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The Capital Adequacy Ratios Of Philippine Banks - March 31, 2014

|Includes:CKGOY, iShares MSCI Philippines ETF (EPHE)

The Capital Adequacy Ratios of Philippine Banks - March 31, 2014

A bank's Capital Adequacy Ratio is a measure of a bank's capital and financial strength. It is expressed as a percentage of a bank's risk weighted credit exposures. It is also known as the "Capital to Risk Weighted Assets Ratio (CRAR).

The general formula is as follows:

CAR = (Tier 1 Capital + Tier 2 Capital)/Risk Weighted Assets

Tier 1 Capital

Tier 1 CAR is the ratio of a bank's core or equity capital to its total risk-weighted assets. It measures financial strength from a regulator's point of view. Tier 1 Capital measures the bank's ability to absorb losses without a bank being required to cease trading.

The formula for Tier 1 Capital is as follows:

Tier 1 Capital = (Paid-up Capital + Statutory Reserves + Disclosed Free Reserves) - (Equity Investments in Subsidiary + Intangible Assets + Current & B/F losses)

Tier 1 CAR = Tier 1 Capital/Risk Weighted Assets

Tier 2 Capital

Tier 2 Capital is supplementary capital. It measures the ability of a bank to absorb losses in the event of a winding up and so it provides a lesser degree of protection to depositors.

The formula for Tier 2 Capital is as follows:

Tier 2 Capital = Undisclosed Reserves + General Loss Reserves + Hybrid Debt Capital Instruments and Subordinated Debts.

Risk Weighted Assets

Risk Weighted Assets are a bank's on balance sheet assets and off-balance sheet exposures, weighted according to risk. Different classes of assets have different risk weightings. For instance, cash on hand or a government bond has zero risk weighting and are subtracted from the total risk assets. A loan would have a 100% risk weighthing - it would be counted towards the total risk assets of the bank.

More information about this can be found here.

Minimum Capital Requirements

International Guidelines

Basel III is the global requlatory standard on bank capital adequacy, stress testing, and market liquidity risk agreed upon by the members of the Basel Committee on Banking Supervision.

Under Basel III, the minimum Common Equity Tier 1 Capital Ratio is 4.5%, Tier 1 Capital Ratio is 6.0%, conservation buffer is 2.5%, and the minimum Total CAR is 8.0%.

For more information on Basel III, read this.

BSP Guidelines

The BSP issued new BASEL III Implementing Guidelines that will take effect on January 1, 2014. Under the new guidelines:

"Banks must now meet specific minimum thresholds for so-called Common Equity Tier 1 (CET1) capital and Tier 1 (T1) capital in addition to the Capital Adequacy Ratio (NASDAQ:CAR). These regulatory thresholds effectively move banks worldwide to rely more on core capital instruments like CET1 and T1 issues. This is in lieu of hybrid instruments which did not fare well in the latest global crisis as far as absorbing losses. The ability to absorb losses is central to Basel III.
The BSP maintained the minimum Capital Adequacy Ratio (CAR) at 10.0 percent. In addition to CAR, the new framework sets a CET1 ratio of at least 6.0 percent and the Tier I capital ratio is at a minimum of 7.5 percent.
The new guidelines also introduce a capital conservation buffer of 2.5 percent which shall be made up of CET1 capital. In addition, banks which issued capital instruments from 2011 will be allowed to count these instruments as Basel III-eligible until end-2015

Under these guidelines, several Philippine Banks currently do not meet these guidelines as of March 31, 2014. The banks that fail to meet BSP's minimum capital requirements are as follows:

TOTAL CAR

 

  1. Bataan Savings and Loan Bank (Total CAR of 0.00%)
  2. The Real Bank (Total CAR of 3.94%)
  3. BPI Globe Banko Inc. (Total CAR of 6.77%)
  4. The Palawan Bank (Total CAR of 7.53%)
  5. Planters Development Bank (Total CAR of 8.32%)
  6. Rizal Commercial Banking Corporation (Total CAR of 9.91%)

Tier One CAR

 

