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Monday, May 21, 2018

Philippine Postal Savings Bank Ranks 1st in Non-Performing Loans as % of Stockholder's Equity as of December 31, 2017

Editor's Note: Data is culled from  the Published Statements of Condition of individual Philippine Banks found in www.bsp.gov.ph.  
This blog post updates previous blog posts such as Philippine Postal Savings Bank Ranks 1st in Non-Performing Loans as % of Stockholder's Equity as of September 30, 2017 .


NPLs.  Short for Non-Performing Loans.  The NPL Ratio or the ratio of a bank's Non-Performing Loans (NPL) to Total Loan Portfolio (TLP) is a frequently cited figure in the general media to indicate a bank's financial health or the health of the banking system as a whole.  See: "Banks reduce exposure to bad debts, have more cash to loan out—BSP".

In the Philippine Banking Industry, Gross Non-Performing Loans stood at Php 138.02 billion as of December 31, 2017 - approximately 1.58% of the Philippine Banking Industry's Total Loan Portfolio of Php 8.73 trillion.


 
Philippine Banking System
NPL as % of TLP
December 31, 2017











Gross NPL/ Gross TLP
Bank Gross NPLs Gross TLP (In %)
MAXIMUM SAVINGS BANK INC 9,301,471.34 12,261,436.83 75.86%
PHIL STAR DEVELOPMENT BANK INC 13,618,385.28 23,858,496.29 57.08%
PHIL POSTAL SAVINGS BANK INC 2,573,636,133.05 5,198,964,234.61 49.50%
MALASIQUI PROGRESSIVE SLB, INC 15,625,906.59 39,327,642.08 39.73%
UNIVERSITY SAVINGS BANK INC 143,068,589.00 471,577,575.89 30.34%
NORTHPOINT DEV'T BANK INC 135,617,693.05 453,969,831.51 29.87%
MARITIME SAVINGS BANK CORPORATION 23,615,730.12 116,465,682.85 20.28%
YUANTA SAVINGS BANK PHILIPPINES INC 111,281,975.24 562,447,462.39 19.79%
LEGAZPI SAVINGS BANK INC 331,930,878.48 1,757,567,652.33 18.89%
LUZON DEVELOPMENT BANK 572,886,788.42 3,555,619,201.27 16.11%
LIFE SAVINGS BANK INC 7,323,871.50 47,615,911.33 15.38%
HIYAS BANKING CORPORATION 39,024,897.61 269,795,964.37 14.46%
BATAAN DEVELOPMENT BANK 27,105,889.48 190,427,303.87 14.23%
ENTERPRISE BANK INC (A THRIFT BANK) 236,780,337.30 1,690,869,890.94 14.00%
PAMPANGA DEVELOPMENT BANK 51,370,076.92 378,461,155.83 13.57%
UCPB SAVINGS BANK 1,805,224,708.69 15,287,410,552.04 11.81%
EQUICOM SAVINGS BANK INC 581,351,331.19 5,469,854,661.55 10.63%
PHILIPPINE VETERANS BANK 1,940,400,491.73 18,991,915,993.92 10.22%
PHILIPPINE RESOURCES SAVINGS BANKING CORPORATION (PR SAVINGS 1,041,502,843.18 10,236,698,272.76 10.17%
CITYSTATE SAVINGS BANK INC 193,352,128.38 1,955,696,048.15 9.89%
1ST VALLEY BANK INC A DEVELOPMENT BANK 524,483,848.57 5,545,383,174.52 9.46%
METRO CEBU PUBLIC SAVINGS BANK 9,340,189.11 100,186,688.67 9.32%
BPI DIRECT BANKO INC A SAVINGS BANK 445,658,466.00 4,805,888,728.04 9.27%
PENBANK INC (A PDB) (FORMERLY: PENINSULA RB INC) 159,948,202.14 1,762,599,044.40 9.07%
BANK OF MAKATI (A SAVINGS BANK) INC 2,112,966,067.15 23,379,505,360.36 9.04%
FARMERS SAVINGS & LOAN BANK INC 18,781,070.83 219,057,952.05 8.57%
MALAYAN BANK SAVINGS AND MORT BANK INC 382,510,294.71 4,665,373,484.66 8.20%
THE PALAWAN BANK (PALAWAN DB) INC 20,627,309.35 272,272,875.52 7.58%
STANDARD CHARTERED BANK 2,621,936,475.60 36,251,787,258.89 7.23%
CORDILLERA SAVINGS BANK INC 13,111,997.34 193,549,638.87 6.77%
DUMAGUETE CITY DEV BANK INC 37,947,396.83 566,690,105.56 6.70%
CHINA BANK SAVINGS INC 3,926,539,784.17 64,643,959,926.83 6.07%
RCBC SAVINGS BANK INC 4,434,141,000.56 84,145,572,088.92 5.27%
BUSINESS AND CONSUMERS BANK (A DB) 8,282,870.65 160,107,332.73 5.17%
WEALTH DEVELOPMENT BANK CORPORATION 355,586,153.21 6,912,634,080.70 5.14%
LEMERY SAVINGS & LOAN BANK, INC. 4,270,287.78 87,978,770.09 4.85%
CENTURY SAVINGS BANK CORPORATION 35,875,505.12 778,828,053.49 4.61%
PHIL BANK OF COMMUNICATIONS 2,188,900,338.08 49,544,603,393.20 4.42%
EAST WEST BANKING CORP 9,194,973,447.66 209,759,096,474.62 4.38%
BANK ONE SAVINGS AND TRUST CORP. 49,944,276.09 1,196,206,671.14 4.18%
CITY SAVINGS BANK INC 2,547,279,274.47 66,909,698,638.55 3.81%
STERLING BANK OF ASIA INC (A SAVINGS BANK) 1,109,957,042.55 29,634,834,745.04 3.75%
QUEZON COCONUT BANK INC (A THRIFT BANK) 2,606,502.67 69,722,420.35 3.74%
PNB SAVINGS BANK 1,668,304,338.01 45,127,568,768.07 3.70%
UNION BANK OF THE PHILS 7,919,233,625.67 220,222,446,935.23 3.60%
BPI FAMILY SAVINGS BANK INC 7,510,125,483.03 213,038,220,759.99 3.53%
ALLBANK (A THRIFT BANK) INC 63,415,045.83 1,940,436,742.07 3.27%
