A Simple Stress Test of Philippine Banks as of December 31, 2018

In an April 9, 2012 article entitled "Stress Test Proves Strength of PH Banks", "Philippine banks are seen to survive a disaster in which the various lenders are forced to write off loans as large as PhP 36 billion without asking shareholders, the central bank, or the national government for bailout money."  This assertion stems from a recent stress test conducted by the Bangko Sentral ng Pilipinas (BSP) on all 55 regular and commercial and expanded license banks.

For Philippine Banks, these NPLs currently comprise PhP 162.69 billion or 8.19% of the PhP 1,986.00 billion in Stockholders Equity (SE) as of December 31, 2018.  So, writing off 50% of the Philippine Banks NPLs would reduce their aggregate stockholder's equity by a little less than 5%.

 

Are NPLs the Right Numbers to Look At?

In a financial crisis, a loan that is current can very well become past due, and a past due loan can become a non-performing loan, and a non-performing loan can become a loan write-off.  The real number to look at are the loans that the banks and BSP already consider doubtful: Classified Loans.

Investopedia.com defines "Classified Loans" as:

"Any bank loan that is in danger of default. Classified loans have unpaid interest and principal outstanding, and it is unclear whether the bank will be able to recoup the loan proceeds from the borrower. Banks usually categorize such loans as adversely classified assets on their books."

The US Federal Deposit Insurance Corporation (FDIC), similar to our very own Philippine Deposit Insurance Corporation (PDIC), defines Classified Loans as:

"Loans classified Loss are considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future."

In Circular #0247 dated May 19, 2000, BSP defines Classified Loans as loans which possess the following characteristics:

1. Loans especially mentioned because they have potential weaknesses that deserve Management's close attention;
2. Substandard Loans are loans which appear to involve a substantial and unreasonable degree of risk to the institution because of unfavorable record or unsatisfactory characteristics;
3. Doubtful Loans are Substandard Loans with the added characteristics that existing facts, conditions, and values make collection or liquidation in full highly improbable and in which substantial loss is probable;
4. Loss loans are loans that are considered uncollectible or worthless and are of such little value that their continuance as bankable assets is not warranted although the loans may have some recovery or salvage value.

The circular mandates that an allowance for probable losses should be set up in accordance with the following schedule:

1. Loans Especially Mentioned: 5%
2. Substandard - Secured: 6% - 25%
3. Substandard - Unsecured: 25%
4. Doubtful: 50%
5. Loss: 100%

As of December 31, 2018, "Classified Loans and Other Risky Assets" of the Philippine Banks amounted to PhP 381.40 billion or more than two times the size of the Philippine Banking System's NPLs of PhP 162.69 billion for the same period.  Consequently, any write-offs of Classified Loans will have more than twice the impact of an NPL write-off.

This level of classified loans should be measured against the bank's "capital cushion" or its ability to absorb losses.  Capital Cushion is normally defined as a bank's "Tangible Common Equity" plus its Loan Loss Reserves.  Tangible Common Equity (TCE) refers to the subset of shareholders' equity that is not preferred equity and not intangible assets.  So it excludes such items as Hybrid equity (like preferred shares) and goodwill.

By this measure, the level of "Classified Loans and other Risky Assets" amounts to Php 381.40 billion or 18.47% of the Php 2.07 trillion in Total Capital Cushion of Philippine Banks as of December 31, 2018.

 

Stress Test Scenarios

Aggregate

So how will a 10%, 20%, 30%, 40%, and even 50% write-off of Classified Loans affect the Total Capital Cushion of the Philippine Banking System?

In the aggregate, if Classified Loans amount to 18.47% of the banking system's Total Capital Cushion, then it follows that a 10% write-off of Classified Loans will reduce the total capital by 1.85% and a 50% write-off of classified loans will reduce the banking system's Total Capital Cushion by 9.23%.

Individual Banks

A 10% write-off of Classified Loans would severely impact (by 25% or more) the Total Capital Cushion of ten banks (severely affected banks highlighted in yellow).


