Philippine Banks Improve in the 4th Qtr. of 2015

Editor's Note: The Philippine Deposit Insurance Corporation (PDIC) advised consumers to wisely choose the banks where they will deposit their money. The trouble is, most depositors don't and can't read financial statements before they open a bank account. The regulators, whose job is to safeguard the public's money, have not done a good job recently.  In the past ten years, two commercial banks, twenty-one thrift banks, and a staggering 187 rural banks have collapsed, often quite suddenly and without warning. Regulators do have a problem bank list that they do not divulge to the public, for fear of sparking another bank run. So who can the public turn to, to advise them where to put their money? No one, except the banks themselves who will always promote their self-interests. This analysis is an attempt to fill in that knowledge gap, by screening out the weaker banks that seem ready to implode at any given moment.

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. The basic premise is that a bank with Distressed Assets greater than its Capital Cushion is in danger of insolvency, because a significant drop in the value of  the Distressed Assets will eat into a significant amount of the bank's capital.  For a more detailed discussion of this ratio, please visit a previous blog post: The Texas Ratio of Select Philippine Banks  

Based on the individual Published Statements of Condition for the Philippine Banking Industry (from www.bsp.gov.ph), Total Distressed Assets of Philippine Banks decreased by Php 19.002 billion or 2.88% from September 30, 2015.  This increase was partially offset by a 1.22% increase in their Total Capital Cushion during the same period.  As a result, the Ratio of Total Distressed Assets to Total Capital Cushion of Philippine Commercial Banks decreased by 2.20%, from 49.11% as of September 30, 2015 to 46.91% as of December 31, 2015. On a year on year basis, the Distressed Asset Ratio has dropped 7.51% from 54.20% as of December 31, 2014 to just 46.91% as of December 31, 2015.

Those banks that posted significant improvements (25% or more) in this ratio include (Distressed banks are highlighted in yellow, failed banks are highlighted in red).
:

1. Comsavings Bank (114.94% decrease)
2. JP Morgan Chase Bank National Association (82.90% decrease)
3. Legazpi Savings Bank Inc (59.60% decrease)
4. United Overseas Bank Philippines (59.35% decrease)
5. The Bank of Tokyo-Mitsubishi UFJ Ltd (49.83% decrease)
6. BDO Private Bank (36.97% decrease)
7. Merchants Savings & Loan Association Inc (33.95% decrease)
8. Sumitomo Mitsui Banking Corporation - Manila Branch (33.74% decrease)
9. Tongyang Savings Bank Inc (31.52% decrease)
10. Sterling Bank of Asia Inc (30.69% decrease)
11. Opportunity Kauswagan Bank Inc (30.19% decrease)
12. Standard Chartered Bank (28.81% decrease)
13. Bank of America N.A. (28.21% decrease)
14. Philippine Resources Savings Banking Corporation (25.46% decrease)

The decrease in Comsavings Bank's distressed ratio is highly unusual.  The distressed ratio went down not because its distressed assets went down significantly.  It went down because its total capital cushion became negative.  In other words, it lost so much money that it no longer had any real capital backing up its assets.  Hence, it was only a matter of time before the bank closed.  And, true enough, it was forced to close by the BSP/Monetary Board last May 13, 2016.

The banks that exhibited significant deterioration (25% or more) in this ratio include:

1. Penbank Inc. (139.45% increase)
2. Century Savings Bank Corporation (124.55% increase)
3. Optimum Development Bank Inc (99.78% increase)
4. Bangkok Bank Public Co Ltd (52.87% increase)
5. Queen City Development Bank Inc (41.34% increase)
6. Malasiqui Progressive SLB, Inc. (41.12% increase)
7. Metro Cebu Public Savings Bank (36.80% increase)
8. United Coconut Planters Bank (32.00% increase)
9. Bank of China Limited - Manila Branch (31.20% increase)
10. China Bank Savings Inc (30.15% increase)
11. Card SME Bank (28.55% increase)
12. PNB Savings Bank (26.26% increase)

Distressed Banks


Four of the banks with significant increases has been classified as distressed based on their ratio of Total Distressed Assets to Total Capital Cushion as of December 31, 2015. These banks are:

1. Bank of China Limited - Manila Branch (Distressed Ratio of 465.23%)
2. United Coconut Planters Bank (Distressed Ratio of 429.17%)
3. China Bank Savings Inc (Distressed Ratio of 166.75%)
4. Penbank Inc (Distressed Ratio of 157.62%)

The list of Philippine Banks classified as distressed as of December 31, 2015 are as follows:

1. Comsavings Bank (Distressed Ratio of -2,132.39%)
2. Village Bank Inc. (Distressed Ratio of 613.67%)
3. Bank of China Limited - Manila Branch (Distressed Ratio of 465.23%)
4. United Coconut Planters Bank (Distressed Ratio of 429.17%)
5. Legazpi Savings Bank (Distressed Ratio of 386.83%)
6. Inter-Asia Development Bank (Distressed Ratio of 315.28%)
7. Planters Development Bank (Distressed Ratio of 221.89%)
8. China Bank Savings Inc (Distressed Ratio of 166.75%)
9. Penbank Inc (Distressed Ratio of 157.62%)
10. Bank of Commerce (Distressed Ratio of 152.62%)
11. Enterprise Bank Inc. (Distressed Ratio of 141.97%)
12. Deutsche Bank AG (Distressed Ratio of 137.44%)
13. Luzon Development Bank (Distressed Ratio of 133.69%)
14. Bataan Development Bank (Distressed Ratio of 128.57%)
15. Malayan Bank Savings and Mortgage Bank (127.86%)
16. UCPB Savings Bank (Distressed Ratio of 118.29%)
17. Equicom Savings Bank Inc (Distressed Ratio of 116.59%)
18. Dumaguete City Development Bank Inc (Distressed Ratio of 114.11%)

As a group, the distressed banks significant deterioration in their Total Distressed Assets/Total Capital Cushion Ratios.  This ratio now stands at 228.76% as of December 31, 2015, up from 216.79% as of September 30, 2015.  

Departures

There have been several departures from the list of Distressed Banks since September 30, 2015.

1. Philippine Resources Savings Banking Corporation, which had a distressed ratio of 131.06% as of September 30, 2015, dropped out of the list of Distressed Banks with a distressed ratio of 97.63% as of December 31, 2015.
2. World Partners Bank, which had a distressed rato of 113.86% as of September 30, 2015, dropped out of the list of Distressed Banks with a distressed ratio of 89.93% as of December 31, 2015.
3. Opportunity Kauswagan Bank Inc, which had a distressed ratio of 100.46% as of September 30, 2015, dropped out of the list of Distressed Banks with a distressed ratio of 70.14% as of December 31, 2015.

