Major Philippine bank sanctioned over fraud

MANILA: One of the Philippines’ biggest banks has been sanctioned over alleged fraud by one of its executives, the central bank said Tuesday.

The penalties were imposed on the Metropolitan Bank and Trust Company (MBTC) after one of its vice presidents was arrested in July on suspicion of stealing 1.75 billion pesos ($34.5 million) from the bank.

Some directors and officers at MBTC, better known as Metrobank, will also be suspended, the central bank said. Metrobank declined to name the suspended officials.

Metrobank is also required to set aside 4.45 billion pesos ($87.3 million) of its capital to cover for “higher operational risk” from any similar cases.

“The board and senior management accept accountability and command responsibility for the incident and commits to implementing the directives,” Metrobank said in a statement.

It stressed that an audit showed no customers were affected by the alleged fraud, describing it as an “isolated incident”.

The central bank said that in imposing the sanctions, its monetary board “took into consideration MBTC’s strong financial condition and immediate corrective actions to contain further financial damage.”