 

Philippine Banking System
Impact of 10% Classified Loan Loss Severities on Total Capital Cushion
December 31, 2018
	Classified Loans	10% Classified Loan Loss Severity	Total Capital Cushion	Impact of 10% Loss on Total Capital Cushion
Bank	(In Php)	(In Php)	(In Php)	(In %)
RB OF JAEN INC	246,394,482.36	24,639,448.24	55,026,484.31	44.78%
RB OF CENTRAL PANGASINAN (BAYAMBANG) INC	793,137,561.39	79,313,756.14	188,203,491.32	42.14%
MOUNT MAKILING RURAL BANK INC	929,230,979.90	92,923,097.99	257,395,922.88	36.10%
COOP BANK OF CAGAYAN	358,700,977.45	35,870,097.75	99,514,955.30	36.04%
INTER-ASIA DEVELOPMENT BANK	302,714,326.10	30,271,432.61	84,127,347.80	35.98%
BENGUET CENTER BANK INC A RB	209,585,730.24	20,958,573.02	64,443,676.95	32.52%
VILLAGE BANK INC (A RURAL BANK)	349,950,000.00	34,995,000.00	111,293,160.57	31.44%
RB OF BROOKE'S POINT (PALAWAN) INC	325,482,339.12	32,548,233.91	107,357,982.79	30.32%
COMMTY RB OF DAPITAN CITY INC	437,658,675.77	43,765,867.58	155,368,754.58	28.17%
RB OF DULAG (LEYTE) INC	303,999,765.87	30,399,976.59	119,127,199.54	25.52%

 A 20% write-off of Classified Loans will severely impact the Total Capital Cushion of twenty-five banks:


 

Philippine Banking System
Impact of 20% Classified Loan Loss Severities on Total Capital Cushion
December 31, 2018
	Classified Loans	20% Classified Loan Loss Severity	Total Capital Cushion	Impact of 20% Loss on Total Capital Cushion
Bank	(In Php)	(In Php)	(In Php)	(In %)
RB OF JAEN INC	246,394,482.36	49,278,896.47	55,026,484.31	89.55%
RB OF CENTRAL PANGASINAN (BAYAMBANG) INC	793,137,561.39	158,627,512.28	188,203,491.32	84.29%
MOUNT MAKILING RURAL BANK INC	929,230,979.90	185,846,195.98	257,395,922.88	72.20%
COOP BANK OF CAGAYAN	358,700,977.45	71,740,195.49	99,514,955.30	72.09%
INTER-ASIA DEVELOPMENT BANK	302,714,326.10	60,542,865.22	84,127,347.80	71.97%
BENGUET CENTER BANK INC A RB	209,585,730.24	41,917,146.05	64,443,676.95	65.04%
VILLAGE BANK INC (A RURAL BANK)	349,950,000.00	69,990,000.00	111,293,160.57	62.89%
RB OF BROOKE'S POINT (PALAWAN) INC	325,482,339.12	65,096,467.82	107,357,982.79	60.63%
COMMTY RB OF DAPITAN CITY INC	437,658,675.77	87,531,735.15	155,368,754.58	56.34%
RB OF DULAG (LEYTE) INC	303,999,765.87	60,799,953.17	119,127,199.54	51.04%
RB OF GENERAL TRIAS INC	311,191,727.21	62,238,345.44	139,601,022.01	44.58%
RB OF CARDONA (RIZAL) INC	283,959,723.77	56,791,944.75	127,773,780.93	44.45%
RB OF MIDSAYAP INC	216,832,979.07	43,366,595.81	101,399,394.38	42.77%
RB OF SAN MATEO(ISABELA) INC	276,898,398.13	55,379,679.63	139,423,947.36	39.72%
TANAY RB INC	788,041,896.44	157,608,379.29	400,615,426.38	39.34%
RANG-AY BANK INC (A RURAL BANK)	934,214,954.43	186,842,990.89	502,320,301.75	37.20%
BANGKO CARRASCAL INC (A RB)	182,491,150.73	36,498,230.15	101,910,644.87	35.81%
YUANTA SAVINGS BANK PHILIPPINES INC	1,820,245,950.34	364,049,190.07	1,040,818,229.19	34.98%
PLANBANK "RB OF CANLUBANG PLANTERS INC"	254,610,233.05	50,922,046.61	162,960,919.55	31.25%
AMA RURAL BANK OF MANDALUYONG INC	1,355,753,000.00	271,150,600.00	920,331,389.05	29.46%
RB OF SAN LUIS (PAMPANGA) INC	155,139,615.02	31,027,923.00	105,768,654.22	29.34%
RB OF PILAR (BATAAN) INC	228,982,485.96	45,796,497.19	157,229,628.57	29.13%
SUGBUANON RB INC	129,091,660.58	25,818,332.12	90,126,142.18	28.65%
BANK OF CHINA LIMITED-MANILA BRANCH	13,543,768,834.39	2,708,753,766.88	10,098,228,294.69	26.82%
RCBC SAVINGS BANK INC	18,656,485,896.14	3,731,297,179.23	14,678,062,148.52	25.42%