Arrivals

One bank, Penbank Inc, entered the Distressed Banks list with a Distressed Ratio of 157.62% as of December 31, 2015 from a Distressed Ratio of 65.83% as of September 30, 2015.

Philippine Banking System
Total Distressed Assets/ Total Capital Cushion
September 30, 2015 to December 31, 2015
In %
Bank	December 31, 2015	September 30, 2015	Variance	% Variance
PENBANK INC (A PDB) (FORMERLY: PENINSULA RB INC)	157.62%	65.83%	91.79%	139.45%
CENTURY SAVINGS BANK CORPORATION	26.70%	11.89%	14.81%	124.55%
OPTIMUM DEVELOPMENT BANK INC	42.50%	21.28%	21.23%	99.78%
BANGKOK BANK PUBLIC CO LTD	3.72%	2.43%	1.29%	52.87%
QUEEN CITY DEVELOPMENT BANK INC OR QUEENBANK A THRIFT BANK	23.48%	16.61%	6.87%	41.34%
MALASIQUI PROGRESSIVE SLB, INC	16.96%	12.02%	4.94%	41.12%
METRO CEBU PUBLIC SAVINGS BANK	91.18%	66.65%	24.53%	36.80%
UNITED COCONUT PLANTERS BANK	429.17%	325.14%	104.03%	32.00%
BANK OF CHINA LIMITED-MANILA BRANCH	465.23%	354.59%	110.64%	31.20%
CHINA BANK SAVINGS INC	166.75%	128.12%	38.63%	30.15%
CARD SME BANK INC A THRIFT BANK	28.94%	22.51%	6.43%	28.55%
PNB SAVINGS BANK	9.24%	7.32%	1.92%	26.26%
HIYAS BANKING CORPORATION	17.76%	14.62%	3.14%	21.46%
FIRST CONSOLIDATED BANK INC (A PDB)	41.72%	34.75%	6.97%	20.05%
NORTHPOINT DEV'T BANK INC	34.01%	28.35%	5.67%	19.99%
LAND BANK OF THE PHILIPPINES	39.69%	33.80%	5.88%	17.41%
ISLA BANK(A THRIFT BANK) INC	2.32%	2.03%	0.29%	14.43%
RCBC SAVINGS BANK INC	88.16%	77.13%	11.03%	14.30%
EAST WEST BANKING CORP	69.91%	61.71%	8.20%	13.29%
DUNGGANON BANK (A MICROFINANCE THRIFT BANK) INC	49.04%	43.63%	5.41%	12.41%
BPI DIRECT SAVINGS BANK INC	23.38%	21.05%	2.33%	11.07%
EQUICOM SAVINGS BANK INC	116.59%	105.20%	11.39%	10.83%
LIFE SAVINGS BANK INC	53.42%	48.97%	4.45%	9.08%
INTER-ASIA DEVELOPMENT BANK	315.28%	291.12%	24.15%	8.30%
CITY SAVINGS BANK INC	56.76%	52.43%	4.33%	8.26%
SAMPAGUITA SAVINGS BANK INC	35.84%	33.13%	2.71%	8.19%
PHIL BANK OF COMMUNICATIONS	93.83%	86.85%	6.99%	8.04%
ENTERPRISE BANK INC (A THRIFT BANK)	141.97%	131.94%	10.03%	7.60%
HONGKONG & SHANGHAI BANKING CORP	25.31%	23.55%	1.76%	7.48%
CORDILLERA SAVINGS BANK INC	36.44%	34.63%	1.81%	5.21%
UCPB SAVINGS BANK	118.29%	112.63%	5.66%	5.03%
BANK ONE SAVINGS AND TRUST CORP.	40.52%	39.24%	1.28%	3.25%
BPI FAMILY SAVINGS BANK INC	48.04%	46.69%	1.35%	2.89%
CITIBANK, N.A.	99.70%	96.92%	2.78%	2.87%
ANZ BANKING GROUP LTD	16.80%	16.39%	0.41%	2.49%
BANK OF COMMERCE	152.62%	148.92%	3.70%	2.49%
ROBINSONS BANK CORPORATION	34.73%	33.91%	0.83%	2.44%
THE PALAWAN BANK (PALAWAN DB) INC	66.80%	65.25%	1.55%	2.37%
TOWER DEVELOPMENT BANK	34.33%	33.62%	0.70%	2.10%
CTBC BANK (PHILIPPINES) CORP	16.79%	16.54%	0.25%	1.53%
PACIFIC ACE SAVINGS BANK INC	9.48%	9.40%	0.08%	0.84%
DEUTSCHE BANK AG	137.44%	136.43%	1.02%	0.74%
RIZAL COMM'L BANKING CORP	29.87%	29.69%	0.18%	0.60%
MEGA INT'L COMM'L BANK CO LTD	42.25%	42.04%	0.21%	0.49%
MAYBANK PHILIPPINES INC	52.61%	52.35%	0.26%	0.49%
PLANTERS DEVELOPMENT BANK	221.89%	221.37%	0.52%	0.24%
PHIL SAVINGS BANK	79.52%	79.36%	0.16%	0.20%
DUMAGUETE CITY DEV BANK INC	114.11%	114.10%	0.01%	0.01%
PHILIPPINE VETERANS BANK	78.57%	78.72%	-0.15%	-0.19%
QUEZON COCONUT BANK INC (A THRIFT BANK)	25.41%	25.65%	-0.24%	-0.93%
SECURITY BANK CORP	28.34%	28.61%	-0.28%	-0.96%
DEVELOPMENT BANK OF THE PHIL	43.06%	43.49%	-0.43%	-0.99%
