Banks' capital adequacy ratio remains healthy - BSP

The capital adequacy ratio (CAR) of Philippine banks remain healthy at the end of 2009, the Bangko Sentral ng Pilipinas said Tuesday. The industry’s stand-alone CAR, which pertains only to that of parent banks, was at 14.85 percent at the end of 2009, and at 15.78 percent for the consolidated ratio that included those of the subsidiaries and affiliates, the BSP said. The end-2009 figures were better than the 14.82 percent solo and 15.76 percent consolidated ratios the industry recorded in the third quarter. “The slight improvement in the banking system’s CAR was due to the almost matching growth rate of qualifying capital and risk-weighted assets," BSP Gov. Amando M. Tetangco Jr. said in a statement. The BSP-mandated capital ratio was 10 percent, while the Basel Accord provided for an 8 percent minimum. The ratio measures the amount of capital a bank has in relation to its risk-related assets. —VS, GMANews.TV