A 30% write-off of Classified Loans will totally wipe out the Total Capital Cushion of five bank (highlighted in red) and severely affect (reduce by 25% or more) the Total Capital Cushion of thirty-four other banks:

 

Philippine Banking System
Impact of 30% Classified Loan Loss Severities on Total Capital Cushion
December 31, 2018
	Classified Loans	30% Classified Loan Loss Severity	Total Capital Cushion	Impact of 30% Loss on Total Capital Cushion
Bank	(In Php)	(In Php)	(In Php)	(In %)
RB OF JAEN INC	246,394,482.36	73,918,344.71	55,026,484.31	134.33%
RB OF CENTRAL PANGASINAN (BAYAMBANG) INC	793,137,561.39	237,941,268.42	188,203,491.32	126.43%
MOUNT MAKILING RURAL BANK INC	929,230,979.90	278,769,293.97	257,395,922.88	108.30%
COOP BANK OF CAGAYAN	358,700,977.45	107,610,293.24	99,514,955.30	108.13%
INTER-ASIA DEVELOPMENT BANK	302,714,326.10	90,814,297.83	84,127,347.80	107.95%
BENGUET CENTER BANK INC A RB	209,585,730.24	62,875,719.07	64,443,676.95	97.57%
VILLAGE BANK INC (A RURAL BANK)	349,950,000.00	104,985,000.00	111,293,160.57	94.33%
RB OF BROOKE'S POINT (PALAWAN) INC	325,482,339.12	97,644,701.74	107,357,982.79	90.95%
COMMTY RB OF DAPITAN CITY INC	437,658,675.77	131,297,602.73	155,368,754.58	84.51%
RB OF DULAG (LEYTE) INC	303,999,765.87	91,199,929.76	119,127,199.54	76.56%
RB OF GENERAL TRIAS INC	311,191,727.21	93,357,518.16	139,601,022.01	66.87%
RB OF CARDONA (RIZAL) INC	283,959,723.77	85,187,917.13	127,773,780.93	66.67%
RB OF MIDSAYAP INC	216,832,979.07	65,049,893.72	101,399,394.38	64.15%
RB OF SAN MATEO(ISABELA) INC	276,898,398.13	83,069,519.44	139,423,947.36	59.58%
TANAY RB INC	788,041,896.44	236,412,568.93	400,615,426.38	59.01%
RANG-AY BANK INC (A RURAL BANK)	934,214,954.43	280,264,486.33	502,320,301.75	55.79%
BANGKO CARRASCAL INC (A RB)	182,491,150.73	54,747,345.22	101,910,644.87	53.72%
YUANTA SAVINGS BANK PHILIPPINES INC	1,820,245,950.34	546,073,785.10	1,040,818,229.19	52.47%
PLANBANK "RB OF CANLUBANG PLANTERS INC"	254,610,233.05	76,383,069.92	162,960,919.55	46.87%
AMA RURAL BANK OF MANDALUYONG INC	1,355,753,000.00	406,725,900.00	920,331,389.05	44.19%
RB OF SAN LUIS (PAMPANGA) INC	155,139,615.02	46,541,884.51	105,768,654.22	44.00%
RB OF PILAR (BATAAN) INC	228,982,485.96	68,694,745.79	157,229,628.57	43.69%
SUGBUANON RB INC	129,091,660.58	38,727,498.17	90,126,142.18	42.97%
BANK OF CHINA LIMITED-MANILA BRANCH	13,543,768,834.39	4,063,130,650.32	10,098,228,294.69	40.24%
RCBC SAVINGS BANK INC	18,656,485,896.14	5,596,945,768.84	14,678,062,148.52	38.13%
COUNTRY BUILDERS BANK INC (A RURAL BANK)	405,457,484.79	121,637,245.44	338,918,879.61	35.89%
RB OF BAMBANG (NUEVA VIZCAYA) INC	160,021,598.24	48,006,479.47	135,878,071.36	35.33%
VALIANT BANK INC (A RURAL BANK)	394,086,459.39	118,225,937.82	348,146,993.95	33.96%
RB OF MARIA AURORA (AURORA) INC	255,085,710.72	76,525,713.22	238,887,658.99	32.03%
COMMON WEALTH RURAL BANK INC	128,522,354.24	38,556,706.27	122,726,745.62	31.42%
GATEWAY RURAL BANK INC	117,659,683.84	35,297,905.15	116,456,818.28	30.31%
RB OF BAYOMBONG INC	171,589,296.52	51,476,788.96	171,028,940.19	30.10%
BOF INC (A RURAL BANK)	573,485,000.67	172,045,500.20	588,331,845.48	29.24%
BATAAN DEVELOPMENT BANK	102,400,000.00	30,720,000.00	107,694,385.91	28.53%
LIBERTY BANK (A RURAL BANK) INC	56,549,762.16	16,964,928.65	59,718,356.52	28.41%
LUZON DEVELOPMENT BANK	317,524,613.70	95,257,384.11	341,642,199.93	27.88%
RB OF MAGDALENA (LAGUNA) INC	115,420,611.10	34,626,183.33	127,950,875.48	27.06%
EQUICOM SAVINGS BANK INC	837,429,756.35	251,228,926.91	930,196,073.97	27.01%
UCPB SAVINGS BANK	2,911,217,229.07	873,365,168.72	3,377,681,971.50	25.86%