HSBC SAVINGS BANK(PHILS) INC	11.84%	12.08%	-0.24%	-1.98%
CHINA BANKING CORP	34.67%	35.56%	-0.89%	-2.52%
BATAAN DEVELOPMENT BANK	128.57%	132.68%	-4.10%	-3.09%
MALAYAN BANK SAVINGS AND MORT BANK INC	127.86%	132.44%	-4.58%	-3.46%
BANK OF THE PHIL ISLANDS	22.02%	22.90%	-0.88%	-3.83%
AL-AMANAH ISLAMIC INVESTMENT BANK OF THE PHILS	8.43%	8.78%	-0.35%	-3.98%
ASIA UNITED BANK CORPORATION	38.64%	40.36%	-1.71%	-4.25%
MIZUHO BANK LTD - MANILA BRANCH	8.88%	9.28%	-0.40%	-4.29%
VILLAGE BANK INC (A THRIFT BANK)	613.67%	644.91%	-31.24%	-4.84%
SUN SAVINGS BANK INC	12.03%	12.76%	-0.73%	-5.69%
UNIVERSITY SAVINGS BANK INC	42.36%	44.98%	-2.62%	-5.83%
PRODUCERS SAVINGS BANK CORPORATION	85.16%	90.58%	-5.42%	-5.98%
PHIL STAR DEVELOPMENT BANK INC	65.59%	69.89%	-4.30%	-6.15%
BANK OF MAKATI (A SAVINGS BANK) INC	69.66%	74.34%	-4.68%	-6.30%
UNION BANK OF THE PHILS	61.50%	65.70%	-4.20%	-6.39%
1ST VALLEY BANK INC A DEVELOPMENT BANK	44.39%	47.62%	-3.23%	-6.78%
PHIL TRUST COMPANY	22.37%	24.07%	-1.70%	-7.07%
BUSINESS AND CONSUMERS BANK (A DB)	18.51%	20.03%	-1.52%	-7.61%
PAMPANGA DEVELOPMENT BANK	35.14%	38.35%	-3.20%	-8.35%
PHIL NATIONAL BANK	54.22%	59.31%	-5.08%	-8.57%
PHILIPPINE BUSINESS BANK INC A SAVINGS BANK	34.18%	37.91%	-3.73%	-9.85%
BDO UNIBANK INC	48.62%	53.96%	-5.34%	-9.90%
LUZON DEVELOPMENT BANK	133.69%	149.68%	-16.00%	-10.69%
FARMERS SAVINGS & LOAN BANK INC	72.79%	82.08%	-9.29%	-11.32%
BATAAN SAVINGS AND LOAN BANK	2.79%	3.18%	-0.39%	-12.20%
MARITIME SAVINGS BANK CORPORATION	46.32%	53.16%	-6.84%	-12.86%
PROGRESS SAVINGS AND LOAN BANK INC	1.67%	1.96%	-0.29%	-14.81%
MBANK PHILIPPINES (A THRIFT BANK) INC	74.64%	87.82%	-13.18%	-15.01%
METROPOLITAN BANK & TCO	29.58%	35.62%	-6.04%	-16.96%
LEMERY SAVINGS & LOAN BANK, INC.	12.64%	15.35%	-2.71%	-17.62%
CITYSTATE SAVINGS BANK INC	43.13%	53.39%	-10.26%	-19.22%
PHIL POSTAL SAVINGS BANK INC	64.58%	80.33%	-15.75%	-19.61%
WORLD PARTNERS BANK (A THRIFT BANK)	89.93%	113.86%	-23.93%	-21.02%
KOREA EXCHANGE BANK	33.80%	43.37%	-9.57%	-22.07%
WEALTH DEVELOPMENT BANK CORPORATION	71.58%	92.50%	-20.92%	-22.62%
ING BANK N.V.	11.41%	14.85%	-3.43%	-23.12%
PHILIPPINE RESOURCES SAVINGS BANKING CORPORATION (PR SAVINGS	97.69%	131.06%	-33.36%	-25.46%
BANK OF AMERICA N.A.	1.20%	1.67%	-0.47%	-28.21%
STANDARD CHARTERED BANK	58.69%	82.44%	-23.75%	-28.81%
OPPORTUNITY KAUSWAGAN BANK INC (A MICROFINANCE THRIFT BANK)	70.14%	100.46%	-30.33%	-30.19%
STERLING BANK OF ASIA INC (A SAVINGS BANK)	57.25%	82.60%	-25.35%	-30.69%
TONGYANG SAVINGS BANK INC	42.23%	61.67%	-19.44%	-31.52%
SUMITOMO MITSUI BANKING CORPORATION-MANILA BRANCH	0.14%	0.22%	-0.07%	-33.74%
MERCHANTS SAVINGS & LOAN ASSN INC	4.17%	6.31%	-2.14%	-33.95%
BDO PRIVATE BANK, INC.	38.33%	60.81%	-22.48%	-36.97%
THE BNK OF TOKYO-MITSUBISHI UFJ LTD	1.38%	2.74%	-1.37%	-49.83%
UNITED OVERSEAS BANK PHILIPPINES	2.54%	6.25%	-3.71%	-59.35%
LEGAZPI SAVINGS BANK INC	386.83%	957.53%	-570.70%	-59.60%
JP MORGAN CHASE BANK NATIONAL ASSN.	2.89%	16.91%	-14.02%	-82.90%
COMSAVINGS BANK	-2132.39%	14272.55%	-16404.95%	-114.94%
CATHAY UNITED BANK CO LTD - MANILA BRANCH	1.44%	NA	NA	NA
INDUSTRIAL BANK OF KOREA MANILA BRANCH	4.43%	NA	NA	NA
SHINHAN BANK - MANILA BRANCH	0.33%	NA	NA	NA
Grand Total	46.91%	49.11%	-2.20%	-4.48%