  1. 1st Valley Bank (Tier One CAR of 0.00%)
  2. Bataan Savings and Loan Bank (Tier One CAR of 0.00%)
  3. Business & Consumers Bank (Tier One CAR of 0.00%)
  4. Enterprise Bank Inc. (Tier One CAR of 0.00%)
  5. Equicom Savings Bank, Inc. (Tier One CAR of 0.00%)
  6. Inter-Asia Development Bank (Tier One CAR of 0.00%)
  7. Maritime Savings Bank Corporation (Tier One CAR of 0.00%)
  8. Optimum Development Bank (Tier One CAR of 0.00%)
  9. The Real Bank (Tier One CAR of 3.04%)
  10. Planters Development Bank (Tier One CAR of 4.16%)
  11. BPI Globe Banko Inc. (Tier One CAR of 6.15%)
  12. Philippine Bank of Communications (Tier One CAR of 6.74%)
  13. The Palawan Bank (Tier One CAR of 7.10%)
  14. Sterling Bank of Asia Inc. (Tier One CAR of 8.03%)
  15. Security Bank Savings Corporation (Tier One CAR of 9.62%)

The Total CAR and Tier 1 CAR of Philippine Banks as of March 31, 2014 is as follows:(Banks that do not meet BSP's minimum capital requirements are highlighted in yellow):