 A 40% write-off of Classified Loans will totally wipe out the Total Capital Cushion of ten banks and severely affect (reduce by 25% or more) the Total Capital Cushion of forty more banks:

 

Philippine Banking System
Impact of 40% Classified Loan Loss Severities on Total Capital Cushion
December 31, 2018
	Classified Loans	40% Classified Loan Loss Severity	Total Capital Cushion	Impact of 40% Loss on Total Capital Cushion
Bank	(In Php)	(In Php)	(In Php)	(In %)
RB OF JAEN INC	246,394,482.36	98,557,792.94	55,026,484.31	179.11%
RB OF CENTRAL PANGASINAN (BAYAMBANG) INC	793,137,561.39	317,255,024.56	188,203,491.32	168.57%
MOUNT MAKILING RURAL BANK INC	929,230,979.90	371,692,391.96	257,395,922.88	144.40%
COOP BANK OF CAGAYAN	358,700,977.45	143,480,390.98	99,514,955.30	144.18%
INTER-ASIA DEVELOPMENT BANK	302,714,326.10	121,085,730.44	84,127,347.80	143.93%
BENGUET CENTER BANK INC A RB	209,585,730.24	83,834,292.10	64,443,676.95	130.09%
VILLAGE BANK INC (A RURAL BANK)	349,950,000.00	139,980,000.00	111,293,160.57	125.78%
RB OF BROOKE'S POINT (PALAWAN) INC	325,482,339.12	130,192,935.65	107,357,982.79	121.27%
COMMTY RB OF DAPITAN CITY INC	437,658,675.77	175,063,470.31	155,368,754.58	112.68%
RB OF DULAG (LEYTE) INC	303,999,765.87	121,599,906.35	119,127,199.54	102.08%
RB OF GENERAL TRIAS INC	311,191,727.21	124,476,690.88	139,601,022.01	89.17%
RB OF CARDONA (RIZAL) INC	283,959,723.77	113,583,889.51	127,773,780.93	88.89%
RB OF MIDSAYAP INC	216,832,979.07	86,733,191.63	101,399,394.38	85.54%
RB OF SAN MATEO(ISABELA) INC	276,898,398.13	110,759,359.25	139,423,947.36	79.44%
TANAY RB INC	788,041,896.44	315,216,758.58	400,615,426.38	78.68%
RANG-AY BANK INC (A RURAL BANK)	934,214,954.43	373,685,981.77	502,320,301.75	74.39%
BANGKO CARRASCAL INC (A RB)	182,491,150.73	72,996,460.29	101,910,644.87	71.63%
YUANTA SAVINGS BANK PHILIPPINES INC	1,820,245,950.34	728,098,380.14	1,040,818,229.19	69.95%
PLANBANK "RB OF CANLUBANG PLANTERS INC"	254,610,233.05	101,844,093.22	162,960,919.55	62.50%
AMA RURAL BANK OF MANDALUYONG INC	1,355,753,000.00	542,301,200.00	920,331,389.05	58.92%
RB OF SAN LUIS (PAMPANGA) INC	155,139,615.02	62,055,846.01	105,768,654.22	58.67%
RB OF PILAR (BATAAN) INC	228,982,485.96	91,592,994.38	157,229,628.57	58.25%
SUGBUANON RB INC	129,091,660.58	51,636,664.23	90,126,142.18	57.29%