Philippine Banking System
Total Distressed Assets/ Total Capital Cushion
September 30, 2015 to December 31, 2015
In Php
		December 31, 2015				September 30, 2015				Variance				% Variance
Bank	Total Distressed Assets (In PhP)	Total Capital Cushion (In PhP)	Distressed Assets/ Total Capital Cushion (In %)		Total Distressed Assets (In PhP)	Total Capital Cushion (In PhP)	Distressed Assets/ Total Capital Cushion (In %)		Total Distressed Assets (In PhP)	Total Capital Cushion (In PhP)	Distressed Assets/ Total Capital Cushion (In %)		Total Distressed Assets (In PhP)	Total Capital Cushion (In PhP)	Distressed Assets/ Total Capital Cushion (In %)
VILLAGE BANK INC (A THRIFT BANK)	556,831,461.87	90,737,510.56	613.67%		586,691,256.96	90,972,478.08	644.91%		-29,859,795.09	-234,967.52	-31.24%		-5.09%	-0.26%	-4.84%
BANK OF CHINA LIMITED-MANILA BRANCH	12,360,762,970.29	2,656,902,956.21	465.23%		9,312,937,790.59	2,626,382,043.46	354.59%		3,047,825,179.70	30,520,912.75	110.64%		32.73%	1.16%	31.20%
UNITED COCONUT PLANTERS BANK	36,489,118,835.14	8,502,227,574.02	429.17%		39,563,238,744.27	12,168,057,585.31	325.14%		-3,074,119,909.13	-3,665,830,011.29	104.03%		-7.77%	-30.13%	32.00%
LEGAZPI SAVINGS BANK INC	920,377,443.38	237,928,897.09	386.83%		912,030,912.25	95,248,137.03	957.53%		8,346,531.13	142,680,760.06	-570.70%		0.92%	149.80%	-59.60%
INTER-ASIA DEVELOPMENT BANK	178,434,476.01	56,595,974.69	315.28%		174,622,646.57	59,982,020.81	291.12%		3,811,829.44	-3,386,046.12	24.15%		2.18%	-5.65%	8.30%
PLANTERS DEVELOPMENT BANK	7,711,750,827.00	3,475,549,539.90	221.89%		7,531,812,686.66	3,402,432,371.19	221.37%		179,938,140.34	73,117,168.71	0.52%		2.39%	2.15%	0.24%
CHINA BANK SAVINGS INC	4,180,494,365.12	2,507,115,465.51	166.75%		3,754,455,631.02	2,930,439,126.68	128.12%		426,038,734.10	-423,323,661.17	38.63%		11.35%	-14.45%	30.15%
PENBANK INC (A PDB) (FORMERLY: PENINSULA RB INC)	695,613,033.52	441,321,528.25	157.62%		256,740,479.88	390,025,434.32	65.83%		438,872,553.64	51,296,093.93	91.79%		170.94%	13.15%	139.45%
BANK OF COMMERCE	27,469,383,309.13	17,998,319,986.63	152.62%		27,286,938,682.14	18,323,297,925.40	148.92%		182,444,626.99	-324,977,938.77	3.70%		0.67%	-1.77%	2.49%
ENTERPRISE BANK INC (A THRIFT BANK)	415,058,576.41	292,351,344.09	141.97%		391,142,209.48	296,449,412.77	131.94%		23,916,366.93	-4,098,068.68	10.03%		6.11%	-1.38%	7.60%
DEUTSCHE BANK AG	3,287,852,162.30	2,392,198,121.84	137.44%		3,237,159,085.00	2,372,844,463.03	136.43%		50,693,077.30	19,353,658.81	1.02%		1.57%	0.82%	0.74%
LUZON DEVELOPMENT BANK	835,187,995.92	624,743,120.16	133.69%		930,703,790.74	621,783,393.75	149.68%		-95,515,794.82	2,959,726.41	-16.00%		-10.26%	0.48%	-10.69%
BATAAN DEVELOPMENT BANK	114,933,644.48	89,393,285.17	128.57%		113,975,610.50	85,905,802.10	132.68%		958,033.98	3,487,483.07	-4.10%		0.84%	4.06%	-3.09%
MALAYAN BANK SAVINGS AND MORT BANK INC	1,536,604,993.38	1,201,791,661.66	127.86%		1,666,559,023.83	1,258,362,603.04	132.44%		-129,954,030.45	-56,570,941.38	-4.58%		-7.80%	-4.50%	-3.46%
UCPB SAVINGS BANK	2,969,881,907.55	2,510,649,604.22	118.29%		2,855,304,853.03	2,535,105,369.48	112.63%		114,577,054.52	-24,455,765.26	5.66%		4.01%	-0.96%	5.03%
EQUICOM SAVINGS BANK INC	918,149,056.60	787,522,895.46	116.59%		847,402,866.84	805,544,567.59	105.20%		70,746,189.76	-18,021,672.13	11.39%		8.35%	-2.24%	10.83%
DUMAGUETE CITY DEV BANK INC	291,959,317.81	255,851,728.23	114.11%		291,929,493.67	255,852,431.72	114.10%		29,824.14	-703.49	0.01%		0.01%	0.00%	0.01%
CITIBANK, N.A.	18,715,922,943.50	18,771,848,958.62	99.70%		18,211,358,068.66	18,789,435,269.76	96.92%		504,564,874.84	-17,586,311.14	2.78%		2.77%	-0.09%	2.87%
PHILIPPINE RESOURCES SAVINGS BANKING CORPORATION (PR SAVINGS	2,561,487,859.99	2,622,024,132.32	97.69%		3,002,146,809.88	2,290,748,378.91	131.06%		-440,658,949.89	331,275,753.41	-33.36%		-14.68%	14.46%	-25.46%
PHIL BANK OF COMMUNICATIONS	8,887,320,112.47	9,471,477,821.60	93.83%		8,136,578,941.58	9,368,981,860.26	86.85%		750,741,170.89	102,495,961.34	6.99%		9.23%	1.09%	8.04%
METRO CEBU PUBLIC SAVINGS BANK	63,358,188.31	69,486,128.97	91.18%		46,717,192.90	70,092,561.44	66.65%		16,640,995.41	-606,432.47	24.53%		35.62%	-0.87%	36.80%
WORLD PARTNERS BANK (A THRIFT BANK)	172,285,994.70	191,585,861.61	89.93%		189,668,519.40	166,585,861.61	113.86%		-17,382,524.70	25,000,000.00	-23.93%		-9.16%	15.01%	-21.02%
RCBC SAVINGS BANK INC	8,837,230,482.65	10,023,657,142.95	88.16%		7,869,792,162.25	10,203,153,646.01	77.13%		967,438,320.40	-179,496,503.06	11.03%		12.29%	-1.76%	14.30%