FIRST CONSOLIDATED BANK INC (A PDB) 386,608,203.74 11,850,245,239.88 3.26%
PHIL SAVINGS BANK 4,770,532,359.83 148,184,807,646.02 3.22%
PACIFIC ACE SAVINGS BANK INC 723,612.00 23,001,261.00 3.15%
BANK OF COMMERCE 1,905,183,563.38 68,209,378,624.91 2.79%
UNITED COCONUT PLANTERS BANK 4,260,495,688.39 157,054,762,332.17 2.71%
SUN SAVINGS BANK INC 27,575,519.66 1,039,358,886.31 2.65%
PHIL TRUST COMPANY 1,235,274,115.70 48,802,019,296.70 2.53%
MERCHANTS SAVINGS & LOAN ASSN INC 24,490,163.18 1,068,340,051.01 2.29%
PRODUCERS SAVINGS BANK CORPORATION 235,827,682.71 11,078,447,959.21 2.13%
PHILIPPINE BUSINESS BANK INC A SAVINGS BANK 1,508,538,115.21 71,820,787,305.03 2.10%
MAYBANK PHILIPPINES INCORPORATED 1,505,097,676.36 73,466,177,798.08 2.05%
PHIL NATIONAL BANK 9,026,087,102.44 448,145,282,342.91 2.01%
DEVELOPMENT BANK OF THE PHIL 5,910,318,428.03 293,472,268,297.32 2.01%
CARD SME BANK INC A THRIFT BANK 76,379,195.49 4,006,726,996.82 1.91%
HSBC SAVINGS BANK(PHILS) INC 58,497,575.68 3,079,293,607.39 1.90%
INTER-ASIA DEVELOPMENT BANK 3,697,216.26 219,186,882.38 1.69%
QUEEN CITY DEVELOPMENT BANK INC OR QUEENBANK A THRIFT BANK 21,531,439.74 1,658,802,869.50 1.30%
ROBINSONS BANK CORPORATION 764,981,621.23 59,450,899,441.25 1.29%
CTBC BANK (PHILIPPINES) CORP 402,002,888.64 32,101,403,440.39 1.25%
HONGKONG & SHANGHAI BANKING CORP 716,358,593.37 68,281,724,586.13 1.05%
AL-AMANAH ISLAMIC INVESTMENT BANK OF THE PHILS 4,726,959.53 450,854,240.68 1.05%
RIZAL COMM'L BANKING CORP 2,850,646,633.56 272,104,211,932.58 1.05%
BANGKO KABAYAN INC (A PRIVATE DEVELOPMENT BANK) 17,218,615.00 1,677,028,726.17 1.03%
ASIA UNITED BANK CORPORATION 1,305,313,160.92 132,348,397,838.59 0.99%
LAND BANK OF THE PHILIPPINES 6,599,423,137.92 674,353,264,923.88 0.98%
BDO UNIBANK INC 17,044,080,200.52 1,743,923,345,525.46 0.98%
BANK OF THE PHIL ISLANDS 8,072,907,030.81 1,007,246,799,827.38 0.80%
CHINA BANKING CORP 2,923,249,111.15 407,502,702,756.47 0.72%
METROPOLITAN BANK & TCO 6,019,807,187.46 1,021,564,496,973.92 0.59%
SECURITY BANK CORP 2,126,420,967.47 372,291,931,741.06 0.57%
BANGKOK BANK PUBLIC CO LTD 32,996,077.60 5,786,996,476.44 0.57%
CITIBANK, N.A. 932,256,279.91 211,330,388,200.94 0.44%
KEB HANA BANK - MANILA BRANCH 28,043,200.72 6,721,785,797.17 0.42%
ING BANK N.V. 101.86 10,106,256,421.67 0.00%
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 0.00 17,628,357,049.33 0.00%
BANK OF AMERICA N.A. 0.00 10,144,085,779.05 0.00%
BANK OF CHINA LIMITED-MANILA BRANCH 0.00 12,672,319,415.31 0.00%
BDO PRIVATE BANK, INC. 0.00 7,997,195,349.97 0.00%
CATHAY UNITED BANK CO LTD - MANILA BRANCH 0.00 1,302,620,247.74 0.00%
DEUTSCHE BANK AG 0.00 23,658,822,226.66 0.00%
FIRST COMMERCIAL BANK LTD MANILA BRANCH 0.00 253,191,087.00 0.00%
INDUSTRIAL BANK OF KOREA MANILA BRANCH 0.00 1,650,060,851.82 0.00%
ISLA BANK(A THRIFT BANK) INC 0.00 598,294,827.52 0.00%
JP MORGAN CHASE BANK NATIONAL ASSN. 0.00 21,005,525,749.48 0.00%
MEGA INT'L COMM'L BANK CO LTD 0.00 10,569,704,018.82 0.00%
MIZUHO BANK LTD - MANILA BRANCH 0.00 61,861,937,320.48 0.00%
SHINHAN BANK - MANILA BRANCH 0.00 1,267,315,339.15 0.00%
SUMITOMO MITSUI BANKING CORPORATION-MANILA BRANCH 0.00 14,579,174,599.81 0.00%
THE BNK OF TOKYO-MITSUBISHI UFJ LTD 0.00 31,466,693,437.28 0.00%
UNITED OVERSEAS BANK LIMITED MANILA BRANCH 0.00 1,536,003,429.00 0.00%
HUA NAN COMMERCIAL BANK LTD MANILA BRANCH 0.00 0.00 NA
Grand Total 138,018,055,845.20 8,727,257,692,058.61 1.58%







There are six Philippine Banks with a Gross NPL Ratio greater than 25.00% of Total Loan Portfolio (TLP).  These are as follows:

  1. Maximum Savings Bank Inc (75.86% of TLP)
  2. Philippine Star Development Bank Inc (57.08% of TLP)
  3. Philippine Postal Savings Bank Inc (49.50% of TLP)
  4. Malasiqui Progressive SLB Inc (39.73% of TLP)
  5. University Savings Bank Inc (30.34% of TLP}
  6. Northpoint Development Bank Inc (29.87% of TLP)
 
The ratio of a bank's NPLs to its total Stockholders Equity (SE) maybe more important than the ratio of its NPLs to Total Loan Portfolio.  The idea behind this is that NPLs are fragile things.  As a loan deteriorates, its recoverable value will deteriorate as well.  A foreclosure will most likely result in a loan recovery that is a mere fraction of the loan's original value.  Therefore, banks with high NPL Ratios relative to their Stockholders Equity may face a significant loss of capital if a substantial amount of their NPLs are written off as a loss.



