A Obtained a Loan from Metrobank

A obtained a loan from Metrobank. As security, he delivered and deposit certificate maturing on April 29, 2011. A failed to pay, hence, the bank encashed the deposit certificate. A contended that it is pactum commissorium. Is A correct?

A) Yes, because the encashment is an automatic appropriation of the security.
B) A is not correct because the bank had yet to perform an act to appropriate the money deposited.
C) A is not correct because the act done was a matter of compensation. (BPI v. CA, 232 SCRA 302. Art. 1980, NCC)
D) A is correct because there can be no compensation since the relationship between the bank and A is one of deposit.