Report No. 7177-PH Philippines Financial Sector Study (In Three Volumes) Volume Ill: Statistical Annexes August 23,1988 Industry and Energy Operations Division Country Department II Asia Region FOR OFFICIAL USE ONLY H Document of the World Bank This report has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS US$1.00 = Pesos (P) 20.90 P 1.00 = US$0.047 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS ACPB - Agriculture Credit Policy Council ADB - Asian Development Bank AIC - Average intermediation cost AITTP - Agro-Industrial Technology Transfer Program ALF - Agriculture Loan Fund Apex - Apex Development Finance Unit APT - Asset Privatization Trust ASC - Accounting Standards Council BBP - Bakahang Barangay Program BDP - Biyayang Dagat Program BSKP - Bagong K;.lusang Kaunlaran at Kabuhayan CALF - Comprehensive Agriculture Loan Fund CBP - Central Bank of the Philippines CDLF - Cooperative Development Loan Fund CFI - Court of first instance CFP - Cotton Financing Program CHM - Chattel mortgage CIB - Credit Bureau of Investigation CIGLF - Cottage Industry Guarantee Loan Fund CPA - Certified Public Accountant DA - Department of Agriculture DRP - Development Bank of the Philippines DLC - Department of Loans and Credit DOSRI - Directors, cfficers, stockholders and related interests DTI - Department of Trade and Industry ECP - Expanded Corn Program EIMP - Export Industry Modernization Program GAAP - Generally accepted accounting principles GDP - Gross domestic product GEM - Gross earnings margin GFSME - Guarantee Fund for Small and Medium Enterprises GIM - Gross interest margin GRT - Gross receipts tax GSIS - Government Service Insurance System HYV - High yield variety ICI - Intermediation cost index IGLF - Industrial Guarantee and Loan Fund ILFP - Industrial Loan Fund Program FOR OMCL Use ONLY 'IRPP - Intensified Rice Production Progr ...,. LBP - Land Bank of the Philippines LIBOR - London interbank offered rate MB - Monetary Board MRR - Manila Reference Rate 14-99 - Masagana 99 NEDA - National Economic Development Authority OECF - Overseas Economic Cooperation Fund PCIC - Philippine Crop Insurance Corporation PDIC - Philippine Deposit Insurance Corporation PFI - Participating financial institution PNB - Philippine National Bank QGFB - Quedan Guarantee Fund Board REM - Real estate mortgage SEC - Securities and Exchange Commission SES - Supervision and Examination Sector SME - Small and medium enterprises SMI - Small and medium industry STD - Special time deposit TLRC - Technology and Livelihood Resource Center TRP - Textile Rehabilitation Program T-bills - Treasury Bills ULFP - Urban Livelihood Financing Program Unibanks - Universal banks USAID - United States Agency for International Development USUCC - U.S. Uniform Commercial Code