On an overall basis, the Gross NPLs of Philippine Banks amounted to 8.28% of Stockholders Equity as of December 31, 2017.



Philippine Banking System
NPL as % of SE
December 31, 2017









NPL SE NPL/SE
Bank (In PHP) (In PHP) (In %)
PHIL POSTAL SAVINGS BANK INC 2,573,636,133.05 842,001,759.20 305.66%
ENTERPRISE BANK INC (A THRIFT BANK) 236,780,337.30 253,723,993.77 93.32%
LUZON DEVELOPMENT BANK 572,886,788.42 656,264,864.47 87.30%
EQUICOM SAVINGS BANK INC 581,351,331.19 713,200,459.81 81.51%
THE PALAWAN BANK (PALAWAN DB) INC 20,627,309.35 28,282,539.35 72.93%
UCPB SAVINGS BANK 1,805,224,708.69 2,527,615,670.22 71.42%
MARITIME SAVINGS BANK CORPORATION 23,615,730.12 37,729,273.64 62.59%
LEGAZPI SAVINGS BANK INC 331,930,878.48 540,799,646.86 61.38%
PHILIPPINE VETERANS BANK 1,940,400,491.73 3,268,708,856.38 59.36%
PHILIPPINE RESOURCES SAVINGS BANKING CORPORATION (PR SAVINGS 1,041,502,843.18 2,369,540,365.73 43.95%
CHINA BANK SAVINGS INC 3,926,539,784.17 9,101,933,064.11 43.14%
STERLING BANK OF ASIA INC (A SAVINGS BANK) 1,109,957,042.55 2,659,580,815.51 41.73%
STANDARD CHARTERED BANK 2,621,936,475.60 6,461,203,931.41 40.58%
NORTHPOINT DEV'T BANK INC 135,617,693.05 356,004,174.33 38.09%
RCBC SAVINGS BANK INC 4,434,141,000.56 11,784,171,179.05 37.63%
UNIVERSITY SAVINGS BANK INC 143,068,589.00 411,771,626.31 34.74%
PAMPANGA DEVELOPMENT BANK 51,370,076.92 149,769,025.42 34.30%
PENBANK INC (A PDB) (FORMERLY: PENINSULA RB INC) 159,948,202.14 492,890,065.48 32.45%
MALAYAN BANK SAVINGS AND MORT BANK INC 382,510,294.71 1,188,581,878.15 32.18%
BATAAN DEVELOPMENT BANK 27,105,889.48 84,544,777.01 32.06%
1ST VALLEY BANK INC A DEVELOPMENT BANK 524,483,848.57 1,664,199,472.79 31.52%
MALASIQUI PROGRESSIVE SLB, INC 15,625,906.59 50,662,752.00 30.84%
BANK OF MAKATI (A SAVINGS BANK) INC 2,112,966,067.15 7,227,534,095.53 29.23%
BPI FAMILY SAVINGS BANK INC 7,510,125,483.03 26,687,511,311.24 28.14%
CITYSTATE SAVINGS BANK INC 193,352,128.38 697,461,737.09 27.72%
UNITED COCONUT PLANTERS BANK 4,260,495,688.39 17,397,558,815.10 24.49%
WEALTH DEVELOPMENT BANK CORPORATION 355,586,153.21 1,467,571,253.00 24.23%
EAST WEST BANKING CORP 9,194,973,447.66 38,620,925,589.08 23.81%
PHIL SAVINGS BANK 4,770,532,359.83 20,897,738,257.41 22.83%
HIYAS BANKING CORPORATION 39,024,897.61 171,657,550.61 22.73%
BPI DIRECT BANKO INC A SAVINGS BANK 445,658,466.00 2,047,202,631.66 21.77%
CITY SAVINGS BANK INC 2,547,279,274.47 13,744,848,979.28 18.53%
PHIL BANK OF COMMUNICATIONS 2,188,900,338.08 12,009,314,825.58 18.23%
METRO CEBU PUBLIC SAVINGS BANK 9,340,189.11 57,052,632.86 16.37%
PHILIPPINE BUSINESS BANK INC A SAVINGS BANK 1,508,538,115.21 10,187,187,378.11 14.81%
MAXIMUM SAVINGS BANK INC 9,301,471.34 64,034,475.98 14.53%
PNB SAVINGS BANK 1,668,304,338.01 11,503,184,041.59 14.50%
PHIL STAR DEVELOPMENT BANK INC 13,618,385.28 96,350,953.22 14.13%
FARMERS SAVINGS & LOAN BANK INC 18,781,070.83 132,992,180.75 14.12%
DUMAGUETE CITY DEV BANK INC 37,947,396.83 284,250,949.11 13.35%
PRODUCERS SAVINGS BANK CORPORATION 235,827,682.71 1,774,145,221.80 13.29%
DEVELOPMENT BANK OF THE PHIL 5,910,318,428.03 46,947,591,646.19 12.59%
BANK OF COMMERCE 1,905,183,563.38 15,746,839,708.73 12.10%
SUN SAVINGS BANK INC 27,575,519.66 232,213,068.73 11.88%
YUANTA SAVINGS BANK PHILIPPINES INC 111,281,975.24 942,387,007.15 11.81%
UNION BANK OF THE PHILS 7,919,233,625.67 67,773,383,482.01 11.68%
MAYBANK PHILIPPINES INCORPORATED 1,505,097,676.36 12,948,139,648.57 11.62%
LIFE SAVINGS BANK INC 7,323,871.50 70,816,478.86 10.34%
BUSINESS AND CONSUMERS BANK (A DB) 8,282,870.65 86,584,808.97 9.57%
CORDILLERA SAVINGS BANK INC 13,111,997.34 137,391,858.98 9.54%
FIRST CONSOLIDATED BANK INC (A PDB) 386,608,203.74 4,316,778,086.78 8.96%
BANK ONE SAVINGS AND TRUST CORP. 49,944,276.09 590,489,801.54 8.46%
CARD SME BANK INC A THRIFT BANK 76,379,195.49 920,636,294.74 8.30%
PHIL NATIONAL BANK 9,026,087,102.44 108,897,226,069.70 8.29%
ROBINSONS BANK CORPORATION 764,981,621.23 12,112,890,535.89 6.32%
LAND BANK OF THE PHILIPPINES 6,599,423,137.92 104,596,154,345.94 6.31%
ALLBANK (A THRIFT BANK) INC 63,415,045.83 1,020,711,669.47 6.21%
BDO UNIBANK INC 17,044,080,200.52 297,368,799,872.86 5.73%
CTBC BANK (PHILIPPINES) CORP 402,002,888.64 7,033,338,397.85 5.72%
INTER-ASIA DEVELOPMENT BANK 3,697,216.26 66,225,979.07 5.58%
PHIL TRUST COMPANY 1,235,274,115.70 23,979,055,109.03 5.15%
CITIBANK, N.A. 932,256,279.91 18,544,182,580.79 5.03%
LEMERY SAVINGS & LOAN BANK, INC. 4,270,287.78 85,354,098.57 5.00%
HONGKONG & SHANGHAI BANKING CORP 716,358,593.37 14,676,887,638.06 4.88%
ASIA UNITED BANK CORPORATION 1,305,313,160.92 26,881,201,566.71 4.86%
BANK OF THE PHIL ISLANDS 8,072,907,030.81 176,842,048,187.50 4.57%
QUEZON COCONUT BANK INC (A THRIFT BANK) 2,606,502.67 58,963,045.16 4.42%
RIZAL COMM'L BANKING CORP 2,850,646,633.56 66,891,627,479.35 4.26%
MERCHANTS SAVINGS & LOAN ASSN INC 24,490,163.18 613,220,402.50 3.99%
CHINA BANKING CORP 2,923,249,111.15 77,160,827,684.31 3.79%
CENTURY SAVINGS BANK CORPORATION 35,875,505.12 987,110,507.14 3.63%
BANGKO KABAYAN INC (A PRIVATE DEVELOPMENT BANK) 17,218,615.00 486,359,819.88 3.54%
HSBC SAVINGS BANK(PHILS) INC 58,497,575.68 1,655,388,144.52 3.53%
QUEEN CITY DEVELOPMENT BANK INC OR QUEENBANK A THRIFT BANK 21,531,439.74 654,541,579.78 3.29%
METROPOLITAN BANK & TCO 6,019,807,187.46 196,170,793,389.04 3.07%
SECURITY BANK CORP 2,126,420,967.47 103,433,294,420.92 2.06%
AL-AMANAH ISLAMIC INVESTMENT BANK OF THE PHILS 4,726,959.53 243,855,237.24 1.94%
KEB HANA BANK - MANILA BRANCH 28,043,200.72 1,675,545,705.46 1.67%
BANGKOK BANK PUBLIC CO LTD 32,996,077.60 3,173,866,408.07 1.04%
PACIFIC ACE SAVINGS BANK INC 723,612.00 74,525,853.83 0.97%
ING BANK N.V. 101.86 2,614,800,005.89 0.00%
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 0.00 4,186,671,243.23 0.00%
BANK OF AMERICA N.A. 0.00 2,096,035,697.20 0.00%
BANK OF CHINA LIMITED-MANILA BRANCH 0.00 2,599,040,906.95 0.00%
BDO PRIVATE BANK, INC. 0.00 5,348,567,459.72 0.00%
CATHAY UNITED BANK CO LTD - MANILA BRANCH 0.00 2,121,743,141.73 0.00%
DEUTSCHE BANK AG 0.00 2,455,572,028.55 0.00%
FIRST COMMERCIAL BANK LTD MANILA BRANCH 0.00 2,021,320,878.22 0.00%
HUA NAN COMMERCIAL BANK LTD MANILA BRANCH 0.00 2,069,461,976.42 0.00%
INDUSTRIAL BANK OF KOREA MANILA BRANCH 0.00 2,294,253,435.17 0.00%
ISLA BANK(A THRIFT BANK) INC 0.00 680,167,573.92 0.00%
JP MORGAN CHASE BANK NATIONAL ASSN. 0.00 1,340,894,840.65 0.00%
MEGA INT'L COMM'L BANK CO LTD 0.00 1,916,692,903.11 0.00%
MIZUHO BANK LTD - MANILA BRANCH 0.00 5,465,333,964.66 0.00%
SHINHAN BANK - MANILA BRANCH 0.00 2,210,389,217.63 0.00%
SUMITOMO MITSUI BANKING CORPORATION-MANILA BRANCH 0.00 12,852,741,885.32 0.00%
THE BNK OF TOKYO-MITSUBISHI UFJ LTD 0.00 4,665,723,811.53 0.00%
UNITED OVERSEAS BANK LIMITED MANILA BRANCH 0.00 2,340,838,059.36 0.00%
Grand Total 138,018,055,845.20 1,666,089,199,719.15 8.28%


