Based on the individual Published Statements of Condition for the Thrift Banking Industry (from www.bsp.gov.ph), Total Distressed Assets of Philippine Thrift Banks increased by PHP 4.9 billion or 5.08% from March 31, 2011 to June 30, 2011. This was partially offset by an increase of PHP 0.6 billion (or 0.80%) in the Total Capital Cushion of the Thrift Banks during the same period. As a result, the Thrift Bank's Ratio of Distressed Assets to Total Capital Cushion increased by 5.16%, from 121.70% as of March 31, 2011 to 126.87% as of June 30, 2011. Editor's Note: The ratio of Distressed Assets to Total Capital Cushion is a variant of the famous Texas Ratio, which was widely used by US financial regulators to predict bank failure during the US Savings and Loan Crisis in the 1980s and early 1990s. For a more detailed discussion of this ratio, please visit a previous blog post: The Texas Ratio of Select Philippine Banks
Please note that the overall ratio of 126.87% is still way above the borderline level of 100% (highlighted in yellow). This ratio has been skewed upward by the presence of around 24 thrift banks that are above the 100% borderline level which indicates that the bank is at or near insolvency. Although levels have deteriorated, one bank, Philippine Postal Savings Bank declined below the borderline level, from 103.29% as of March 31, 2011 to 94.59% as of June 30, 2011. The top distressed bank as of March 31, 2011, Legaspi Savings Bank (which had a distressed ratio of 2170.01% as of December 31, 2010 and 1730.43% as of March 31, 2011), dropped off the list because it had no published statement of condition as of June 30, 2011. A new entrant to the list of borderline banks was Citibank Saving Inc., whose distressed ratio rose from a just below borderline level of 99.06% as of March 31, 2011 to 110.79% as of June 30, 2011.
The borderline banks (highlighted in yellow), as whole, showed a significant increase in their Total Distressed Assets/Total Capital Cushion Ratios. This ratio now stands at 267.64% as of June 30, 2011, up from 248.66% as of March 31, 2011.
The borderline banks that exhibited a significant increase in this ratio include:
- The Palawan Development Bank (34.67% increase)
- RCBC Savings Bank Inc. (27.14% increase)
- Luzon Development Bank (18.12% increase)
- City Savings Bank (17.22% increase)
- Iloilo City Development Bank (14.65% increase)
- CityState Savings Bank (11.16% increase)
- LBC Development Bank - defunct as of September 2011 (11.12% increase).
The borderline banks that exhibited a significant drop in their Total Distressed Assets/Total Capital Cushion Ratios include the following:
- China Bank Savings (56.24% drop)
- Dumaguete City Development Bank (11.29% drop)
| Philippine Thrift Banking System | ||||
| Total Distressed Assets/Total Capital Cushion | ||||
| March 31, 2011 to June 30, 2011 | ||||
| Bank | March 31, 2011 | June 30, 2011 | Variance | % Variance |
| Progress SLA | 6.70% | 13.24% | 6.54% | 97.62% |
| Tower Development Bank | 57.03% | 77.70% | 20.67% | 36.24% |
| The Palawan Development Bank | 449.30% | 605.09% | 155.79% | 34.67% |
| RCBC Savings Bank Inc. | 140.74% | 178.93% | 38.19% | 27.14% |
| Century Savings Bank | 2.93% | 3.53% | 0.60% | 20.37% |
| Luzon Development Bank | 104.48% | 123.41% | 18.93% | 18.12% |
| City Savings Bank | 520.21% | 609.80% | 89.59% | 17.22% |
| Tong Yang Savings Bank Inc. | 76.31% | 88.58% | 12.27% | 16.08% |
| Iloilo City Development Bank | 294.71% | 337.88% | 43.17% | 14.65% |
| Sampaguita SLA, Inc. | 54.00% | 60.68% | 6.69% | 12.38% |
| Citibank Savings Inc. | 99.06% | 110.79% | 11.73% | 11.84% |
| CityState Savings Bank | 173.56% | 192.92% | 19.37% | 11.16% |
| LBC Development Bank | 703.67% | 781.95% | 78.28% | 11.12% |
| Business & Consumers Bank A DB | 183.31% | 201.32% | 18.01% | 9.83% |
| Cordillera Savings Bank | 72.96% | 79.15% | 6.18% | 8.48% |