This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. LIST OF ANNEXES 1. National Accounts and Balance of Payments, 1975, 1980-86 2. Sectloral Output, 1979-86 3. Interest Rates, 1970-87 4. Assets of the Financial System 5. Percentage Distribution of Assets of the Financial System 6. Number of Thrift and Rural Banks 7. Savings and Mortgafe Banks' Summarized Consolidated Balance Sheets, as of December 31, 1984-86 8. Savings and Mortgage Banks' Summarized Consolidated Income Statements, for the Years Ended December 31, 1984-86 9. Private Development Bainks' Summarized Consolidated Balance Sheets, as of December 31, 1984-86 10. Private Development Banks' Summarized Consolidated Income Statements, for the Years Ended December 31, 1934-86 11. Stock Savings and Loan Associations' Summarized Consolidated Balance Sheets, as of December 31, 1984-86 12. Stock Savings and Loan Associations' Summarized Consolidated Income Statements, for the Years Ended December 31, 1984-86 13. Rural Banks' Summarized Consolidated Balance Sheets, as of December 31, 1984-86 14. Rural Banks' Summarized Consolidated Income Statements, for the Years Ended December 31, 1984-86 15. Specialized Government Banks' Summarized Consolidated Ealance Sheets, as of December 31, 1984-86 16. Specialized Government Banks' Summarized Consolidated Income Statements, for the Years Ended December 31, 1984-86 17. Profile of the Insurance Industry, 1982-86 18. The Social Security System 19. The Government Service Insurance System: Corporate Balance Sheet, 1985/86 20. Ranking and Selected Balance Sheet Accounts of Individu.al Banks as of September 30, 1987 21. Commercial Banks' Summarized Consolidated Balance Skeets, as of December 31, 1970, 1975, 1980-86 22. Commercial Banks' Summarized Consolidated Income Statements, for the Years Ended December 31, 1970, 1975, 1980-86 23. Analysis of Commercial Banks' Sources and Uses of Funds, 1980-86 24. Performance Ratios of the Commercial Banking System 25. Consolidated Balance Sheets of the Commercial Banking Less PNB 26. Consolidated Income Statements of the Commercial Banking System Less PNB, 1984-86 27. Performance Ratios of the Commercial Banking System Less PNB, 1984-86 28. Analysis of Deposit Structure of Commercial Banks 29. Distribution of Outstanding Loans by Purpose, 1980-86 30. Distribution of Outstanding Loans by Security 31. Distribution of Outstanding Loans by Maturity 32. Commercial Bank Branches by Region, 1976-86 33. Analysis of the Cost of Intermediation, 1983-86 34. Commercial Banks: Analysis of Arrears, December 31, 1986 35. Government-Supervised/Directed Credits: Agriculture 36. Financial Performance of Selected Credit Programs by Year 37. Government-Supervised/Directed Credits: Industry 38. Government-Directed Credit Programs in Agriculture-Subsidization 