Of the 98 banks in this list, twenty-two banks have a Gross NPL to Stockholders Equity Ratio of 30% or more as of December 31, 2017.  These banks are as follows:


  1. Philippine Postal Savings Bank Inc (305.66%  of SE)
  2. Enterprise Bank Inc (93.32% of SE)
  3. Luzon Development Bank (87.30% of SE)
  4. Equicom Savings Bank Inc (81.51% of SE)
  5. The Palawan Bank Inc (79.23% of SE)
  6. UCPB Savings Bank (71.42% of SE)
  7. Maritime Savings Bank Corporation (62.59% of SE)
  8. Legazpi Savings Bank (61.38% of SE)
  9. Philippine Veterans Bank (59.36% of SE)
  10. Philippine Resources Savings Banking Corporation (43.95% of SE)
  11. China Bank Savings Inc (43.14% of SE)
  12. Sterling Bank of Asia Inc (41.73% of SE)
  13. Standard Chartered Bank (40.58% of SE)
  14. Northpoint Development Bank Inc (38.09% of SE)
  15. RCBC Savings Bank Inc (37.63% of SE)
  16. University Savings Bank Inc (34.74% of SE)
  17. Pampanga Development Bank (34.30% of SE)
  18. Penbank Inc (32.45% of SE)
  19. Malayan Bank Savings and Mortgage Bank Inc (32.18% of SE)
  20. Bataan Development Bank (32.06% of SE)
  21. 1st Valley Bank Inc (31.52% of SE)
  22. Malasiqui Progressive SLB Inc (30.84% of SE)



Source: www.bsp.gov.ph



Sunday, May 13, 2018

An 80% Minimum NPL Coverage Ratio will Result in a Severe Undercapitalization of Some Philippine Banks - December 31, 2017

In a previous blog post called "Are Philippine Banks Under Provisioning Loan Losses? - As of December 31, 2017", we discussed the current aggregate Loan Loss Reserves (LLR) as a percentage of Total Loan Portfolio (TLP), which stood at 1.85% as of December 31, 2017, is below the historic average of 4.08% for the last thirty-four years.
 