| Real Bank (A Thrift Bank) Inc. | 788.74% | 840.20% | 51.46% | 6.52% |
| Planters Development Bank | 322.90% | 343.14% | 20.24% | 6.27% |
| Metro Cebu Public Savings Bank | 87.44% | 92.58% | 5.14% | 5.88% |
| Lemery Savings & Loan Bank, Inc. | 45.40% | 47.66% | 2.26% | 4.98% |
| The Queen City Development Bank | 22.25% | 23.30% | 1.05% | 4.72% |
| World Partners Bank | 38.05% | 39.84% | 1.79% | 4.70% |
| BPI Direct Savings Bank | 15.39% | 16.10% | 0.71% | 4.63% |
| Merchants Savings & Loan Association | 5.14% | 5.36% | 0.22% | 4.25% |
| Premiere Development Bank | 140.05% | 145.40% | 5.34% | 3.82% |
| Philippine Savings Bank | 76.58% | 79.47% | 2.89% | 3.77% |
| Malayan Bank Savings & Mortgage Bank | 108.84% | 112.08% | 3.23% | 2.97% |
| Equicom Savings Bank | 145.38% | 148.76% | 3.38% | 2.32% |
| Bataan SLA | 11.57% | 11.83% | 0.26% | 2.24% |
| Dungganon Bank | 111.01% | 112.68% | 1.67% | 1.50% |
| UCPB Savings Bank | 43.42% | 44.02% | 0.60% | 1.38% |
| University SLA | 151.59% | 153.56% | 1.97% | 1.30% |
| Northpoint Development Bank | 45.72% | 46.25% | 0.54% | 1.18% |
| Village SLA | 813.24% | 820.15% | 6.91% | 0.85% |
| Life Savings Bank | 53.51% | 53.74% | 0.23% | 0.42% |
| Pridestar Development Bank | 60.30% | 60.38% | 0.08% | 0.13% |
| Wealth Bank | 78.00% | 78.05% | 0.06% | 0.07% |
| Opportunity Microfinance Bank | 152.68% | 152.70% | 0.02% | 0.01% |
| BPI Globe Bank Inc. Savings Bank | 8.32% | 8.32% | 0.00% | 0.00% |
| Robinsons Savings Bank | 40.56% | 40.56% | 0.00% | 0.00% |
| BDO Elite Savings Bank | 6.35% | 6.35% | 0.00% | -0.01% |
| Isla bank (A Thrift Bank) Inc. | 8.95% | 8.95% | -0.01% | -0.06% |
| Hiyas Savings & Loan Bank | 167.25% | 165.82% | -1.44% | -0.86% |
| Philippine Business Bank | 66.34% | 65.75% | -0.59% | -0.89% |
| Pampanga Development Bank | 70.33% | 69.37% | -0.96% | -1.36% |
| GSIS Family Bank | 306.51% | 301.33% | -5.18% | -1.69% |
| BPI Family Savings Bank | 79.26% | 77.87% | -1.40% | -1.76% |
| Liberty Savings & Loan | 69.29% | 67.57% | -1.72% | -2.48% |
| Optimum Development Bank | 20.80% | 20.28% | -0.52% | -2.50% |
| EIB Savings Bank Inc. | 8.66% | 8.43% | -0.23% | -2.63% |
| Bataan Development Bank | 233.55% | 224.50% | -9.05% | -3.88% |
| United Overseas Bank Philippines | 70.78% | 67.56% | -3.23% | -4.56% |
| Farmers Savings and Loan Association | 202.55% | 193.30% | -9.26% | -4.57% |
| Microfinance Maximum SB (Maxbank) | 51.30% | 48.74% | -2.56% | -4.98% |
| Sterling Bank of Asia Inc. (A SB) | 44.70% | 41.09% | -3.61% | -8.07% |
| Quezon Coconut Producers SLB | 35.97% | 33.00% | -2.97% | -8.26% |
| Philippine Postal Savings Bank | 103.29% | 94.59% | -8.70% | -8.42% |
| Bank One Savings and Trust Corp. | 12.25% | 11.18% | -1.07% | -8.75% |
| First Consolidated Bank Inc. | 63.11% | 57.48% | -5.62% | -8.91% |
| HSBC Savings Bank (Philippines) Inc. | 13.31% | 11.95% | -1.36% | -10.21% |
| Dumaguete City Development Bank | 140.79% | 124.90% | -15.89% | -11.29% |
| Malasiqui Progressive SLB | 36.31% | 32.09% | -4.22% | -11.63% |
| Producers Savings Bank Corporation | 91.05% | 79.90% | -11.16% | -12.25% |
| Allied Savings Bank | 35.04% | 30.38% | -4.66% | -13.31% |
| Maritime SLA Inc. | 23.43% | 20.17% | -3.27% | -13.94% |
| Pacific Ace Savings Bank | 18.83% | 8.45% | -10.38% | -55.14% |
| China Bank Savings | 392.93% | 171.94% | -220.99% | -56.24% |
| Legaspi Savings Bank | 1730.43% | NA | NA | NA |
| Penbank | NA | 79.56% | NA | NA |
| Total | 121.70% | 126.87% | 5.16% | 4.24% |
On a half-year basis, the thrift banking system has improved its Ratio of Distressed Assets to Total Capital Cushion by 2.58%, from 130.22% as of December 31, 2010 to 126.87% as of June 30, 2011. This is not because Total Distressed Assets have gone down. Total Distressed Assets went up by PHP 7.6 billion or 8.12% from December 31, 2010 to June 30, 2011. It is because Total Capital Cushion went up by PHP 7.9 billion or 10.99% in the same period.