39. Movements of Exchange Rates, 1982-87 - 1 - ANNEX 1 PHILIPPINES FINANCIAL SECTOR STUDY National Accounts and Balance of Payments, 1975, 1980-86 1975 1980 1981 1982 1983 1984 1985 1986 Constant Prices: Billion 1973 Pesos GNP 68.53 92.63 96.04 97.54 98.62 91.64 87.77 88.09 Personal consumption expenditures 46.16 59.27 61.62 63.54 65.35 66.03 65.98 66.60 Government consumption 7.03 8.27 8.60 9.15 8.69 8.26 8.21 8.55 Fixed capital formation 15.04 22.74 23.54 23.69 23.01 15.59 11.83 10.08 Stocks, increase in 3.95 3.87 3.68 2.58 1.91 -1.38 -0.70 0.12 Export of goods and services 9.95 18.15 17.95 17.67 19.26 20.85 19.35 23.56 Import of goods and services 13.51 19.45 18.85 19.51 21.75 :8.18 14.00 17.56 Statistical discrepancy -0.26 -0.14 -0.32 1.89 3.44 2.75 -0.86 -0.59 Net factor income from abroad 0.17 -0.08 -0.17 -1.46 -1.30 -2.28 -2.04 -1.68 Current Prices: Billion Pesos GNP 114.3 265.1 303.6 335.4 378.7 527.4 594.5 614.3 Personal consumption expenditures 76.2 178.1 206.9 234.5 268.2 403.4 469.1 475.0 Government consumption 10.9 21.2 24.8 29.2 29.5 35.6 42.5 48.6 Fixed capital formation 27.8 81.1 93.3 96.5 102.5 92.0 85.4 82.2 Stocks, increase in 7.9 13.2 14.0 10.5 7.3 -8.1 -4.6 1.2 Export of goods and services 21.3 54.2 57.8 56.2 75.3 117.7 126.6 155.1 Import of goods and services 29.1 68.9 74.4 79.3 101.: 118.4 108.5 116.2 Statistical discrepancy -0.4 0.3 -3.2 3.5 9.8 10.2 -5.6 -17.9 Net factor income from abroad -0.3 -0.9 -1.6 -5.2 -5.4 -13.1 -14.9 -12.4 Personal savings 10.5 15.3 19.9 11.5 3.5 4.9 7.6 27.4 % of personal disposable income 12.1 7.9 8.8 4.7 1.3 1.2 1.6 5.5 Corporate savings 3.2 14.5 16.0 14.9 16.2 -1.7 -3.2 -2.1 General government savings 4.6 13.3 11.4 10.1 16.6 20.5 20.0 18.5 GNP, US$ billion 15.77 35.29 38.43 39.27 34.09 31.58 31.95 30.13 Current account, US$ billion -0.89 -1.90 -2.06 -3.20 -2.75 -1.30 -0.08 1.02 Overall deficit, US$ billion 0.52 0.38 0.56 1.62 2.07 -0.26 -2.39 -1.25 % GNP (Value Basis) Personal consumption expenditures 66.7 67.2 68.1 69.9 70.8 ';6.5 78.9 77.3 Government consumption 9.5 8.0 8.2 8.7 7.8 6.8 7.1 7.9 Fixed capital formation 24.3 30.6 30.7 28.8 27.1 17.4 14.4 13.4 Stocks, increase in 6.9 5.0 4.6 3.1 1.9 -1.5 -0.8 0.2 Export of goods and services 18.6 20.4 19.0 16.8 19.9 22.3 21.3 25.2 Import of goods and services 25.5 26.0 24.5 23.6 26.7 22.4 18.3 18.9 Statistical discrepancy -0.3 0.1 -1.1 1.0 2.6 1.9 -0.9 -2.9 Net factor income from abroad -0.3 -0.3 -0.5 -1.6 -1.4 -2.5 -2.5 -2.0 Current account, US$ billion -5.64 -5.38 -5.36 -8.15 -8.07 -4.12 -0.25 3.39 Overall deficit, US$ billion 3.30 1.08 1.46 4.12 6.07 -0.82 -7.48 -4.15 Source: CBP. - 2 - ANNE% 2 PHILIPPINES FINANCIAL SECTOR STUDY Sectoral Output, 1979-86 1979 1980 1981 1982 1983 1984 19b! 1986 In Billions of Constant 1972 Pesos Gross national