BANK OF CHINA LIMITED-MANILA BRANCH	13,543,768,834.39	5,417,507,533.76	10,098,228,294.69	53.65%
RCBC SAVINGS BANK INC	18,656,485,896.14	7,462,594,358.46	14,678,062,148.52	50.84%
COUNTRY BUILDERS BANK INC (A RURAL BANK)	405,457,484.79	162,182,993.92	338,918,879.61	47.85%
RB OF BAMBANG (NUEVA VIZCAYA) INC	160,021,598.24	64,008,639.30	135,878,071.36	47.11%
VALIANT BANK INC (A RURAL BANK)	394,086,459.39	157,634,583.76	348,146,993.95	45.28%
RB OF MARIA AURORA (AURORA) INC	255,085,710.72	102,034,284.29	238,887,658.99	42.71%
COMMON WEALTH RURAL BANK INC	128,522,354.24	51,408,941.70	122,726,745.62	41.89%
GATEWAY RURAL BANK INC	117,659,683.84	47,063,873.54	116,456,818.28	40.41%
RB OF BAYOMBONG INC	171,589,296.52	68,635,718.61	171,028,940.19	40.13%
BOF INC (A RURAL BANK)	573,485,000.67	229,394,000.27	588,331,845.48	38.99%
BATAAN DEVELOPMENT BANK	102,400,000.00	40,960,000.00	107,694,385.91	38.03%
LIBERTY BANK (A RURAL BANK) INC	56,549,762.16	22,619,904.86	59,718,356.52	37.88%
LUZON DEVELOPMENT BANK	317,524,613.70	127,009,845.48	341,642,199.93	37.18%
RB OF MAGDALENA (LAGUNA) INC	115,420,611.10	46,168,244.44	127,950,875.48	36.08%
EQUICOM SAVINGS BANK INC	837,429,756.35	334,971,902.54	930,196,073.97	36.01%
UCPB SAVINGS BANK	2,911,217,229.07	1,164,486,891.63	3,377,681,971.50	34.48%
ILOCOS CONSOLIDATED COOPERATIVE BANK	235,585,415.08	94,234,166.03	273,668,154.63	34.43%
BANGKO MABUHAY (A RURAL BANK) INC	259,032,272.36	103,612,908.94	316,424,796.95	32.74%
RB OF MIAGAO (ILOILO) INC	88,287,599.93	35,315,039.97	108,272,092.04	32.62%
SAVIOUR RURAL BANK INC	79,093,088.02	31,637,235.21	98,057,212.25	32.26%
PHIL BANK OF COMMUNICATIONS	9,760,026,451.75	3,904,010,580.70	12,431,457,217.45	31.40%
RBG IMPERIAL BANK INC(A RURAL BANK)	66,866,252.63	26,746,501.05	91,737,680.75	29.16%
CHINA BANK SAVINGS INC	8,081,631,963.44	3,232,652,785.38	11,383,073,287.39	28.40%
GM BANK OF LUZON INC (A RURAL BANK)	338,161,621.17	135,264,648.47	481,843,313.51	28.07%
LEGAZPI SAVINGS BANK INC	543,831,000.00	217,532,400.00	805,601,845.61	27.00%
PBCOM RURAL BANK INC	599,171,649.94	239,668,659.98	893,664,221.36	26.82%
DUMAGUETE CITY DEV BANK INC	207,392,144.61	82,956,857.84	317,685,816.79	26.11%

A 50% write-off of Classified Loans will totally wipe out the Total Capital Cushion of thirteen banks and severely affect (reduce by 25% or more) the Total Capital Cushion of fifty more banks:


 