Philippine Banking System
TOTAL CAR
March 31, 2014
     
     
  Type of Bank Total CAR
BATAAN SAVINGS AND LOAN BANK Thrift 0.00
THE REAL BANK (A THRIFT BANK) INC Thrift 3.94
BPI GLOBE BANKO INC A SAVINGS BANK Thrift 6.77
THE PALAWAN BANK (PALAWAN DB) INC Thrift 7.53
PLANTERS DEVELOPMENT BANK Thrift 8.32
RIZAL COMM'L BANKING CORP U/KB 9.91
UNITED COCONUT PLANTERS BANK U/KB 10.16
EQUICOM SAVINGS BANK INC Thrift 10.25
SECURITY BANK SAVINGS CORPORATION Thrift 10.51
COMSAVINGS BANK Thrift 10.68
PHIL BANK OF COMMUNICATIONS U/KB 10.80
UNION BANK OF THE PHILS U/KB 11.21
ALLIED SAVINGS BANK Thrift 11.70
ENTERPRISE BANK INC (A THRIFT BANK) Thrift 12.11
RCBC SAVINGS BANK INC Thrift 12.12
EAST WEST BANKING CORP U/KB 12.16
STANDARD CHARTERED BANK U/KB 12.55
STERLING BANK OF ASIA INC (A SAVINGS Thrift 12.75
SECURITY BANK CORP U/KB 13.21
PHIL POSTAL SAVINGS BANK INC Thrift 13.31
BDO UNIBANK INC U/KB 13.32
WEALTH DEVELOPMENT BANK CORPORATION Thrift 13.55
CHINA BANKING CORP U/KB 13.66
LAND BANK OF THE PHILIPPINES U/KB 13.68
WORLD PARTNERS BANK (A THRIFT BANK) Thrift 13.69
PENBANK INC (A PDB) (FORMERLY: PENINSULA Thrift 13.78
CHINA BANK SAVINGS INC Thrift 13.99
METROPOLITAN BANK & TCO U/KB 14.04
BPI FAMILY SAVINGS BANK INC Thrift 14.05
OPPORTUNITY KAUSWAGAN BANK INC (A MICROFINANCE Thrift 14.17
LUZON DEVELOPMENT BANK Thrift 14.94
BANK OF THE PHIL ISLANDS U/KB 15.09
1ST VALLEY BANK INC A DEVELOPMENT BANK Thrift 15.45
PHILIPPINE RESOURCES SAVINGS BANKING Thrift 16.02
ASIA UNITED BANK CORPORATION U/KB 16.06
PHIL SAVINGS BANK Thrift 16.38
PHIL NATIONAL BANK U/KB 16.51
HIYAS BANKING CORPORATION Thrift 16.66
HONGKONG & SHANGHAI BANKING CORP U/KB 16.71
LEGAZPI SAVINGS BANK INC Thrift 17.21
FARMERS SAVINGS & LOAN BANK INC Thrift 17.24
BATAAN DEVELOPMENT BANK Thrift 17.42
NORTHPOINT DEV'T BANK INC Thrift 17.50
VILLAGE BANK INC (A THRIFT BANK) Thrift 17.58
PRODUCERS SAVINGS BANK CORPORATION Thrift 17.88
DEVELOPMENT BANK OF THE PHIL U/KB 18.51
BPI DIRECT SAVINGS BANK INC Thrift 19.24
MAYBANK PHILIPPINES INC U/KB 19.69
MALAYAN BANK SAVINGS AND MORT BANK INC Thrift 19.94
PHILIPPINE VETERANS BANK U/KB 20.16
BANK OF COMMERCE U/KB 20.88
ROBINSONS BANK CORPORATION U/KB 20.92
CITIBANK, N.A. U/KB 21.20
CARD SME BANK INC A THRIFT BANK Thrift 22.76
MICROFINANCE MAXIMUM SB INC Thrift 23.20
ANZ BANKING GROUP LTD U/KB 23.60
DUMAGUETE CITY DEV BANK INC Thrift 23.94
MIZUHO BANK LTD - MANILA BRANCH U/KB 24.14
PHILIPPINE BUSINESS BANK INC A SAVINGS Thrift 24.24
UCPB SAVINGS BANK Thrift 25.06
BDO PRIVATE BANK, INC. U/KB 25.82
BANK OF CHINA LIMITED-MANILA BRANCH U/KB 25.93
METRO CEBU PUBLIC SAVINGS BANK Thrift 26.01
FIRST CONSOLIDATED BANK INC (A PDB) Thrift 26.38
DEUTSCHE BANK AG U/KB 27.14
KOREA EXCHANGE BANK U/KB 27.77
CITIBANK SAVINGS INC Thrift 27.89
CTBC BANK (PHILIPPINES) CORP U/KB 28.03
BUSINESS AND CONSUMERS BANK (A DB) Thrift 28.32
HSBC SAVINGS BANK(PHILS) INC Thrift 28.81
LIFE SAVINGS BANK INC Thrift 28.86
INTER-ASIA DEVELOPMENT BANK Thrift 29.63
CORDILLERA SAVINGS BANK INC Thrift 30.48
LEMERY SAVINGS & LOAN BANK, INC. Thrift 32.36
THE BNK OF TOKYO-MITSUBISHI UFJ LTD U/KB 32.49
UNIVERSITY SAVINGS BANK INC Thrift 34.15
PAMPANGA DEVELOPMENT BANK Thrift 34.54
MARITIME SAVINGS BANK CORPORATION Thrift 35.17
SUN SAVINGS BANK INC Thrift 39.74
PHIL TRUST COMPANY U/KB 40.06
TONGYANG SAVINGS BANK INC Thrift 43.27
MALASIQUI PROGRESSIVE SLB, INC Thrift 43.52
TOWER DEVELOPMENT BANK Thrift 43.56
QUEEN CITY DEVELOPMENT BANK INC OR QUEENBANK Thrift 45.20
DUNGGANON BANK (A MICROFINANCE THRIFT Thrift 46.40
MEGA INT'L COMM'L BANK CO LTD U/KB 47.34
PACIFIC ACE SAVINGS BANK INC Thrift 50.15
SAMPAGUITA SAVINGS BANK INC Thrift 50.67
PRIDE STAR DEVELOPMENT BANK INC Thrift 50.76
JP MORGAN CHASE BANK NATIONAL ASSN. U/KB 55.04
INTERNATIONALE NEDERLANDEN GROEP BK U/KB 55.88
BANK OF AMERICA N.A. U/KB 56.59
PROGRESS SAVINGS AND LOAN BANK INC Thrift 58.08
QUEZON COCONUT BANK INC (A THRIFT BANK) Thrift 59.34
BANK ONE SAVINGS AND TRUST CORP. Thrift 63.39
OPTIMUM DEVELOPMENT BANK INC Thrift 67.80
MERCHANTS SAVINGS & LOAN ASSN INC Thrift 71.08
CENTURY SAVINGS BANK CORPORATION Thrift 86.48
BANGKOK BANK PUBLIC CO LTD U/KB 86.71
AL-AMANAH ISLAMIC INVESTMENT BANK OF THE PHILS U/KB 118.77
UNITED OVERSEAS BANK PHILIPPINES Thrift 193.83
ISLA BANK(A THRIFT BANK) INC Thrift 200.60
BDO ELITE SAVINGS BANK INC Thrift 381.89
Click to enlarge