product 88.7 92.6 96.0 97.5 98.6 91.6 87.8 89.1 Gross domestic product 88.3 92.7 96.2 99.0 99.9 93.9 89.8 90.8 Agric., fish. and forestry 22.; 23.7 24.6 25.4 24.9 25.4 26.3 27.2 Industry 32.3 33.5 35.0 35.7 36.0 32.3 29.0 28.2 Mining and quarrying 2.13 2.24 2.18 2.00 1.97 1.76 1.77 1.56 Manufacturing 22.2 23.2 24.0 24.5 25.1 23.3 21.5 21.7 Constr"ction 7.12 7.14 7.83 8.08 7.69 5.87 4.26 3.38 Services 33.4 35.5 36.6 37.9 39.1 36.2 34.6 35.3 Trade - - - 13.1 13.9 14.1 14.1 14.3 Finance and housing - - - 7.25 7.58 5.13 3.98 4.06 Banks - - - 2.31 2.41 1.01 0.00 0.22 Percentage Change Gross national product - 4.40 3.67 1.56 1.13 -7.10 -4.15 1.48 Gross domestic product - 4.98 3.78 2.91 0.91 -6.01 -4.37 1.11 Agric., fish. and forestry - 4.87 3.80 3.25 -1.97 2.01 3.54 3.42 Industry - 3.72 4.48 2.00 0.84 -10.28 -10.22 -2.76 f{ining and quarrying - 5.16 -2.68 -8.26 -1.50 -10.66 0.57 -11.86 Manufacturing - 4.30 3.45 2.08 2.45 -7.17 -7.73 0.93 Construction - 0.28 9.66 3.19 -4.83 -23.67 -27.43 -20.66 Services - 6.29 3.10 3.55 3.17 -7.42 -4.42 2.02 Trade - - - - 6.11 1.44 0.00 1.42 Finance and housing - - - - 4.55 -32.32 -22.42 2.01 Banks - - - - 4.33 -58.26 -99.60 5,475.00 Source: CBP. -3- ANNEX 3 PHILIPPINES FINANCIAL SECTOR STUDY Interest Rates, 1970-87 1970 1975 1980 1981 1982 1983 1984 1985 1986 1987 (Sep) Treasury bills: 3 months 13.1 10.3 12.1 12.6 13.8 14.2 40.9 26.2 16.3 10.7 : 6 months 13.9 10.8 12.5 13.1 14.5 14.8 30.5 24.8 14.4 12.2 : 12 months 13.7 10.9 12.8 13.2 14.9 14.9 41.5 35.2 13.2 13.7 Central Bank bills - - - - - - 35.3 27.0 19.1 - Savings deposics 6 6 7 NA 9.8 9.7 9.9 10.8 8.6 6.0 Tlme deposits < 1 year 6.7 8.7 14 NA 14.1 13.7 23.2 21.8 12.3 7.0 Time deposits > 1 year - - - - 16.9 16.4 26.2 21.8 15.6 9.5 Bank loans < 1 year 12 12 14 16 16.8 18.8 26.7 28.3 17.1 12.2 Bank loans > 1 year - - - - 21.6 21.5 26.8 26.3 19.1 14.1 Inflation - 9.5 10.5 8.4 12.0 49.8 17.7 1.8 5 5 (GNP defl year ahead) Real 12-month T-bills - 1.3 2.1 4.4 2.6 -23.3 20.2 32.8 7.8 8.3 ~ ~ 4 ~ ANNEX 4 PHILIPPINES_ FINANCIAL SECTOR STUDY Assets of the Financial System As of December 31, 1970, 1975, 1980-86, and June 30, 1987 (Billion pesos) June 1970 1975 1980 1981 1982 1983 1984 1985 1986 1987 Central Bank 6.0 26.0 65.4 71.6 91.7 13.04 206.0 251.6 313.9 316.0 Banking System 188.8 69.9 188.8 226.0 269.8 331.5 391.8 395.2 297.0 302.6 Commercial banks 14.1 53.2 138.4 164.4 191.0 247.9 289.2 283.3 248.5 253.8/b Private 8.3 35.1 85.1 103.4 111.0 141.7 160.6 168.0 166.6 177.7 Government 4.6 18.1 34.6 40.6 53.3 65.2 80.4 70.3 34.8 29.3 Foreign 1.2 - 18.7 20.6 26.7 41.0 48.2 45.0 47.1 46.8 Thrift banks 0.9 2.1 10.6 11.6 12.6 16.1 15.0 15.1 17.6 17.2/b Savings 0.7 1.4 7.4 6.9 5.9 7.4 7.6 6.8 8.1 8.4 Private development banks 0 2 0.4 1.6 2.6 3.7 4.6 4.6 5.1 5.6 4.9 Stock savings & loan associations - 0.3 1.6 2.1 3.0 4.1 2.8 3.2 3.9 3.9 Rural banks 0.7 2.8 5.6 6.6 8.1 9.5 9.0 8.8 9.3 9.5 Specialized government banks 3.1 11.8 34.2 43.2 53.3 65.3 78.6 88.0 28.6/e 27.4/e,/d Nonbank Financial Intermediaries 6.1 26.8 58.9 63.3 74.2 92.u 95.5 107.2 112.9 118.3 Insurance companias 5.9 11.9 29.5 33.3 40.7 44.6 50.0 60.8 70.8 74.7 Government /a 4.0 7.7 19.5 22.0 27.0 30.9 35.9 42.7 50.5 54.4/e Private 1.9 4.2 10.0 11.3 13.7 13.7 14.1 18.1 20.3 20.3 Investment institutions - 10.3 25.6 23.5 25.6 25.2 19.7 23.8 23.2 23.8/c Financing companies - 3.5 11.9 12.1 12.9 11.8 9.6 6.2 5.6 5.6 Investment companies - 2.0 5.0 5.5 5.9 6.2 2.6 11.0 10.1 9.9 Investment houses 4.8 8.7 5.9 6.8 7.2 7.5 6.6 7.5 8.3 Trust operations (fund managers) - 2.6 1.7 0.8 1.1 1.5 0.9 1.6 1.3 1.6/c Other financial intermediaries 0.2 2.0 2.1 5.8 6.8 20.7 24.9 21.0 17.6 18.2 Total 200.9 122.7 313.1 36C.9 435.7 553.9 693.3 754.0 723.8 736.9 /a Includes GSIS and SSS. /b M.1 1987. /c March 1987. /d Preliminary. /e After transfer of certain assets and liabilities to the government. Source: CBP. - ANNEX 5 PHILIPPINES FINANCIAL SECTOR STUDY Percentage Distribution of Assets of the Financial System As of December 31, 1970, 1975, 1980-86, and June 30. 1987 June 1970 1975 1980 1981 1982 1983 1984 1985 1986 1987 Central Bank 19.4 21.2 20.9 19.9 21.1 23.6 29.7 33.4 43.4 42.9 Banking System 60.8 57.0 60.3 62.6 61.9 59.8 56.5 52.4 41.0 41.1 Commercial banks 45.6 43.4 44.2 45.6 44.9 43.4 41.7 37.5 33.4 33.7 Private 26.8 28.6 27.2 28.7 26.6 24.2 23.2 22.3 22.1 23.4 Government 14.9 14.8 11.0 11.2 12.2 11.8 11.6 9.3 4.8 4.0 Foreign 3.9 - 6.0 5.7 6.1 7.4 6.9 5.9 6.5 6.3 Thrift banks 2.9 1.7 3.4 3.2 2.9 2.9 2.2 2.0 2.4 2.4 Savings 2.3 1.1 2.4 1.9 1.4 1.3 1.1 0.9 1.1 1.2 Private development 0.6 0.3 0.5 0.7 0.8 0.8 0.7 0.7 0.8 0.7 Stock savings & loan associations - 0.3 0.5 0.6 0.7 0.8 0.4 0.4 0.5 0.5 Rural banks 2.3 2.3 1.8 1.8 1.9 1.7 1.3 1.2 1.3 1.3 Specialized government banks 10.0 9.6 10.9 12.0 12.2 11.8 11.3 11.7 3.9 3.7 Nonbank Financial Intermediaries 19.8 21.8 18.8 17.5 17.0 16.6 13.8 14.2 15.6 16.0 Insurance companies 19.1 9.7 9.4 9.2 9.3 8.1 7.2 8.1 9.8 10.1 Government /a 12.9 6.3 6.2 6.1 6.2 5.6 5.2 5.7 7.0 7.4 Private 6.2 3.4 3.2 3.1 3.1 2.5 2.0 2.4 2.R 2.7 Investment institutions - 8.4 8.2 6.5 5.9 4.5 2.9 3.1 3.2 3.2 Financing companies - 2.9 3.8 3.4 3.0 2.1 1.4 0.8 0.8 0.8 Investment companies - 1.6 1.6 1.5 1.3 1.1 0.4 1.4 1.4 1.3 Investment houses - 3.9 2.8 1.6 1.6 1.3 1.1 0.9 1.0 1.1 Trust operations (fund managers) - 2.1 0.5 0.2 0.2 0.3 0.1 0.2 0.2 0.2 Other financial intermediaries 0.7 1.6 0.7 1.6 1.6 3.7 3.6 2.8 2.4 2.5 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 /a Includes GSIS and SSS. Source: CBP. ANNEX 6 PHILIPPINES FINANCIAL SECTOR STUDY Number of Thrift and