Despite NPLs being at or near historic lows, some banks still have not adequately provisioned for loan losses. Their NPL Coverage Ratios are below the ideal ratio of 100% and even below the suggested minimum of 80% NPL Coverage Ratio.

As the table below suggests, it seems that around 34 banks (highlighted in yellow, failed banks in red) fall into this deficiency.


 
Philippine Banking System
NPL Coverage Ratio
December 31, 2017








Bank Loan Loss Provisions Gross NPLs NPL Coverage Ratio
PHIL POSTAL SAVINGS BANK INC 359,696,636.96 2,573,636,133.05 13.98%
MARITIME SAVINGS BANK CORPORATION 6,948,645.24 23,615,730.12 29.42%
UNIVERSITY SAVINGS BANK INC 43,742,434.66 143,068,589.00 30.57%
LUZON DEVELOPMENT BANK 179,930,113.15 572,886,788.42 31.41%
UCPB SAVINGS BANK 602,040,666.86 1,805,224,708.69 33.35%
PHILIPPINE RESOURCES SAVINGS BANKING CORPORATION (PR SAVINGS 367,095,651.13 1,041,502,843.18 35.25%
EQUICOM SAVINGS BANK INC 221,392,363.03 581,351,331.19 38.08%
ALLBANK (A THRIFT BANK) INC 25,226,813.08 63,415,045.83 39.78%
1ST VALLEY BANK INC A DEVELOPMENT BANK 210,213,805.41 524,483,848.57 40.08%
CITYSTATE SAVINGS BANK INC 79,217,291.59 193,352,128.38 40.97%
PNB SAVINGS BANK 698,460,623.34 1,668,304,338.01 41.87%
WEALTH DEVELOPMENT BANK CORPORATION 155,713,418.44 355,586,153.21 43.79%
CITY SAVINGS BANK INC 1,133,146,672.30 2,547,279,274.47 44.48%
MALASIQUI PROGRESSIVE SLB, INC 6,951,706.48 15,625,906.59 44.49%
DUMAGUETE CITY DEV BANK INC 19,299,237.59 37,947,396.83 50.86%
RCBC SAVINGS BANK INC 2,401,025,106.49 4,434,141,000.56 54.15%
AL-AMANAH ISLAMIC INVESTMENT BANK OF THE PHILS 2,586,990.79 4,726,959.53 54.73%
CENTURY SAVINGS BANK CORPORATION 19,702,529.95 35,875,505.12 54.92%
CHINA BANK SAVINGS INC 2,161,442,962.97 3,926,539,784.17 55.05%
QUEZON COCONUT BANK INC (A THRIFT BANK) 1,452,319.51 2,606,502.67 55.72%
STERLING BANK OF ASIA INC (A SAVINGS BANK) 640,893,087.58 1,109,957,042.55 57.74%
PAMPANGA DEVELOPMENT BANK 30,518,706.22 51,370,076.92 59.41%
ENTERPRISE BANK INC (A THRIFT BANK) 148,926,171.26 236,780,337.30 62.90%
LEMERY SAVINGS & LOAN BANK, INC. 2,874,586.45 4,270,287.78 67.32%
SUN SAVINGS BANK INC 18,650,416.70 27,575,519.66 67.63%
PHIL STAR DEVELOPMENT BANK INC 9,276,107.75 13,618,385.28 68.11%
NORTHPOINT DEV'T BANK INC 94,058,155.26 135,617,693.05 69.36%
EAST WEST BANKING CORP 6,689,334,583.44 9,194,973,447.66 72.75%
PRODUCERS SAVINGS BANK CORPORATION 173,496,960.47 235,827,682.71 73.57%
HIYAS BANKING CORPORATION 28,859,545.81 39,024,897.61 73.95%
LIFE SAVINGS BANK INC 5,424,695.67 7,323,871.50 74.07%
PENBANK INC (A PDB) (FORMERLY: PENINSULA RB INC) 119,347,708.00 159,948,202.14 74.62%
STANDARD CHARTERED BANK 1,962,488,076.95 2,621,936,475.60 74.85%
UNITED COCONUT PLANTERS BANK 3,365,124,955.37 4,260,495,688.39 78.98%
LEGAZPI SAVINGS BANK INC 267,732,567.57 331,930,878.48 80.66%
BANK OF MAKATI (A SAVINGS BANK) INC 1,717,623,068.94 2,112,966,067.15 81.29%
PHILIPPINE VETERANS BANK 1,664,354,679.22 1,940,400,491.73 85.77%
BATAAN DEVELOPMENT BANK 23,381,061.33 27,105,889.48 86.26%
MAYBANK PHILIPPINES INCORPORATED 1,326,734,966.07 1,505,097,676.36 88.15%
BANK ONE SAVINGS AND TRUST CORP. 44,384,460.48 49,944,276.09 88.87%
BPI FAMILY SAVINGS BANK INC 6,834,672,387.15 7,510,125,483.03 91.01%
PHIL SAVINGS BANK 4,482,397,136.59 4,770,532,359.83 93.96%
BPI DIRECT BANKO INC A SAVINGS BANK 435,832,557.59 445,658,466.00 97.80%
PHIL BANK OF COMMUNICATIONS 2,164,414,667.52 2,188,900,338.08 98.88%
PHILIPPINE BUSINESS BANK INC A SAVINGS BANK 1,494,847,756.55 1,508,538,115.21 99.09%
YUANTA SAVINGS BANK PHILIPPINES INC 111,659,778.72 111,281,975.24 100.34%
MAXIMUM SAVINGS BANK INC 9,369,812.16 9,301,471.34 100.73%