PRODUCERS SAVINGS BANK CORPORATION	1,240,804,615.51	1,457,066,010.86	85.16%		1,326,953,829.23	1,465,017,507.61	90.58%		-86,149,213.72	-7,951,496.75	-5.42%		-6.49%	-0.54%	-5.98%
PHIL SAVINGS BANK	16,072,923,193.52	20,212,951,724.56	79.52%		16,336,858,181.63	20,585,524,164.89	79.36%		-263,934,988.11	-372,572,440.33	0.16%		-1.62%	-1.81%	0.20%
PHILIPPINE VETERANS BANK	5,924,066,797.76	7,540,206,089.93	78.57%		5,907,656,189.99	7,504,813,416.35	78.72%		16,410,607.77	35,392,673.58	-0.15%		0.28%	0.47%	-0.19%
MBANK PHILIPPINES (A THRIFT BANK) INC	103,367,240.56	138,490,935.75	74.64%		119,342,317.31	135,896,741.39	87.82%		-15,975,076.75	2,594,194.36	-13.18%		-13.39%	1.91%	-15.01%
FARMERS SAVINGS & LOAN BANK INC	97,216,870.25	133,562,122.39	72.79%		109,500,523.29	133,414,326.27	82.08%		-12,283,653.04	147,796.12	-9.29%		-11.22%	0.11%	-11.32%
WEALTH DEVELOPMENT BANK CORPORATION	427,302,772.57	596,983,917.19	71.58%		433,527,529.68	468,671,548.58	92.50%		-6,224,757.11	128,312,368.61	-20.92%		-1.44%	27.38%	-22.62%
OPPORTUNITY KAUSWAGAN BANK INC (A MICROFINANCE THRIFT BANK)	114,771,016.15	163,639,623.55	70.14%		118,397,407.67	117,849,958.64	100.46%		-3,626,391.52	45,789,664.91	-30.33%		-3.06%	38.85%	-30.19%
EAST WEST BANKING CORP	22,846,174,246.04	32,680,775,377.21	69.91%		19,964,130,375.11	32,352,918,702.23	61.71%		2,882,043,870.93	327,856,674.98	8.20%		14.44%	1.01%	13.29%
BANK OF MAKATI (A SAVINGS BANK) INC	4,955,808,875.23	7,114,206,210.36	69.66%		5,292,667,031.14	7,119,281,814.59	74.34%		-336,858,155.91	-5,075,604.23	-4.68%		-6.36%	-0.07%	-6.30%
THE PALAWAN BANK (PALAWAN DB) INC	31,892,921.37	47,745,091.20	66.80%		30,451,113.27	46,667,234.58	65.25%		1,441,808.10	1,077,856.62	1.55%		4.73%	2.31%	2.37%
PHIL STAR DEVELOPMENT BANK INC	60,631,606.02	92,434,555.46	65.59%		56,987,238.58	81,537,914.22	69.89%		3,644,367.44	10,896,641.24	-4.30%		6.40%	13.36%	-6.15%
PHIL POSTAL SAVINGS BANK INC	803,325,935.02	1,243,958,319.41	64.58%		982,225,633.00	1,222,732,902.71	80.33%		-178,899,697.98	21,225,416.70	-15.75%		-18.21%	1.74%	-19.61%
UNION BANK OF THE PHILS	36,169,588,730.40	58,816,804,232.91	61.50%		39,401,355,093.22	59,975,943,349.83	65.70%		-3,231,766,362.82	-1,159,139,116.92	-4.20%		-8.20%	-1.93%	-6.39%
STANDARD CHARTERED BANK	5,067,978,164.37	8,635,581,181.80	58.69%		6,701,832,599.27	8,129,787,326.54	82.44%		-1,633,854,434.90	505,793,855.26	-23.75%		-24.38%	6.22%	-28.81%
STERLING BANK OF ASIA INC (A SAVINGS BANK)	1,717,659,856.98	3,000,181,680.46	57.25%		2,474,200,398.43	2,995,499,703.55	82.60%		-756,540,541.45	4,681,976.91	-25.35%		-30.58%	0.16%	-30.69%
CITY SAVINGS BANK INC	4,030,650,073.02	7,101,759,477.50	56.76%		3,676,167,681.38	7,012,062,793.29	52.43%		354,482,391.64	89,696,684.21	4.33%		9.64%	1.28%	8.26%
PHIL NATIONAL BANK	59,848,291,624.96	110,370,895,592.80	54.22%		62,145,010,385.51	104,784,019,647.27	59.31%		-2,296,718,760.55	5,586,875,945.53	-5.08%		-3.70%	5.33%	-8.57%
LIFE SAVINGS BANK INC	33,523,759.03	62,751,735.28	53.42%		30,570,224.43	62,421,172.56	48.97%		2,953,534.60	330,562.72	4.45%		9.66%	0.53%	9.08%
MAYBANK PHILIPPINES INC	6,515,342,319.16	12,385,233,303.26	52.61%		6,460,729,396.47	12,341,662,616.58	52.35%		54,612,922.69	43,570,686.68	0.26%		0.85%	0.35%	0.49%
DUNGGANON BANK (A MICROFINANCE THRIFT BANK) INC	56,364,519.64	114,937,457.76	49.04%		51,233,729.66	117,437,445.75	43.63%		5,130,789.98	-2,499,987.99	5.41%		10.01%	-2.13%	12.41%
BDO UNIBANK INC	98,102,231,590.59	201,767,104,648.56	48.62%		109,560,305,711.08	203,026,313,286.08	53.96%		-11,458,074,120.49	-1,259,208,637.52	-5.34%		-10.46%	-0.62%	-9.90%
BPI FAMILY SAVINGS BANK INC	13,411,703,652.61	27,919,976,261.70	48.04%		13,102,999,255.46	28,065,488,922.04	46.69%		308,704,397.15	-145,512,660.34	1.35%		2.36%	-0.52%	2.89%
MARITIME SAVINGS BANK CORPORATION	33,069,060.15	71,387,932.99	46.32%		37,330,608.97	70,225,528.64	53.16%		-4,261,548.82	1,162,404.35	-6.84%		-11.42%	1.66%	-12.86%
1ST VALLEY BANK INC A DEVELOPMENT BANK	587,490,604.56	1,323,594,513.27	44.39%		663,281,441.67	1,392,982,151.62	47.62%		-75,790,837.11	-69,387,638.35	-3.23%		-11.43%	-4.98%	-6.78%
CITYSTATE SAVINGS BANK INC	275,250,164.90	638,242,673.73	43.13%		314,015,250.53	588,204,412.38	53.39%		-38,765,085.63	50,038,261.35	-10.26%		-12.34%	8.51%	-19.22%
DEVELOPMENT BANK OF THE PHIL	17,413,593,146.64	40,438,527,157.56	43.06%		17,586,356,373.85	40,436,334,044.11	43.49%		-172,763,227.21	2,193,113.45	-0.43%		-0.98%	0.01%	-0.99%
OPTIMUM DEVELOPMENT BANK INC	361,665,782.06	850,883,455.83	42.50%		170,390,865.67	800,883,455.83	21.28%		191,274,916.39	50,000,000.00	21.23%		112.26%	6.24%	99.78%