Rural Banks As of December 31, 1970, 1975, 1980-86, and May 31, 1987 Thrift banks Stock Savings and Private devel- savings and loan Grand total mortgage banks opment banks associations Total Rural banks Head Head Head Read Read Head office Brancbes office Branches office Branches office Branches office Branches office Branches Total 1970 557 88 14 42 29 23 28 - 71 67 486 21 507 1975 855 211 10 81 33 53 44 25 87 159 768 52 820 1980 1,129 640 10 258 43 111 91 160 144 529 985 111 1,096 1981 1,180 624 9 178 44 138 87 181 140 497 1,040 127 1,167 1982 1,096 692 8 185 45 158 84 196 137 539 959 153 1,112 1983 1,085 774 8 201 45 173 83 198 136 572 949 202 1,151 1984 1,061 746 8 203 43 166 70 160 121 529 940 217 1,157 1985 1,022 756 7 219 45 170 66 154 118 543 904 213 1,117 1986 993 757 7 224 43 170 66 155 116 549 877 208 1,085 1987 971 753 7 224 42 161 65 158 114 543 857 210 1,067 Source: CBP. - 7 - ANNEX 7 PHILIPFINES FINANCIAL SECTOR STLDY Savings and Mortgaae Banks' Sutmarlzed Consolidated Balance Sheets. as of December 31, 1984-8b (Million pesos) 1984 1985 1986 Assets MasM and Due From Banks 757.3 1,131.9 1.131.7 Cash on hand l7 19a . :SU.) Check and other cash items 23.5 6.6 8.4 Due from CB 213.4 627.6 607.4 Due from other banks 376.3 317.0 210.1 Loan Portfolio (Net) 5,019.8 3.695.1 4 470.2 Interbank loans receivable 77.5 191.5 47.0 Loans and discounts 4,604.2 1,756.4 2206.1 AGRA/AGRI credit loans 253.4 393.7 681.3 Bills purchased 90.7 502.6 770,9 Customer liability on drafts under LC/TR /a 2.7 - - Trading account securities - loans - 874.0 792.0 Less: Allowance for probable losses 8.7 23.1 27.1 Investments 485.3 1,039.9 1 423.2 TrRdTng account securities - investment 7Un 192.3 35 Investment in bonds and other debt instruments 437.4 847.6 1,058.1 Equity investment in allied/nonallied 35.9 - - Other Assets 1.344.4 929.7 1.072.3 Bank preMises/fixtures and equipment 195.3 134E2 Z03.6 Real or other properties owned or acquired 279.9 216.6 264.1 Other assets 869.2 578.9 604.6 Total Assets 7,606.8 6,796.6 8.097.3 Liabilities and Capital jep wsts 3.032.4 5.625.4 6.960.8 Demand and negotiable order of withdrawal b/.1 1U6.9 1T1.7 Savings 1,683.3 3,132.9 4,518.0 Time 1,186.7 2,311.6 2,192.2 Other 95.3 74.0 79.0 Bills Payble 3 435.0 175.5 69.9 c~tent Bank 3:406.6 - n3 Interbank 1.9 75.5 40.0 Local banks 8.0 100.0 - Others 18.5 - - Other Liabilities 498.8 605.0 510.2 Time certificate - special financing TII:rW T97TZ TlY'.V Due to the Treasurer 2.4 0.7 0.8 Due to local banks 0.7 0.2 0.5 Treasurer's/manager's/gift :hecks 18.8 57.9 51.1 Marginal deposito 1.0 - - Accrued taxes ane other expenses 116.0 89.5 81.4 Unearned income a,i other deferred credits 9.3 106.0 100.9 Due to Central Bank 135.5 22.7 2.5 Other liabilities 95.7 165.9 172.1 total Liabilities 6.966.2 6.406.0 7.540.8 Capital 640.6 390.6 556.5 ap5;pital stock 3T5TT 11U5. 