UNION BANK OF THE PHILS 8,682,456,359.60 7,919,233,625.67 109.64%
THE PALAWAN BANK (PALAWAN DB) INC 22,860,428.44 20,627,309.35 110.83%
MALAYAN BANK SAVINGS AND MORT BANK INC 428,096,630.02 382,510,294.71 111.92%
ROBINSONS BANK CORPORATION 870,113,574.23 764,981,621.23 113.74%
CORDILLERA SAVINGS BANK INC 15,015,675.60 13,111,997.34 114.52%
DEVELOPMENT BANK OF THE PHIL 7,014,994,004.78 5,910,318,428.03 118.69%
QUEEN CITY DEVELOPMENT BANK INC OR QUEENBANK A THRIFT BANK 25,709,790.77 21,531,439.74 119.41%
BANK OF COMMERCE 2,316,834,127.38 1,905,183,563.38 121.61%
PACIFIC ACE SAVINGS BANK INC 934,156.70 723,612.00 129.10%
PHIL NATIONAL BANK 11,787,259,241.98 9,026,087,102.44 130.59%
BUSINESS AND CONSUMERS BANK (A DB) 10,841,871.97 8,282,870.65 130.90%
RIZAL COMM'L BANKING CORP 3,881,667,615.24 2,850,646,633.56 136.17%
MERCHANTS SAVINGS & LOAN ASSN INC 33,386,029.89 24,490,163.18 136.32%
HONGKONG & SHANGHAI BANKING CORP 992,793,880.01 716,358,593.37 138.59%
FARMERS SAVINGS & LOAN BANK INC 26,735,177.92 18,781,070.83 142.35%
BANGKO KABAYAN INC (A PRIVATE DEVELOPMENT BANK) 25,477,556.67 17,218,615.00 147.97%
BDO UNIBANK INC 27,437,933,434.38 17,044,080,200.52 160.98%
INTER-ASIA DEVELOPMENT BANK 6,129,628.98 3,697,216.26 165.79%
HSBC SAVINGS BANK(PHILS) INC 97,081,299.13 58,497,575.68 165.96%
ASIA UNITED BANK CORPORATION 2,293,370,091.42 1,305,313,160.92 175.70%
CARD SME BANK INC A THRIFT BANK 134,937,870.63 76,379,195.49 176.67%
FIRST CONSOLIDATED BANK INC (A PDB) 696,030,195.87 386,608,203.74 180.04%
CHINA BANKING CORP 5,352,681,373.43 2,923,249,111.15 183.11%
LAND BANK OF THE PHILIPPINES 12,251,113,846.21 6,599,423,137.92 185.64%
CTBC BANK (PHILIPPINES) CORP 777,243,866.09 402,002,888.64 193.34%
METRO CEBU PUBLIC SAVINGS BANK 18,946,249.25 9,340,189.11 202.85%
BANK OF THE PHIL ISLANDS 16,422,283,140.14 8,072,907,030.81 203.42%
PHIL TRUST COMPANY 2,656,813,115.59 1,235,274,115.70 215.08%
METROPOLITAN BANK & TCO 13,765,323,944.43 6,019,807,187.46 228.67%
KEB HANA BANK - MANILA BRANCH 69,552,515.74 28,043,200.72 248.02%
SECURITY BANK CORP 5,765,769,749.50 2,126,420,967.47 271.15%
CITIBANK, N.A. 3,971,762,663.78 932,256,279.91 426.04%
BANGKOK BANK PUBLIC CO LTD 404,989,125.00 32,996,077.60 1227.39%
ING BANK N.V. 82,936,914.52 101.86 81422456.82%
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 204,191,133.53 0.00 NA
BANK OF AMERICA N.A. 27,699,996.00 0.00 NA
BANK OF CHINA LIMITED-MANILA BRANCH 148,112,078.19 0.00 NA
BDO PRIVATE BANK, INC. 70,856,519.11 0.00 NA
CATHAY UNITED BANK CO LTD - MANILA BRANCH 11,654,922.18 0.00 NA
DEUTSCHE BANK AG 160,109,262.10 0.00 NA
FIRST COMMERCIAL BANK LTD MANILA BRANCH 2,408,000.00 0.00 NA
HUA NAN COMMERCIAL BANK LTD MANILA BRANCH 0.00 0.00 NA
INDUSTRIAL BANK OF KOREA MANILA BRANCH 16,060,933.90 0.00 NA
ISLA BANK(A THRIFT BANK) INC 4,290,580.33 0.00 NA
JP MORGAN CHASE BANK NATIONAL ASSN. 16,000,000.00 0.00 NA
MEGA INT'L COMM'L BANK CO LTD 133,623,837.77 0.00 NA
MIZUHO BANK LTD - MANILA BRANCH 539,993,128.41 0.00 NA
SHINHAN BANK - MANILA BRANCH 12,198,049.85 0.00 NA
SUMITOMO MITSUI BANKING CORPORATION-MANILA BRANCH 117,581,371.08 0.00 NA
THE BNK OF TOKYO-MITSUBISHI UFJ LTD 388,210,030.46 0.00 NA
UNITED OVERSEAS BANK LIMITED MANILA BRANCH 13,625,282.10 0.00 NA
Grand Total 172,768,654,916.09 138,018,055,845.20 125.18%




Raising the NPL Coverage Ratio to a minimum of 80% will entail additional loan loss provisions for some banks that could eat into a substantial chunk (20% or more) of their Stockholder's Equity.  Based on the table below, five banks will be severely affected:

 
Philippine Banking System
Impact on SE of Minimum Loan Loss Provisions
December 31, 2017










