Can the liquidator of a distressed bank prosecute and defend suits against the bank and foreclose mortgages for and in behalf of the bank while the issue on receivership and liquidation is still pending?

Yes. The Central Bank is vested with the authority to take charge and administer the monetary and banking systems of the country and this authority includes the power to examine and determine the financial conditions of banks for the purpose of closure on the ground of insolvency. Even if the bank is questioning the validity of its closure, during the pendency of the case the liquidator can continue prosecution suits for collection and foreclosure of mortgages, as they are acts done in the usual course of administration of the bank. (Banco Filipino v. Central Bank, G.R. No. 70054, Dec. 11, 1991)