UNIVERSITY SAVINGS BANK INC	117,855,442.23	278,208,871.37	42.36%		121,627,077.05	270,380,528.62	44.98%		-3,771,634.82	7,828,342.75	-2.62%		-3.10%	2.90%	-5.83%
MEGA INT'L COMM'L BANK CO LTD	864,564,048.14	2,046,293,143.61	42.25%		862,603,009.09	2,051,701,468.93	42.04%		1,961,039.05	-5,408,325.32	0.21%		0.23%	-0.26%	0.49%
TONGYANG SAVINGS BANK INC	484,451,661.51	1,147,287,423.81	42.23%		300,163,257.92	486,763,080.03	61.67%		184,288,403.59	660,524,343.78	-19.44%		61.40%	135.70%	-31.52%
FIRST CONSOLIDATED BANK INC (A PDB)	1,432,239,826.52	3,433,302,388.62	41.72%		1,195,337,259.92	3,439,980,028.60	34.75%		236,902,566.60	-6,677,639.98	6.97%		19.82%	-0.19%	20.05%
BANK ONE SAVINGS AND TRUST CORP.	231,555,755.08	571,463,820.50	40.52%		222,105,782.76	565,963,820.50	39.24%		9,449,972.32	5,500,000.00	1.28%		4.25%	0.97%	3.25%
LAND BANK OF THE PHILIPPINES	26,521,882,544.07	66,830,223,203.17	39.69%		22,606,849,676.27	66,881,744,896.42	33.80%		3,915,032,867.80	-51,521,693.25	5.88%		17.32%	-0.08%	17.41%
ASIA UNITED BANK CORPORATION	8,816,108,552.24	22,813,757,200.34	38.64%		9,223,994,989.97	22,855,041,163.68	40.36%		-407,886,437.73	-41,283,963.34	-1.71%		-4.42%	-0.18%	-4.25%
BDO PRIVATE BANK, INC.	1,991,186,413.35	5,195,464,795.47	38.33%		3,463,143,928.70	5,695,275,746.03	60.81%		-1,471,957,515.35	-499,810,950.56	-22.48%		-42.50%	-8.78%	-36.97%
CORDILLERA SAVINGS BANK INC	49,451,500.15	135,707,437.08	36.44%		42,502,392.68	122,715,955.56	34.63%		6,949,107.47	12,991,481.52	1.81%		16.35%	10.59%	5.21%
SAMPAGUITA SAVINGS BANK INC	24,382,354.12	68,031,335.44	35.84%		25,508,683.88	77,002,857.45	33.13%		-1,126,329.76	-8,971,522.01	2.71%		-4.42%	-11.65%	8.19%
PAMPANGA DEVELOPMENT BANK	51,763,415.91	147,295,553.37	35.14%		57,420,693.04	149,746,531.58	38.35%		-5,657,277.13	-2,450,978.21	-3.20%		-9.85%	-1.64%	-8.35%
ROBINSONS BANK CORPORATION	2,476,960,025.47	7,131,138,838.50	34.73%		2,408,270,999.08	7,102,390,426.44	33.91%		68,689,026.39	28,748,412.06	0.83%		2.85%	0.40%	2.44%
CHINA BANKING CORP	21,375,336,360.21	61,657,963,250.77	34.67%		20,174,001,620.49	56,728,225,006.75	35.56%		1,201,334,739.72	4,929,738,244.02	-0.89%		5.95%	8.69%	-2.52%
TOWER DEVELOPMENT BANK	42,580,044.10	124,042,467.87	34.33%		41,746,729.87	124,163,606.76	33.62%		833,314.23	-121,138.89	0.70%		2.00%	-0.10%	2.10%
PHILIPPINE BUSINESS BANK INC A SAVINGS BANK	3,250,565,001.03	9,510,357,183.27	34.18%		3,182,774,303.76	8,394,739,961.91	37.91%		67,790,697.27	1,115,617,221.36	-3.73%		2.13%	13.29%	-9.85%
NORTHPOINT DEV'T BANK INC	133,263,339.90	391,796,179.33	34.01%		109,562,568.71	386,507,164.00	28.35%		23,700,771.19	5,289,015.33	5.67%		21.63%	1.37%	19.99%
KOREA EXCHANGE BANK	537,290,604.13	1,589,721,674.36	33.80%		547,213,422.73	1,261,707,874.24	43.37%		-9,922,818.60	328,013,800.12	-9.57%		-1.81%	26.00%	-22.07%
RIZAL COMM'L BANKING CORP	17,025,540,815.97	56,993,402,695.31	29.87%		16,895,227,377.69	56,898,889,169.81	29.69%		130,313,438.28	94,513,525.50	0.18%		0.77%	0.17%	0.60%
METROPOLITAN BANK & TCO	58,130,228,624.45	196,505,872,177.64	29.58%		64,528,480,043.48	181,134,120,112.92	35.62%		-6,398,251,419.03	15,371,752,064.72	-6.04%		-9.92%	8.49%	-16.96%
CARD SME BANK INC A THRIFT BANK	135,898,655.32	469,570,782.19	28.94%		110,346,616.79	490,149,365.03	22.51%		25,552,038.53	-20,578,582.84	6.43%		23.16%	-4.20%	28.55%
SECURITY BANK CORP	13,743,154,799.18	48,500,210,695.19	28.34%		14,150,968,994.17	49,458,131,546.94	28.61%		-407,814,194.99	-957,920,851.75	-0.28%		-2.88%	-1.94%	-0.96%
CENTURY SAVINGS BANK CORPORATION	247,008,554.87	925,073,723.73	26.70%		110,002,006.56	925,073,723.73	11.89%		137,006,548.31	0.00	14.81%		124.55%	0.00%	124.55%
QUEZON COCONUT BANK INC (A THRIFT BANK)	15,088,359.03	59,379,139.84	25.41%		15,183,289.12	59,196,234.01	25.65%		-94,930.09	182,905.83	-0.24%		-0.63%	0.31%	-0.93%
HONGKONG & SHANGHAI BANKING CORP	3,640,650,557.31	14,385,254,431.09	25.31%		3,288,008,479.12	13,963,886,205.38	23.55%		352,642,078.19	421,368,225.71	1.76%		10.73%	3.02%	7.48%
QUEEN CITY DEVELOPMENT BANK INC OR QUEENBANK A THRIFT BANK	160,664,246.77	684,403,924.57	23.48%		113,691,679.13	684,504,857.57	16.61%		46,972,567.64	-100,933.00	6.87%		41.32%	-0.01%	41.34%
BPI DIRECT SAVINGS BANK INC	345,221,925.17	1,476,402,643.66	23.38%		311,239,463.47	1,478,391,202.54	21.05%		33,982,461.70	-1,988,558.88	2.33%		10.92%	-0.13%	11.07%
PHIL TRUST COMPANY	4,921,869,749.77	22,004,630,410.34	22.37%		5,055,047,219.30	21,001,686,271.14	24.07%		-133,177,469.53	1,002,944,139.20	-1.70%		-2.63%	4.78%	-7.07%
