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RP banks have adequate capital, says BSP


The capital of banks in relation to risks remains healthy, adequate, and above the norm, the Bangko Sentral ng Pilipinas said Wednesday. Deputy BSP Gov. and officer-in-charge Nestro A. Espenilla Jr. said that the capital adequacy ratio or CAR was above averaged at 14.9 percent for each sub-sector of the banking industry and at 15.95 percent for the industry as a whole as of end-March — the latest figures available. The numbers compare with the global norm of 8 percent, and the BSP’ 10 percent minimum requirement, according to the central bank. CAR is a measure of solvency or the ability of a business to pay its liabilities. BSP data released Wednesday showed that the qualifying capital of the industry’s sub-sectors grew by P3.41 billion or half a percent to P626.2 billion in the first three months of the year. The capital for the whole industry that includes universal banks, commercial banks, rural banks, cooperative banks, and thrift banks went up by P11.09 billion or 1.62 percent to P695.5 billion. The sub-sectors’ risk-weighted assets rose by P7.98 billion or 0.19 percent, while that of the industry as a whole went up by P22.5 billion or 0.52 percent. Rural banks registered a capital adequacy ratio of 19.11 percent both as standalone and on consolidated basis, central bank records showed. The ratios for rural cooperative banks were 18.83 percent (standalone) and 16.06 percent (consolidated). For thrift banks the average ratio was 12.25 percent, and for commercial and universal banks the average was 14.99 percent, according to the central bank The situation in capital adequacy terms allowed Philippine banks to weather the global financial crisis, the Bangko Sentral said. —VS, GMANews.TV

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