Bank Gross NPLs Minimum Loan Loss Provisions at 80% NPL Coverage Ratio Stockholder's Equity Impact on SE
PHIL POSTAL SAVINGS BANK INC 2,573,636,133.05 2,058,908,906.44 842,001,759.20 -201.81%
LUZON DEVELOPMENT BANK 572,886,788.42 458,309,430.74 656,264,864.47 -42.42%
EQUICOM SAVINGS BANK INC 581,351,331.19 465,081,064.95 713,200,459.81 -34.17%
UCPB SAVINGS BANK 1,805,224,708.69 1,444,179,766.95 2,527,615,670.22 -33.32%
MARITIME SAVINGS BANK CORPORATION 23,615,730.12 18,892,584.10 37,729,273.64 -31.66%
PHILIPPINE RESOURCES SAVINGS BANKING CORPORATION (PR SAVINGS 1,041,502,843.18 833,202,274.54 2,369,540,365.73 -19.67%
UNIVERSITY SAVINGS BANK INC 143,068,589.00 114,454,871.20 411,771,626.31 -17.17%
ENTERPRISE BANK INC (A THRIFT BANK) 236,780,337.30 189,424,269.84 253,723,993.77 -15.96%
1ST VALLEY BANK INC A DEVELOPMENT BANK 524,483,848.57 419,587,078.86 1,664,199,472.79 -12.58%
MALASIQUI PROGRESSIVE SLB, INC 15,625,906.59 12,500,725.27 50,662,752.00 -10.95%
CITYSTATE SAVINGS BANK INC 193,352,128.38 154,681,702.70 697,461,737.09 -10.82%
CHINA BANK SAVINGS INC 3,926,539,784.17 3,141,231,827.34 9,101,933,064.11 -10.76%
RCBC SAVINGS BANK INC 4,434,141,000.56 3,547,312,800.45 11,784,171,179.05 -9.73%
STERLING BANK OF ASIA INC (A SAVINGS BANK) 1,109,957,042.55 887,965,634.04 2,659,580,815.51 -9.29%
WEALTH DEVELOPMENT BANK CORPORATION 355,586,153.21 284,468,922.57 1,467,571,253.00 -8.77%
PAMPANGA DEVELOPMENT BANK 51,370,076.92 41,096,061.54 149,769,025.42 -7.06%
CITY SAVINGS BANK INC 2,547,279,274.47 2,037,823,419.58 13,744,848,979.28 -6.58%
PNB SAVINGS BANK 1,668,304,338.01 1,334,643,470.41 11,503,184,041.59 -5.53%
NORTHPOINT DEV'T BANK INC 135,617,693.05 108,494,154.44 356,004,174.33 -4.06%
DUMAGUETE CITY DEV BANK INC 37,947,396.83 30,357,917.46 284,250,949.11 -3.89%
ALLBANK (A THRIFT BANK) INC 63,415,045.83 50,732,036.66 1,020,711,669.47 -2.50%
STANDARD CHARTERED BANK 2,621,936,475.60 2,097,549,180.48 6,461,203,931.41 -2.09%
PENBANK INC (A PDB) (FORMERLY: PENINSULA RB INC) 159,948,202.14 127,958,561.71 492,890,065.48 -1.75%
EAST WEST BANKING CORP 9,194,973,447.66 7,355,978,758.13 38,620,925,589.08 -1.73%
PHIL STAR DEVELOPMENT BANK INC 13,618,385.28 10,894,708.22 96,350,953.22 -1.68%
SUN SAVINGS BANK INC 27,575,519.66 22,060,415.73 232,213,068.73 -1.47%
HIYAS BANKING CORPORATION 39,024,897.61 31,219,918.09 171,657,550.61 -1.38%
QUEZON COCONUT BANK INC (A THRIFT BANK) 2,606,502.67 2,085,202.14 58,963,045.16 -1.07%
CENTURY SAVINGS BANK CORPORATION 35,875,505.12 28,700,404.10 987,110,507.14 -0.91%
PRODUCERS SAVINGS BANK CORPORATION 235,827,682.71 188,662,146.17 1,774,145,221.80 -0.85%
LEMERY SAVINGS & LOAN BANK, INC. 4,270,287.78 3,416,230.22 85,354,098.57 -0.63%
LIFE SAVINGS BANK INC 7,323,871.50 5,859,097.20 70,816,478.86 -0.61%
AL-AMANAH ISLAMIC INVESTMENT BANK OF THE PHILS 4,726,959.53 3,781,567.62 243,855,237.24 -0.49%
UNITED COCONUT PLANTERS BANK 4,260,495,688.39 3,408,396,550.71 17,397,558,815.10 -0.25%
HUA NAN COMMERCIAL BANK LTD MANILA BRANCH 0.00 0.00 2,069,461,976.42 0.00%
FIRST COMMERCIAL BANK LTD MANILA BRANCH 0.00 0.00 2,021,320,878.22 0.12%
BANK OF MAKATI (A SAVINGS BANK) INC 2,112,966,067.15 1,690,372,853.72 7,227,534,095.53 0.38%
LEGAZPI SAVINGS BANK INC 331,930,878.48 265,544,702.78 540,799,646.86 0.40%
PACIFIC ACE SAVINGS BANK INC 723,612.00 578,889.60 74,525,853.83 0.48%
CATHAY UNITED BANK CO LTD - MANILA BRANCH 0.00 0.00 2,121,743,141.73 0.55%
SHINHAN BANK - MANILA BRANCH 0.00 0.00 2,210,389,217.63 0.55%
UNITED OVERSEAS BANK LIMITED MANILA BRANCH 0.00 0.00 2,340,838,059.36 0.58%
ISLA BANK(A THRIFT BANK) INC 0.00 0.00 680,167,573.92 0.63%
INDUSTRIAL BANK OF KOREA MANILA BRANCH 0.00 0.00 2,294,253,435.17 0.70%
BANK ONE SAVINGS AND TRUST CORP. 49,944,276.09 39,955,420.87 590,489,801.54 0.75%
SUMITOMO MITSUI BANKING CORPORATION-MANILA BRANCH 0.00 0.00 12,852,741,885.32 0.91%
MAYBANK PHILIPPINES INCORPORATED 1,505,097,676.36 1,204,078,141.09 12,948,139,648.57 0.95%
JP MORGAN CHASE BANK NATIONAL ASSN. 0.00 0.00 1,340,894,840.65 1.19%
QUEEN CITY DEVELOPMENT BANK INC OR QUEENBANK A THRIFT BANK 21,531,439.74 17,225,151.79 654,541,579.78 1.30%
BANK OF AMERICA N.A. 0.00 0.00 2,096,035,697.20 1.32%
BDO PRIVATE BANK, INC. 0.00 0.00 5,348,567,459.72 1.32%
BATAAN DEVELOPMENT BANK 27,105,889.48 21,684,711.58 84,544,777.01 2.01%