Philippine Banking System
Impact of 50% Classified Loan Loss Severities on Total Capital Cushion
December 31, 2018
	Classified Loans	50% Classified Loan Loss Severity	Total Capital Cushion	Impact of 50% Loss on Total Capital Cushion
Bank	(In Php)	(In Php)	(In Php)	(In %)
RB OF JAEN INC	246,394,482.36	123,197,241.18	55,026,484.31	223.89%
RB OF CENTRAL PANGASINAN (BAYAMBANG) INC	793,137,561.39	396,568,780.70	188,203,491.32	210.71%
MOUNT MAKILING RURAL BANK INC	929,230,979.90	464,615,489.95	257,395,922.88	180.51%
COOP BANK OF CAGAYAN	358,700,977.45	179,350,488.73	99,514,955.30	180.22%
INTER-ASIA DEVELOPMENT BANK	302,714,326.10	151,357,163.05	84,127,347.80	179.91%
BENGUET CENTER BANK INC A RB	209,585,730.24	104,792,865.12	64,443,676.95	162.61%
VILLAGE BANK INC (A RURAL BANK)	349,950,000.00	174,975,000.00	111,293,160.57	157.22%
RB OF BROOKE'S POINT (PALAWAN) INC	325,482,339.12	162,741,169.56	107,357,982.79	151.59%
COMMTY RB OF DAPITAN CITY INC	437,658,675.77	218,829,337.89	155,368,754.58	140.85%
RB OF DULAG (LEYTE) INC	303,999,765.87	151,999,882.94	119,127,199.54	127.59%
RB OF GENERAL TRIAS INC	311,191,727.21	155,595,863.61	139,601,022.01	111.46%
RB OF CARDONA (RIZAL) INC	283,959,723.77	141,979,861.89	127,773,780.93	111.12%
RB OF MIDSAYAP INC	216,832,979.07	108,416,489.54	101,399,394.38	106.92%
RB OF SAN MATEO(ISABELA) INC	276,898,398.13	138,449,199.07	139,423,947.36	99.30%
TANAY RB INC	788,041,896.44	394,020,948.22	400,615,426.38	98.35%
RANG-AY BANK INC (A RURAL BANK)	934,214,954.43	467,107,477.22	502,320,301.75	92.99%
BANGKO CARRASCAL INC (A RB)	182,491,150.73	91,245,575.37	101,910,644.87	89.53%
YUANTA SAVINGS BANK PHILIPPINES INC	1,820,245,950.34	910,122,975.17	1,040,818,229.19	87.44%
PLANBANK "RB OF CANLUBANG PLANTERS INC"	254,610,233.05	127,305,116.53	162,960,919.55	78.12%
AMA RURAL BANK OF MANDALUYONG INC	1,355,753,000.00	677,876,500.00	920,331,389.05	73.66%
RB OF SAN LUIS (PAMPANGA) INC	155,139,615.02	77,569,807.51	105,768,654.22	73.34%
RB OF PILAR (BATAAN) INC	228,982,485.96	114,491,242.98	157,229,628.57	72.82%
SUGBUANON RB INC	129,091,660.58	64,545,830.29	90,126,142.18	71.62%
BANK OF CHINA LIMITED-MANILA BRANCH	13,543,768,834.39	6,771,884,417.20	10,098,228,294.69	67.06%
RCBC SAVINGS BANK INC	18,656,485,896.14	9,328,242,948.07	14,678,062,148.52	63.55%
COUNTRY BUILDERS BANK INC (A RURAL BANK)	405,457,484.79	202,728,742.40	338,918,879.61	59.82%
RB OF BAMBANG (NUEVA VIZCAYA) INC	160,021,598.24	80,010,799.12	135,878,071.36	58.88%
VALIANT BANK INC (A RURAL BANK)	394,086,459.39	197,043,229.70	348,146,993.95	56.60%
RB OF MARIA AURORA (AURORA) INC	255,085,710.72	127,542,855.36	238,887,658.99	53.39%
COMMON WEALTH RURAL BANK INC	128,522,354.24	64,261,177.12	122,726,745.62	52.36%
GATEWAY RURAL BANK INC	117,659,683.84	58,829,841.92	116,456,818.28	50.52%
RB OF BAYOMBONG INC	171,589,296.52	85,794,648.26	171,028,940.19	50.16%
BOF INC (A RURAL BANK)	573,485,000.67	286,742,500.34	588,331,845.48	48.74%
BATAAN DEVELOPMENT BANK	102,400,000.00	51,200,000.00	107,694,385.91	47.54%