BANK OF THE PHIL ISLANDS	32,194,818,542.44	146,178,482,570.03	22.02%		34,930,378,843.25	152,522,913,744.36	22.90%		-2,735,560,300.81	-6,344,431,174.33	-0.88%		-7.83%	-4.16%	-3.83%
BUSINESS AND CONSUMERS BANK (A DB)	16,591,330.22	89,631,792.07	18.51%		18,381,420.26	91,747,320.51	20.03%		-1,790,090.04	-2,115,528.44	-1.52%		-9.74%	-2.31%	-7.61%
HIYAS BANKING CORPORATION	27,150,110.98	152,853,860.82	17.76%		26,016,358.11	177,908,515.86	14.62%		1,133,752.87	-25,054,655.04	3.14%		4.36%	-14.08%	21.46%
MALASIQUI PROGRESSIVE SLB, INC	10,360,314.44	61,089,755.22	16.96%		7,483,768.83	62,275,078.45	12.02%		2,876,545.61	-1,185,323.23	4.94%		38.44%	-1.90%	41.12%
ANZ BANKING GROUP LTD	743,914,613.19	4,429,020,736.80	16.80%		742,675,681.94	4,531,740,144.08	16.39%		1,238,931.25	-102,719,407.28	0.41%		0.17%	-2.27%	2.49%
CTBC BANK (PHILIPPINES) CORP	1,175,526,647.89	7,000,985,936.08	16.79%		1,154,355,984.90	6,980,131,005.73	16.54%		21,170,662.99	20,854,930.35	0.25%		1.83%	0.30%	1.53%
LEMERY SAVINGS & LOAN BANK, INC.	9,993,861.58	79,034,714.75	12.64%		10,939,040.67	71,262,351.33	15.35%		-945,179.09	7,772,363.42	-2.71%		-8.64%	10.91%	-17.62%
SUN SAVINGS BANK INC	18,450,450.58	153,367,738.08	12.03%		17,061,758.29	133,753,619.60	12.76%		1,388,692.29	19,614,118.48	-0.73%		8.14%	14.66%	-5.69%
HSBC SAVINGS BANK(PHILS) INC	221,111,434.37	1,867,465,111.75	11.84%		216,738,110.16	1,794,263,113.12	12.08%		4,373,324.21	73,201,998.63	-0.24%		2.02%	4.08%	-1.98%
ING BANK N.V.	291,981,780.61	2,557,950,204.78	11.41%		385,959,323.21	2,599,413,228.87	14.85%		-93,977,542.60	-41,463,024.09	-3.43%		-24.35%	-1.60%	-23.12%
PACIFIC ACE SAVINGS BANK INC	7,200,791.49	75,953,107.77	9.48%		7,693,689.08	81,836,447.69	9.40%		-492,897.59	-5,883,339.92	0.08%		-6.41%	-7.19%	0.84%
PNB SAVINGS BANK	1,074,459,089.40	11,633,679,534.67	9.24%		833,141,744.04	11,389,259,551.99	7.32%		241,317,345.36	244,419,982.68	1.92%		28.96%	2.15%	26.26%
MIZUHO BANK LTD - MANILA BRANCH	269,117,232.14	3,029,990,103.14	8.88%		281,192,003.84	3,029,980,661.97	9.28%		-12,074,771.70	9,441.17	-0.40%		-4.29%	0.00%	-4.29%
AL-AMANAH ISLAMIC INVESTMENT BANK OF THE PHILS	31,988,297.17	379,423,835.68	8.43%		33,086,901.48	376,835,401.08	8.78%		-1,098,604.31	2,588,434.60	-0.35%		-3.32%	0.69%	-3.98%
INDUSTRIAL BANK OF KOREA MANILA BRANCH	96,187,069.40	2,171,948,865.28	4.43%		NA	NA	NA		NA	NA	NA		NA	NA	NA
MERCHANTS SAVINGS & LOAN ASSN INC	28,269,141.68	677,751,954.57	4.17%		26,741,344.08	423,480,302.26	6.31%		1,527,797.60	254,271,652.31	-2.14%		5.71%	60.04%	-33.95%
BANGKOK BANK PUBLIC CO LTD	126,476,445.35	3,400,771,927.00	3.72%		81,557,563.15	3,352,385,987.00	2.43%		44,918,882.20	48,385,940.00	1.29%		55.08%	1.44%	52.87%
JP MORGAN CHASE BANK NATIONAL ASSN.	40,699,989.91	1,407,724,000.00	2.89%		238,050,116.60	1,407,957,700.00	16.91%		-197,350,126.69	-233,700.00	-14.02%		-82.90%	-0.02%	-82.90%
BATAAN SAVINGS AND LOAN BANK	1,690,437.78	60,558,902.93	2.79%		1,909,775.90	60,066,683.27	3.18%		-219,338.12	492,219.66	-0.39%		-11.49%	0.82%	-12.20%
UNITED OVERSEAS BANK PHILIPPINES	29,966,382.29	1,179,033,458.56	2.54%		75,216,778.42	1,203,021,283.69	6.25%		-45,250,396.13	-23,987,825.13	-3.71%		-60.16%	-1.99%	-59.35%
ISLA BANK(A THRIFT BANK) INC	15,241,015.34	656,964,240.35	2.32%		13,319,376.93	656,964,240.35	2.03%		1,921,638.41	0.00	0.29%		14.43%	0.00%	14.43%
PROGRESS SAVINGS AND LOAN BANK INC	1,333,533.18	79,824,612.05	1.67%		1,643,315.94	83,800,532.48	1.96%		-309,782.76	-3,975,920.43	-0.29%		-18.85%	-4.74%	-14.81%
CATHAY UNITED BANK CO LTD - MANILA BRANCH	30,525,458.29	2,126,668,534.24	1.44%		NA	NA	NA		NA	NA	NA		NA	NA	NA
THE BNK OF TOKYO-MITSUBISHI UFJ LTD	68,329,868.80	4,967,420,166.75	1.38%		136,187,317.43	4,967,420,166.75	2.74%		-67,857,448.63	0.00	-1.37%		-49.83%	0.00%	-49.83%
BANK OF AMERICA N.A.	25,422,826.12	2,123,761,205.20	1.20%		35,414,711.82	2,123,761,205.20	1.67%		-9,991,885.70	0.00	-0.47%		-28.21%	0.00%	-28.21%
SHINHAN BANK - MANILA BRANCH	7,219,274.96	2,201,623,570.00	0.33%		NA	NA	NA		NA	NA	NA		NA	NA	NA
SUMITOMO MITSUI BANKING CORPORATION-MANILA BRANCH	18,564,130.99	13,002,370,356.34	0.14%		28,020,425.55	13,003,849,252.82	0.22%		-9,456,294.56	-1,478,896.48	-0.07%		-33.75%	-0.01%	-33.74%
COMSAVINGS BANK	1,395,614,335.77	-65,448,243.20	-2132.39%		1,394,627,167.58	9,771,392.48	14272.55%		987,168.19	-75,219,635.68	-16404.95%		0.07%	-769.79%	-114.94%
	641,217,656,678.96	1,366,947,320,465.19	46.91%		660,085,197,929.81	1,344,065,152,569.39	49.11%		-19,001,473,053.50	16,381,926,926.28	-2.20%		-2.88%	1.22%	-4.48%