47lT Surplus and surplus reserves 167.3 28.1 104.9 Undivided profits 19.9 21.9 22.8 Total Liabilities and Capital 7,606.8 6,796.6 8,097.3 /a LC/TR - letters of credit/trust receipts. Source: CBP. ANNEX 8 PHILIPPINES FINANCIAL SECTOR STUDY Savings and Mortgage Banks' Summarized Consolidated Income Statements, for the Years Ended December 31, 1984-86 (Million pesos) 1984 1985 1986 Total Operating Income 1,100.3 911.0 1,189.6 Interest income J53.2 775.9 972.5 IBL receivable - 5.8 9.5 Loans & discounts 859.8 427.8 471.9 Investments 65.4 292.5 456.7 Deposits in banks 23.6 23.8 34.4 Trading account sec 4.4 3.6 - Others - 22.4 - Bank commissions 1.1 1.2 3.0 Service charges/fees 88.4 31.8 60.6 Trading gain/(loss) (11.7) 62.0 110.8 Foreign exchange profit/(loss) 2.3 1.1 2.0 Income-trust department 3.6 1.4 1.1 Other income 63.4 37.7 39.5 Total Operating Expenses 1,038.6 910.3 1,112.7 Interest expenses 634.8 572.4 610.6 Deposits 561.6 552.9 598.9 Borrowed funds 68.9 19.4 11.7 Others 4.4 0.0 0.0 Compensation/fringe benefits 150.1 129.2 216.1 Management & other professional fees 5.4 1.7 2.5 Supervision & exam fees 1.1 1.8 2.4 Fines, penalties & other charges 4.1 0.2 0.3 Taxes & licenses 22.4 35.2 55.8 Insurance 10.5 5.3 9.5 Depreciation/amortization 27.6 22.6 44.5 Lit/assets acquired expenses 9.9 4.8 6.1 Other expenses 158.8 119.5 156.8 Provisions 13.9 17.5 8.2 Net Operating Income/(Loss) 61.7 0.7 76.9 Extraordinary credits/(charges) 28.4 23.8 41.8 Net Income/(Loss) Before Income Tax 90.1 24.5 118.7 Provision for income tax 22.7 9.9 21.5 Net Income/(Loss) After Income Tax 67.4 14.6 97.2 Source: CBP. ~ 9 - ANNEX 9 PHILIPPINES FINANCIAL SECTOR STUDY Private Development Banks' Summarized Consolidated Balance Sheets. as or December 31. 1¶B4-a6 tmiliion pesos) 1984 1985 1912i Assets Cash and Due From Banks 593.8 802.5 987.3 Cash on hand T R7 1UF7 TlrqrU Check and other cash items 10.7 8.5 19.3 Due from CB 186.6 239.0 285.6 Due from other banks 308.0 448.3 533.5 Loan Portfolio (Net) 2.812.9 2 582.8 2 993.0 Interbank loans receivable 14.Z 29.5 'T10.5 Loans and discounts 2,420.3 2,198.4 2,409.6 AGRA/AGRI credit loans 366.6 393.6 609.8 Bills purchased 2.4 2.6 6.8 Customer liability on drafts under LC/TR /a - 0.4 3.1 Trading account securities - loans 44.5 - - Less: Allowance for probable losses 35.2 41.7 46.9 Investments 395.5 799.3 613.8 Trading account securities - investment - -U77 -W7.T Investment in bonds and other debt instruments 382.1 707.8 550.0 Equity investment in allied/nonallied 13.4 15.2 16.7 Other Assets 704.9 854.0 984.4 Bank premises/fixtures and equipment TIJ3E TT1.T 1RR7S Real and other property owned or acquired 149.3 256.7 342.9 Other assets 449.9 478.2 497.4 Total Assets 4,507.1 5,038.5 