ROBINSONS BANK CORPORATION 764,981,621.23 611,985,296.98 12,112,890,535.89 2.13%
MERCHANTS SAVINGS & LOAN ASSN INC 24,490,163.18 19,592,130.54 613,220,402.50 2.25%
RIZAL COMM'L BANKING CORP 2,850,646,633.56 2,280,517,306.85 66,891,627,479.35 2.39%
YUANTA SAVINGS BANK PHILIPPINES INC 111,281,975.24 89,025,580.19 942,387,007.15 2.40%
BANGKO KABAYAN INC (A PRIVATE DEVELOPMENT BANK) 17,218,615.00 13,774,892.00 486,359,819.88 2.41%
KEB HANA BANK - MANILA BRANCH 28,043,200.72 22,434,560.58 1,675,545,705.46 2.81%
PHILIPPINE BUSINESS BANK INC A SAVINGS BANK 1,508,538,115.21 1,206,830,492.17 10,187,187,378.11 2.83%
HONGKONG & SHANGHAI BANKING CORP 716,358,593.37 573,086,874.70 14,676,887,638.06 2.86%
MAXIMUM SAVINGS BANK INC 9,301,471.34 7,441,177.07 64,034,475.98 3.01%
HSBC SAVINGS BANK(PHILS) INC 58,497,575.68 46,798,060.54 1,655,388,144.52 3.04%
BPI FAMILY SAVINGS BANK INC 7,510,125,483.03 6,008,100,386.42 26,687,511,311.24 3.10%
ING BANK N.V. 101.86 81.49 2,614,800,005.89 3.17%
PHIL SAVINGS BANK 4,770,532,359.83 3,816,425,887.86 20,897,738,257.41 3.19%
CORDILLERA SAVINGS BANK INC 13,111,997.34 10,489,597.87 137,391,858.98 3.29%
PHILIPPINE VETERANS BANK 1,940,400,491.73 1,552,320,393.38 3,268,708,856.38 3.43%
PHIL BANK OF COMMUNICATIONS 2,188,900,338.08 1,751,120,270.46 12,009,314,825.58 3.44%
UNION BANK OF THE PHILS 7,919,233,625.67 6,335,386,900.54 67,773,383,482.01 3.46%
BPI DIRECT BANKO INC A SAVINGS BANK 445,658,466.00 356,526,772.80 2,047,202,631.66 3.87%
CHINA BANKING CORP 2,923,249,111.15 2,338,599,288.92 77,160,827,684.31 3.91%
SECURITY BANK CORP 2,126,420,967.47 1,701,136,773.98 103,433,294,420.92 3.93%
PHIL NATIONAL BANK 9,026,087,102.44 7,220,869,681.95 108,897,226,069.70 4.19%
METROPOLITAN BANK & TCO 6,019,807,187.46 4,815,845,749.97 196,170,793,389.04 4.56%
BDO UNIBANK INC 17,044,080,200.52 13,635,264,160.42 297,368,799,872.86 4.64%
ASIA UNITED BANK CORPORATION 1,305,313,160.92 1,044,250,528.74 26,881,201,566.71 4.65%
INTER-ASIA DEVELOPMENT BANK 3,697,216.26 2,957,773.01 66,225,979.07 4.79%
BUSINESS AND CONSUMERS BANK (A DB) 8,282,870.65 6,626,296.52 86,584,808.97 4.87%
DEVELOPMENT BANK OF THE PHIL 5,910,318,428.03 4,728,254,742.42 46,947,591,646.19 4.87%
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 0.00 0.00 4,186,671,243.23 4.88%
BANK OF COMMERCE 1,905,183,563.38 1,524,146,850.70 15,746,839,708.73 5.03%
BANK OF THE PHIL ISLANDS 8,072,907,030.81 6,458,325,624.65 176,842,048,187.50 5.63%
BANK OF CHINA LIMITED-MANILA BRANCH 0.00 0.00 2,599,040,906.95 5.70%
CTBC BANK (PHILIPPINES) CORP 402,002,888.64 321,602,310.91 7,033,338,397.85 6.48%
DEUTSCHE BANK AG 0.00 0.00 2,455,572,028.55 6.52%
LAND BANK OF THE PHILIPPINES 6,599,423,137.92 5,279,538,510.34 104,596,154,345.94 6.67%
PHIL TRUST COMPANY 1,235,274,115.70 988,219,292.56 23,979,055,109.03 6.96%
MEGA INT'L COMM'L BANK CO LTD 0.00 0.00 1,916,692,903.11 6.97%
CARD SME BANK INC A THRIFT BANK 76,379,195.49 61,103,356.39 920,636,294.74 8.02%
THE BNK OF TOKYO-MITSUBISHI UFJ LTD 0.00 0.00 4,665,723,811.53 8.32%
FARMERS SAVINGS & LOAN BANK INC 18,781,070.83 15,024,856.66 132,992,180.75 8.81%
FIRST CONSOLIDATED BANK INC (A PDB) 386,608,203.74 309,286,562.99 4,316,778,086.78 8.96%
MIZUHO BANK LTD - MANILA BRANCH 0.00 0.00 5,465,333,964.66 9.88%
MALAYAN BANK SAVINGS AND MORT BANK INC 382,510,294.71 306,008,235.77 1,188,581,878.15 10.27%
BANGKOK BANK PUBLIC CO LTD 32,996,077.60 26,396,862.08 3,173,866,408.07 11.93%
CITIBANK, N.A. 932,256,279.91 745,805,023.93 18,544,182,580.79 17.40%
METRO CEBU PUBLIC SAVINGS BANK 9,340,189.11 7,472,151.29 57,052,632.86 20.11%
THE PALAWAN BANK (PALAWAN DB) INC 20,627,309.35 16,501,847.48 28,282,539.35 22.48%
Grand Total 138,018,055,845.20 110,414,444,676.16 1,666,089,199,719.15 3.74%



Source: www.bsp.gov.ph


Out of the five banks highlighted in yellow, three banks have been regularly listed as one of the "The Top Distressed Philippine Banks as of December 31, 2017".

The most notable of the banks in this list is Philippine Postal Savings Bank Inc. The bank faces a shortfall of 201.81% of its stated stockholder's equity of Php 842.00 million if it were to increase its loan loss provisions to meet a minimum NPL Coverage Ratio of 80%. In short, it's equity would be completely wiped out and then some if the bank were to properly account for its losses.