Source: www.bsp.gov.ph

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 December 31, 2015 and September 30, 2015 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.

The Great Bangladesh Central Bank Heist of 2016: So Whose Heads Have Rolled in RCBC?

Last March 22, 2016, in a post entitled "The Great Bangladesh Central Bank Heist of 2016: Whose Heads Should Roll in RCBC?", we speculated on who in RCBC might not survive the aftermath of the largest banking scandal to ever hit the country.

We came up with a hit list of names and why they could or should be on that list based on publicly available information available in news reports, SEC disclosures, downloadable annual reports, as well as corporate websites.

We examined RCBC's organizational chart to come up with a list of possible multiple points of failure in RCBC's compliance system (and given a banking scandal of this magnitude, there were many points of failure).  So, we came up with this list:

Branch Level 

Retail Banking Group 

BASE60 

Compliance Office 

Internal Audit 

Legal and Regulatory Affairs 

President & CEO 

Audit Committee

Based on this list, we then came up with this list of names:

• Raul Victor B. Tan, EVP, former Head of Retail Banking Group
• Ma. Fe P. Salamatin, FVP, current Compliance Officer and Head of its Regulatory Affairs Division
• Ruth Mendez Aninon, FVP, current Head, Compliance Testing & Monitoring Department, Compliance Office, Regulatory Affairs Division
• Ana Luisa S. Lim, FVP, current Head of Internal Audit Group
• Maria Celia H. Fernandez-Estavillo, EVP and Corporate Secretary, Head of the Legal and Regulatory Affairs Group
• Lorenzo Tan, President & CEO
• Armando M. Medina, Chairman, Audit Committee
• Medel T. Nera, Member, Audit Committee
• Francisco C. Eizmendi, Jr., Member, Audit Committee

Since then, there has been a rash of departures from the bank, which may or may not be related to the scandal.

One of the first to go, aside from the top officers of RCBC Jupiter Branch, was Raul Victor B. Tan, Treasurer and EVP and former Head of the Retail Banking Group who resigned from the bank, effective April 20, 2016, for personal reasons.  According to the SEC disclosure, RCBC's internal investigation had "previously cleared Mr. Raul Tan of any participation in or breach of banking policies with respect to the $81M money laundering issue."

Next was RCBC President & CEO Lorenzo Tan, who only promised to and did go on leave, resigned, probably not as an admission of guilt or an act of contrition but as an expression of honor, of putting his institution ahead of himself." According to the bank,

"an internal investigation into the alleged USD 81 million money laundering had cleared Mr. Tan of any breach of bank rules and policies. He resigned to give the Board a free hand in directing the course of the Bank’s future.”

Mr. Tan's resignation was effective on May 6, 2016. His replacement was announced by the bank a mere ten days later. Current DBP President Gil Buenaventura will step into Lorenzo Tan's role on July 1, 2016.



On May 16, Jennie F. Lansang, the bank's Senior Vice President, resigned.  Her Linkedin.com's profile shows that she now serves as the Chief Information Officer of a rival bank, Philippine Bank of Communications (PBCOM).  Her Linkedin profile shows that she served as the Chief Technology Officer (CTO) & Concurrent Head for Shared Technology Services for RCBC from January 2013 to May 2016. It is unclear what Ms. Lansang's role was in the selection and implementation of RCBC's Base60 AML Monitoring System, which was launched during her tenure as RCBC's CTO and which was supposed to generate timely Anti-Money Laundering reports for RCBC's board and senior management.

Will there be more changes to come? Absolutely, especially as incoming President Gil Buenaventura finds his footing in the bank, and brings in his own team, or sidelines many of the Lorenzo Tan-installed executives and officers of the bank. We hope that President Buenaventura revamps RCBC's supposed "culture of compliance" which failed the bank so miserably.

We hope that the board's Audit Committee, which we highlighted as another point of failure in the bank, becomes more diligent in its oversight of the bank's compliance with the many legal and regulatory requirements the bank is burdened with.  Specifically, we hope that Audit Committee member Francisco C. Eizmendi improves his appalling Audit Committee attendance record:

• 2015: 9 out of 15 Audit Committee Meetings (60.00%)
• 2014: 8 out of 13 Audit Committee Meetings (61.54%)
• 2013: 8 out of 15 Audit Committee Meetings (53.33%)

Given Mr. Eizmendi's advanced age (80), perhaps he should retire if he cannot meet the physical demands of attending Audit Committee Meetings on a more consistent basis.  Mr. Eizmendi has been more diligent in attending general board meetings:

• 2015: 9 out of 17 general board meetings (82.35%)
• 2014: 15 out of 16 general board meetings (93.75%)
• 2013: 19 out of 20 general board meetings (95.00%)

Board members are generally busy people. As such, many of the committee meetings are often scheduled on the same day as the general board meeting, most likely for the convenience of the board members.  Assuming this is the practice in RCBC, then there is no reason for Mr. Eizmendi's poor Audit Committee attendance record.  The fact that Mr. Eizmendi's record has been poor for three years running indicates that he may only give lip service to the oversight functions of the Audit Committee at a time when the full attention of all Audit Committee members is sorely needed.

The "tone" of the bank starts at the top, not just at CEO level, but also at board level.  If this does not change, we fully expect the bank to continue as is, emphasizing economic efficiency over compliance until the next scandal erupts, possibly bringing down the bank with it for good.

BSP: GSIS Family Bank aka Comsavings Bank is Better Off Dead

Last May 13, 2016, GSIS Family Bank, also known as Comsavings Bank, was finally shut down by the BSP.  Based on the latest records, the bank had 14,507 deposit accounts with Php 974.81 million in deposits.  Approximately 19.33% of these deposits were over PDIC's Php 500,000 maximum deposit insurance limit.  Therefore, depositors lost Php 188.42 million.

The bank started failing way back in June 2005, when its Classified Loans and Other Risky Assets grew by over 5,000% in one quarter, from only around Php 25 million as of March 2005 to around Php 1.276 billion by June 2005.  The bank had to support this staggering amount of dud loans with only Php 608 million in equity.  As of December 2015, classified loans remained unchanged at Php 1.276 billion but the equity base shrunk to just Php 14.35 million.

The bank was consistently on the top of our list of distressed Philippine banks.  As of September 30, 2015, the bank had an astounding distressed ratio of 14,272.55% - way, way above our cut-off of 100%.  Believe it or not, this number is way down from the comically high ratio of 68,226.10% as of March 2015.

By BSP's own indicators, the bank was failing.  As of December 2015, the bank had Capital Adequacy Ratios of just 2.20 (Total CAR) and 1.74 (Tier 1 CAR).  These numbers are abysmally below BSP's own recommended ratios of 10 for both ratios.

If this bank were a private bank, it would have failed a long time ago.  The government backing increased its longevity but also increased the pain to both the stockholders and depositors.

The bank was put up on the auction block last April 2015 and went through several rounds of bidding and negotiated sale, but nothing materialized.  The last bidder, Phindep Development Corp, a real estate developer based in Kawit, Cavite seemed bogus because it did not seem to have the financial capacity or expertise to run the bank, having just incorporated last March 2015.  The lone legitimate bidder for the bank was Altus Capital Partners Inc., a distressed asset bidder that previously bought the distressed assets of Planters Development Bank last September 2012.  That deal obviously fell through. Apparently, Altus decided that Comsavings Bank was better off dead.

And the BSP concurred.