Philippine Banking System
Tier One CAR
March 31, 2014
     
     
     
Bank Type of Bank Tier One CAR
1ST VALLEY BANK INC A DEVELOPMENT BANK Thrift 0.00
BATAAN SAVINGS AND LOAN BANK Thrift 0.00
BUSINESS AND CONSUMERS BANK (A DB) Thrift 0.00
ENTERPRISE BANK INC (A THRIFT BANK) Thrift 0.00
EQUICOM SAVINGS BANK INC Thrift 0.00
INTER-ASIA DEVELOPMENT BANK Thrift 0.00
MARITIME SAVINGS BANK CORPORATION Thrift 0.00
OPTIMUM DEVELOPMENT BANK INC Thrift 0.00
THE REAL BANK (A THRIFT BANK) INC Thrift 3.04
PLANTERS DEVELOPMENT BANK Thrift 4.16
BPI GLOBE BANKO INC A SAVINGS BANK Thrift 6.15
PHIL BANK OF COMMUNICATIONS U/KB 6.74
THE PALAWAN BANK (PALAWAN DB) INC Thrift 7.10
STERLING BANK OF ASIA INC (A SAVINGS Thrift 8.03
SECURITY BANK SAVINGS CORPORATION Thrift 9.62
LAND BANK OF THE PHILIPPINES U/KB 10.11
UNITED COCONUT PLANTERS BANK U/KB 10.16
DEVELOPMENT BANK OF THE PHIL U/KB 10.24
RIZAL COMM'L BANKING CORP U/KB 10.49
METROPOLITAN BANK & TCO U/KB 10.69
COMSAVINGS BANK Thrift 10.71
UNION BANK OF THE PHILS U/KB 10.71
ALLIED SAVINGS BANK Thrift 10.76
EAST WEST BANKING CORP U/KB 11.31
RCBC SAVINGS BANK INC Thrift 11.41
CHINA BANK SAVINGS INC Thrift 11.68
STANDARD CHARTERED BANK U/KB 12.02
BDO UNIBANK INC U/KB 12.34
PHIL POSTAL SAVINGS BANK INC Thrift 12.41
WEALTH DEVELOPMENT BANK CORPORATION Thrift 12.48
PHIL SAVINGS BANK Thrift 12.63
SECURITY BANK CORP U/KB 12.66
CHINA BANKING CORP U/KB 12.75
PHIL NATIONAL BANK U/KB 12.77
BPI FAMILY SAVINGS BANK INC Thrift 13.18
WORLD PARTNERS BANK (A THRIFT BANK) Thrift 13.18
PENBANK INC (A PDB) (FORMERLY: PENINSULA Thrift 13.24
LUZON DEVELOPMENT BANK Thrift 13.87
BANK OF THE PHIL ISLANDS U/KB 14.22
PHILIPPINE RESOURCES SAVINGS BANKING Thrift 14.49
ASIA UNITED BANK CORPORATION U/KB 15.58
HONGKONG & SHANGHAI BANKING CORP U/KB 16.09
FARMERS SAVINGS & LOAN BANK INC Thrift 16.40
HIYAS BANKING CORPORATION Thrift 16.40
LEGAZPI SAVINGS BANK INC Thrift 16.64
VILLAGE BANK INC (A THRIFT BANK) Thrift 17.20
NORTHPOINT DEV'T BANK INC Thrift 17.50
BPI DIRECT SAVINGS BANK INC Thrift 18.41
PRODUCERS SAVINGS BANK CORPORATION Thrift 18.50
MAYBANK PHILIPPINES INC U/KB 18.60
MALAYAN BANK SAVINGS AND MORT BANK INC Thrift 19.24
BATAAN DEVELOPMENT BANK Thrift 19.42
PHILIPPINE VETERANS BANK U/KB 19.74
ROBINSONS BANK CORPORATION U/KB 20.24
