositors for opening of deposit accounts. 
  4. Failure to keep bank records  (printed  and/or  electronic) within the bank premises. 
  5. Recording deposits or withdrawals without legitimate supporting documents 
  6. Offering and accepting high cost deposits despite the Cease and Desist Order issued by the Monetary Board. 
  7. Granting high interest rates when the bank has (i) negative unimpaired capital and (ii) either a liquid assets-to- deposits ratio of less than 10% or an operating loss. 
  8. Allowing depositors to deposit directly into the bank’s deposit account/s with other banks without implementing controls. 
  9. Allowing unauthorized bank personnel and non-bank personnel to handle deposit transactions. 
  10. Failure to reconcile inter-branch deposit transactions or deposit float items within 7 banking days.
  11. Allowing depositors to deposit, withdraw, and/or transfer funds without proper documentation such as a duly accomplished deposit or withdrawal slip or debit/credit memo, or its equivalent. 
  12. Making, use or issuance of bank advertisements, marketing proposals or strategies, and other similar statements or issuances, which directly or indirectly offer, promise, represent, or promote: (a) a separate and distinct PDIC  deposit  insurance cover for deposit accounts maintained in the same right and capacity of a depositor, either in his own name or in the name of others who have no beneficial ownership over the account/s; or (b) deposit insurance coverage that is inconsistent with and otherwise violative of the laws, rules and regulations and/or policies on beneficial ownership and deposit splitting. 
  13. Failure to adopt a Board-approved Operations Manual (OM) on Deposit Record  Keeping and/or submission of an inadequate OM that does not reflect deposit practices. 
  14. Allowing bank employees to process their own deposit transactions including those of their relatives up to fourth degree of consanguinity or affinity.

The Deposit Insurance Fund

The Deposit Insurance Fund is the fund that PDIC uses to pay out covered accounts. The Deposit Insurance Fund is composed of three parts:

The Deposit Insurance Fund (DIF) is the capital/equity account of the Corporation and consists of the following: (a) the permanent insurance fund; (b) reserves for insurance losses; and (c) retained earnings. The DIF shall be maintained at a reasonable level to ensure capital adequacy.

This information came from Financial Highlights, Page 11 under f.2 Equity, located under the Site Map on the PDIC website.

Page 4, Statements of Financial Position, shows a total equity of 147,150,186,499 PHP for these three components. This is the total amount of cash available to pay out in case of bank failures.

Within the PDIC Quarterly Deposit Trend for December 2018, on page 1 we find that total deposits as of December 2018 amount to 12.7453 trillion PHP (figures are given in billions so 12,745.3 billion PHP = 12.7453 trillion PHP).

The graphics and tables on page 4 show that 96.3% of 62.9 million total accounts are at or below the 500,000 PHP coverage limit. But these 60.5 million fully covered accounts only account for 11.8% of total deposits, leaving 11.178 trillion PHP in deposits only partially covered. We know that this 11.178 trillion PHP is held by 2.3 million accounts (table 5), so multiplying 2.3 million accounts by the 500,000 PHP limit we can know that of the 11.178 trillion PHP only 1.15 trillion PHP is covered by PDIC. Adding this to the 1.504 trillion in fully insured accounts gives us a total of 2.654 trillion PHP that is covered by PDIC insurance.

As stated earlier (from the Financial Highlights document) the total equity in the Insurance fund is 147.15 billion PHP. This amount is approximately 5.5% of total insured deposits. This is not atypical. The US mandated reserve is 1.35% and in practice they run about 2%. But the US stated maximum insured deposit is also 25 times that of the Philippines (at current exchange rates), being $250,000 as opposed to the Philippines' 500,000 PHP (~$10,000).

Bank Balance Sheet 

Banks are required by law to make their balance sheet publicly available. The big Philippine banks usually publish these on their website and are also required to publish it in the newspaper. Rural banks may post them on premises or in other conspicuous locations. Full details of balance sheet publishing requirements can be found on the PDIC website.

The items I scan for on the balance sheets are assets, liabilities, nonperforming assets (NPA) and the Capital Adequacy Ratio (CAR). 

I want to compare the assets to the liabilities and also see how the two compare over time. What were they on the previous quarterly reports. Have there been big changes? Is capital adequate to cover liabilities? The NPL (non performing loan) ratio is usually around 1.5% for a healthy bank. With COVID19 it is trending up and is above 2% as of September 2020.

I also want to know about nonperforming assets. NPAs are loans that have not been paid in 90 days or more and they are broken into two categories: gross NPAs and net NPAs. Gross NPAs are the total of all NPAs, whereas net NPAs is the amount of badloans for which the bank has no cover or provision.

There is always going to be a certain percentage of  NPAs, but in general gross NPAs are held to about 10% of total loans. Any more than that or if they is an uptrend across quarterly reports and I will be concerned. I would be concerned about putting my money into any bank with more than a couple of % gross NPAs.

CAR formula

Capital adequacy ratios (CARs) are a measure of the amount of a bank's core capital expressed as a percentage of its risk-weighted asset.
Capital adequacy ratio is defined as:
{\mbox{CAR}}={\cfrac {\mbox{Tier 1 capital + Tier 2 capital}}{\mbox{Risk weighted assets}}}
TIER 1 CAPITAL = (paid up capital + statutory reserves + disclosed free reserves) - (equity investments in subsidiary + intangible assets + current & brought-forward losses)
TIER 2 CAPITAL = A) Undisclosed Reserves + B) General Loss reserves + C) hybrid debt capital instruments and subordinated debts where Risk can either be weighted assets (\,a) or the respective national regulator's minimum total capital requirement. If using risk weighted assets,
{\mbox{CAR}}={\cfrac {T_{1}+T_{2}}{a}} ≥ 10%.[1]
The percent threshold varies from bank to bank (10% in this case, a common requirement for regulators conforming to the Basel Accords) and is set by the national banking regulator of different countries.
Two types of capital are measured: tier one capital (T_{1} above), which can absorb losses without a bank being required to cease trading, and tier two capital (T_{2} above), which can absorb losses in the event of a winding-up and so provides a lesser degree of protection to depositors.
The CAR is important because it shows that a bank has taken basic steps to shore up funds against risk. The higher the CAR the better prepared the bank is to deal with unexpected loss. The minimum CAR is currently 10.5% under Basel III. A higher CAR is better. 

The Bottom Line 

For me, the plan is to limit exposure to potential loss as much as is possible. I only bring necessary cash into the country and the rest stays in the US. I keep my balances under the insured limit and these days I do not get too cute with spreading accounts across too many different banks. Having too many accounts is also a hassle when you do your FBAR and taxes. 

This post is my layman's understanding of PDIC as it pertains to my personal experience. As always, use caution and your better judgment in making financial decisions. And if you spot something incorrect or just plain dumb in this post, then please leave a comment so I can fix it.