LIBERTY BANK (A RURAL BANK) INC	56,549,762.16	28,274,881.08	59,718,356.52	47.35%
LUZON DEVELOPMENT BANK	317,524,613.70	158,762,306.85	341,642,199.93	46.47%
RB OF MAGDALENA (LAGUNA) INC	115,420,611.10	57,710,305.55	127,950,875.48	45.10%
EQUICOM SAVINGS BANK INC	837,429,756.35	418,714,878.18	930,196,073.97	45.01%
UCPB SAVINGS BANK	2,911,217,229.07	1,455,608,614.54	3,377,681,971.50	43.09%
ILOCOS CONSOLIDATED COOPERATIVE BANK	235,585,415.08	117,792,707.54	273,668,154.63	43.04%
BANGKO MABUHAY (A RURAL BANK) INC	259,032,272.36	129,516,136.18	316,424,796.95	40.93%
RB OF MIAGAO (ILOILO) INC	88,287,599.93	44,143,799.97	108,272,092.04	40.77%
SAVIOUR RURAL BANK INC	79,093,088.02	39,546,544.01	98,057,212.25	40.33%
PHIL BANK OF COMMUNICATIONS	9,760,026,451.75	4,880,013,225.88	12,431,457,217.45	39.26%
RBG IMPERIAL BANK INC(A RURAL BANK)	66,866,252.63	33,433,126.32	91,737,680.75	36.44%
CHINA BANK SAVINGS INC	8,081,631,963.44	4,040,815,981.72	11,383,073,287.39	35.50%
GM BANK OF LUZON INC (A RURAL BANK)	338,161,621.17	169,080,810.59	481,843,313.51	35.09%
LEGAZPI SAVINGS BANK INC	543,831,000.00	271,915,500.00	805,601,845.61	33.75%
PBCOM RURAL BANK INC	599,171,649.94	299,585,824.97	893,664,221.36	33.52%
DUMAGUETE CITY DEV BANK INC	207,392,144.61	103,696,072.31	317,685,816.79	32.64%
PHIL SAVINGS BANK	15,735,910,002.93	7,867,955,001.47	25,390,633,332.29	30.99%
RB OF ITOGON (BENGUET) INC	77,102,158.58	38,551,079.29	130,328,760.60	29.58%
PHILIPPINE RESOURCES SAVINGS BANKING CORPORATION (PR SAVINGS	1,668,294,120.12	834,147,060.06	2,834,537,674.89	29.43%
PEOPLES BANK OF CARAGA INC (A RURAL BANK)	303,559,083.75	151,779,541.88	528,366,265.99	28.73%
COOPERATIVE BANK OF BOHOL	61,367,388.46	30,683,694.23	108,358,908.36	28.32%
NEW RB OF SAN LEONARDO(N.E.) INC	126,861,561.53	63,430,780.77	224,534,333.51	28.25%
RNG COASTAL BANK INC(A RURAL BANK)	88,341,709.14	44,170,854.57	162,387,138.30	27.20%
PHIL STAR DEVELOPMENT BANK INC	58,376,668.01	29,188,334.01	109,439,031.42	26.67%
HIGHLAND RURAL BANK INC	89,327,377.39	44,663,688.70	169,023,706.21	26.42%
ENTREPRENEUR RB INC	47,999,516.78	23,999,758.39	91,581,927.15	26.21%
PENBANK INC (A PDB) (FORMERLY: PENINSULA RB INC)	321,493,859.11	160,746,929.56	613,905,292.41	26.18%
MARITIME SAVINGS BANK CORPORATION	30,751,711.11	15,375,855.56	60,691,652.15	25.33%
MALARAYAT RB INC	95,492,150.96	47,746,075.48	190,380,415.56	25.08%

Please bear in mind that a number of these banks are already very weak and are in distress.  Please see a previous blog post: "The Top Distressed Philippine Banks as of December 31, 2018" as well as The Top Distressed Philippine Rural and Cooperative Banks as of December 31, 2018.  Moreover, their capital can be overstated.  See a previous blog post "Overstated Capital of Philippine Banks as of December 31, 2018" as well as Overstated Capital of Philippine Rural and Cooperative Banks as of December 31, 2018 .  

As such, any reduction in their capital cushion could knock down an already weak bank.

Source: www.bsp.gov.ph