Despite the overall improvement in the Thrift Bank Industry, the borderline banks distressed ratios deteriorated during the first half of 2011. The distressed ratio for these banks have climbed from 248.85% as of December 31, 2010 to 267.64% as of June 30, 2011.
Despite the overall improvement in the Thrift Bank Industry, the borderline banks distressed ratios deteriorated during the first half of 2011. The distressed ratio for these banks have climbed from 248.85% as of December 31, 2010 to 267.64% as of June 30, 2011.
The borderline banks that exhibited significant deterioration in their Total Distressed Assets to Total Capital Cushion Ratios were the following:
- CityState Savings Bank (392.36% increase)
- Premiere Development Bank (75.69% increase)
- LBC Development Bank (defunct as of September 2011) (37.81% increase)
- Citibank Savings Inc. (21.75% increase)
- Iloilo City Development Bank (19.10% increase)
- Luzon Development Bank (18.93% increase)
- Opportunity Microfinance Bank (17.98% increase)
- The Palawan Development Bank (17.75% increase)
- China Bank Savings (54.95% drop)
- City Savings Bank (20.73% drop)
- Farmers Savings and Loan Association (15.46% drop)
Philippine Postal Savings Bank dropped out of the list of borderline banks altogether with a 15.05% drop in its ratio of Total Distressed Assets to Total Capital Cushion.
| Philippine Thrift Banking System | ||||
| Total Distressed Assets/Total Capital Cushion | ||||
| December 31, 2011 to June 30, 2011 | ||||
| Bank | December 31, 2010 | June 30, 2011 | Variance | % Variance |
| CityState Savings Bank | 39.18% | 192.92% | 153.74% | 392.36% |
| Progress SLA | 6.59% | 13.24% | 6.65% | 100.99% |
| Premiere Development Bank | 82.76% | 145.40% | 62.64% | 75.69% |
| BPI Globe Bank Inc. Savings Bank | 5.38% | 8.32% | 2.94% | 54.78% |
| LBC Development Bank | 567.42% | 781.95% | 214.53% | 37.81% |
| Century Savings Bank | 2.81% | 3.53% | 0.72% | 25.74% |
| Citibank Savings Inc. | 91.00% | 110.79% | 19.80% | 21.75% |
| Iloilo City Development Bank | 283.69% | 337.88% | 54.19% | 19.10% |
| Luzon Development Bank | 103.77% | 123.41% | 19.64% | 18.93% |
| Opportunity Microfinance Bank | 129.43% | 152.70% | 23.27% | 17.98% |
| The Palawan Development Bank | 513.90% | 605.09% | 91.19% | 17.75% |
| Sampaguita SLA, Inc. | 54.38% | 60.68% | 6.30% | 11.58% |
| Tong Yang Savings Bank Inc. | 79.85% | 88.58% | 8.74% | 10.94% |
| Cordillera Savings Bank | 72.68% | 79.15% | 6.46% | 8.89% |
| Business & Consumers Bank A DB | 185.14% | 201.32% | 16.18% | 8.74% |
| Malayan Bank Savings & Mortgage Bank | 103.44% | 112.08% | 8.64% | 8.35% |
| Bataan SLA | 10.98% | 11.83% | 0.85% | 7.74% |
| RCBC Savings Bank Inc. | 166.80% | 178.93% | 12.13% | 7.27% |
| Hiyas Savings & Loan Bank | 156.01% | 165.82% | 9.81% | 6.29% |
| Metro Cebu Public Savings Bank | 87.66% | 92.58% | 4.92% | 5.62% |
| GSIS Family Bank | 286.92% | 301.33% | 14.41% | 5.02% |
| Tower Development Bank | 75.62% | 77.70% | 2.08% | 2.76% |
| Northpoint Development Bank | 45.22% | 46.25% | 1.03% | 2.29% |
| UCPB Savings Bank | 43.21% | 44.02% | 0.81% | 1.87% |
| Maritime SLA Inc. | 19.95% | 20.17% | 0.21% | 1.06% |
| Dungganon Bank | 112.33% | 112.68% | 0.35% | 0.32% |
| University SLA | 154.21% | 153.56% | -0.65% | -0.42% |
| Village SLA | 823.93% | 820.15% | -3.78% | -0.46% |
| Planters Development Bank | 344.85% | 343.14% | -1.70% | -0.49% |