BANK OF COMMERCE U/KB 20.33
CITIBANK, N.A. U/KB 20.51
ANZ BANKING GROUP LTD U/KB 23.13
MIZUHO BANK LTD - MANILA BRANCH U/KB 23.20
DUMAGUETE CITY DEV BANK INC Thrift 23.54
PHILIPPINE BUSINESS BANK INC A SAVINGS Thrift 23.59
UCPB SAVINGS BANK Thrift 24.39
BANK OF CHINA LIMITED-MANILA BRANCH U/KB 25.35
METRO CEBU PUBLIC SAVINGS BANK Thrift 25.37
FIRST CONSOLIDATED BANK INC (A PDB) Thrift 25.52
BDO PRIVATE BANK, INC. U/KB 25.60
DEUTSCHE BANK AG U/KB 26.83
CTBC BANK (PHILIPPINES) CORP U/KB 27.20
KOREA EXCHANGE BANK U/KB 27.38
CITIBANK SAVINGS INC Thrift 27.89
HSBC SAVINGS BANK(PHILS) INC Thrift 28.14
LIFE SAVINGS BANK INC Thrift 28.63
CORDILLERA SAVINGS BANK INC Thrift 29.91
THE BNK OF TOKYO-MITSUBISHI UFJ LTD U/KB 31.68
MICROFINANCE MAXIMUM SB INC Thrift 35.18
LEMERY SAVINGS & LOAN BANK, INC. Thrift 37.10
SUN SAVINGS BANK INC Thrift 38.86
PHIL TRUST COMPANY U/KB 39.66
TONGYANG SAVINGS BANK INC Thrift 43.27
MALASIQUI PROGRESSIVE SLB, INC Thrift 43.33
QUEEN CITY DEVELOPMENT BANK INC OR QUEENBANK Thrift 44.74
DUNGGANON BANK (A MICROFINANCE THRIFT Thrift 46.03
MEGA INT'L COMM'L BANK CO LTD U/KB 46.38
PACIFIC ACE SAVINGS BANK INC Thrift 50.08
JP MORGAN CHASE BANK NATIONAL ASSN. U/KB 54.88
INTERNATIONALE NEDERLANDEN GROEP BK U/KB 55.48
SAMPAGUITA SAVINGS BANK INC Thrift 55.56
BANK OF AMERICA N.A. U/KB 56.39
PROGRESS SAVINGS AND LOAN BANK INC Thrift 58.08
QUEZON COCONUT BANK INC (A THRIFT BANK) Thrift 58.69
BANK ONE SAVINGS AND TRUST CORP. Thrift 63.00
MERCHANTS SAVINGS & LOAN ASSN INC Thrift 71.31
PRIDE STAR DEVELOPMENT BANK INC Thrift 72.89
OPPORTUNITY KAUSWAGAN BANK INC (A MICROFINANCE Thrift 84.74
CENTURY SAVINGS BANK CORPORATION Thrift 85.44
BANGKOK BANK PUBLIC CO LTD U/KB 85.75
TOWER DEVELOPMENT BANK Thrift 107.99
PAMPANGA DEVELOPMENT BANK Thrift 117.85
AL-AMANAH ISLAMIC INVESTMENT BANK OF THE PHILS U/KB 118.14
UNIVERSITY SAVINGS BANK INC Thrift 124.50
UNITED OVERSEAS BANK PHILIPPINES Thrift 193.49
ISLA BANK(A THRIFT BANK) INC Thrift 200.37
CARD SME BANK INC A THRIFT BANK Thrift 280.92
BDO ELITE SAVINGS BANK INC Thrift 381.89
Click to enlarge

Source: bsp.gov.phbancofilipinofailure.blogspot.com/2014/0..." target="_blank">bancofilipinofailure.blogspot.com/2014/07/the-capital-adequacy-ratios-of.html

Stocks: EPHE, CKGOY