| Bataan Development Bank | 226.07% | 224.50% | -1.57% | -0.69% |
| Equicom Savings Bank | 149.92% | 148.76% | -1.17% | -0.78% |
| Isla bank (A Thrift Bank) Inc. | 9.02% | 8.95% | -0.07% | -0.83% |
| United Overseas Bank Philippines | 68.26% | 67.56% | -0.70% | -1.03% |
| Lemery Savings & Loan Bank, Inc. | 48.16% | 47.66% | -0.50% | -1.04% |
| Pridestar Development Bank | 61.47% | 60.38% | -1.09% | -1.77% |
| Microfinance Maximum SB (Maxbank) | 49.89% | 48.74% | -1.15% | -2.30% |
| Wealth Bank | 80.48% | 78.05% | -2.43% | -3.02% |
| Real Bank (A Thrift Bank) Inc. | 868.10% | 840.20% | -27.90% | -3.21% |
| BDO Elite Savings Bank | 6.62% | 6.35% | -0.27% | -4.11% |
| Philippine Savings Bank | 83.15% | 79.47% | -3.68% | -4.43% |
| Optimum Development Bank | 21.28% | 20.28% | -1.00% | -4.71% |
| Pampanga Development Bank | 73.19% | 69.37% | -3.82% | -5.22% |
| Dumaguete City Development Bank | 132.38% | 124.90% | -7.48% | -5.65% |
| EIB Savings Bank Inc. | 9.18% | 8.43% | -0.75% | -8.18% |
| Life Savings Bank | 59.44% | 53.74% | -5.71% | -9.60% |
| Malasiqui Progressive SLB | 36.32% | 32.09% | -4.24% | -11.67% |
| Philippine Postal Savings Bank | 111.34% | 94.59% | -16.75% | -15.05% |
| Merchants Savings & Loan Association | 6.31% | 5.36% | -0.95% | -15.11% |
| Farmers Savings and Loan Association | 228.64% | 193.30% | -35.35% | -15.46% |
| BPI Family Savings Bank | 92.13% | 77.87% | -14.26% | -15.48% |
| Allied Savings Bank | 36.47% | 30.38% | -6.09% | -16.70% |
| Sterling Bank of Asia Inc. (A SB) | 50.13% | 41.09% | -9.04% | -18.03% |
| BPI Direct Savings Bank | 20.02% | 16.10% | -3.92% | -19.59% |
| Robinsons Savings Bank | 50.59% | 40.56% | -10.03% | -19.83% |
| City Savings Bank | 769.30% | 609.80% | -159.50% | -20.73% |
| Producers Savings Bank Corporation | 102.49% | 79.90% | -22.60% | -22.05% |
| Liberty Savings & Loan | 87.06% | 67.57% | -19.48% | -22.38% |
| First Consolidated Bank Inc. | 75.89% | 57.48% | -18.41% | -24.26% |
| Quezon Coconut Producers SLB | 44.00% | 33.00% | -11.00% | -25.01% |
| HSBC Savings Bank (Philippines) Inc. | 16.15% | 11.95% | -4.20% | -26.02% |
| World Partners Bank | 59.37% | 39.84% | -19.53% | -32.90% |
| Philippine Business Bank | 98.94% | 65.75% | -33.19% | -33.55% |
| The Queen City Development Bank | 37.85% | 23.30% | -14.55% | -38.44% |
| Bank One Savings and Trust Corp. | 20.00% | 11.18% | -8.82% | -44.11% |
| China Bank Savings | 381.64% | 171.94% | -209.70% | -54.95% |
| Pacific Ace Savings Bank | 18.87% | 8.45% | -10.42% | -55.24% |
| Legaspi Savings Bank | 2170.01% | NA | NA | NA |
| Penbank | NA | 79.56% | NA | NA |
| Total | 130.22% | 126.87% | -3.36% | -2.58% |
Disclaimer: This list only serves as a screening guide. It is not a definitive guide and must be taken in the context of other factors. The figures are based on the individual banks' statement of condition as of June 30, 2011 as published in the BSP website (www.bsp.gov.ph). For this analysis, no attempt was made to go through the audited financial statements of each bank. Readers are suggested to make their own investigations and verify the figures presented. Both BSP and PDIC have their own problem bank screening systems that are much more sophisticated in scope and design, given that they have more access to information over the banks they regulate. |
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