5,578.5 Liabilities and Capital Deposits ~ 2.175.8 2.682.9 3,188.2 Deman and negotiable order of withdrawal 1355 T 131.5 413. Savings 948.2 1,264.1 1,607.9 Time 1,030.2 1,259.1 1,330.3 Other 62.1 28.2 36.8 Bills Payable 1 235 5 1,008.3 1,048.7 Deposit substitutes 34.7 - - Others 1,200.7 1,008.3 1,048.7 Central Bank 132.9 14.9 27.1 Interbank - - 150.6 Local banks 366.1 396.7 234.6 Nonbanks 12.0 31.8 1.9 Private firms 25.9 - - Others 663.8 564.9 634.5 Other Liabilities 438.9 613.7 670.9 Time certificate - special financing 4T1U 177.13 2'S Due to the Treasurer 0.3 0.5 5.0 Due to local banks - 0.0 0.1 Treasurer's/manager's/gift checks 38.1 34.4 33.6 Marginal deposits 0.1 - - Accrued taxes and other expenses 112.3 93.8 103.8 Unearned incone and other deferred credits 19.4 28.6 33.8 Due to Central Bank 14.7 7.2 10.6 Other liabilities 212.9 271.4 252.7 Total Liabilities 3,850.1 4,304.9 4,907.8 Ca ital 657.0 733.5 670.7 -t58pEial stock 3n72s 3wr.S 3Mff Surplus and surplus reserves 95.5 '30.9 127.4 Undivided profits 64.9 58.1 (25.7) Total Liabilities and Capital 4,507.1 5.038.5 5,578.5 /a LC/TR - letters of credit/trust receipts. Source: CBP. -10- ANNEX 10 PHILIPPINES FINANCIAL SECTOR STUDY Private Development Banks' Summarized Conbolidated Income Statements, for the Years Ended December 31, 1984-86 (Million pesos) 1984 1985 1986 Total 0perating Income 727.9 884.3 725.0 Interest income 613.7 747.7 629.6 Loans & discounts 529.4 569.0 497.1 Investments 58.2 124.8 88.6 Deposits in banks 23.8 46.1 37.6 Due from CBP 2.4 7.8 6.2 Bank commissions 4.1 2.3 1.6 Service charges/fees 53.9 75.6 28.0 Trading gain/(loss) 1.7 - - Foreign exchange profit/(loss) 1.1 (3.8) 1.2 Other income 53.4 62.6 64.7 Total Operating Expenses 676.5 863.0 774.8 Interest expenses 447.5 544.8 476.5 Deposits 269.0 391.7 305.3 Borrowed funds 171.7 146.7 164.7 Others 6.9 6.3 6.6 Compensation/fringe benefits 96.9 107.2 111.5 Management & other professional fees 4.5 4.8 5.2 Supervision & e-cam fees 0.7 3.1 2.0 Fines, penalties & other charges 2.2 3.7 0.9 Taxes & licenses 8.8 26.8 28.3 Insurance 4.3 5.1 7.1 Depreciation/amortization 16.2 18.9 18.5 Lit/assets acquired expenses 6.8 10.5 17.1 Bad debts expenses - - - Other expenses 83.2 126.7 98.5 Provisions 5.1 11.6 9.2 Net Operating Income/(Loss) 51.4 21.4 (49.8) Extraordinary credits/(charges) 23.4 35.1 28.2 Net Income/(Loss) Before Income Tax 74.8 56.5 (21.6) Provision for income tax 3.7 8.7 7.1 Net Income/(Loss) After Tncome Tax 71.2 47.8 (28.8) Source: CBP. - 11 - ANNEX 11 PHILIPPINES FINANCIAL SECTOR STUDY Stock Savings and Loan Associations' Summarized Consolidated Balance Sheets, as of December 31. 1984-86 (Million pesos) 1984 1985 1986 Assets Cash and Due From Banks 374.1 500.0 673.0 Cash on hand 90.7 113.0 T45.6 Check and other cash items 12.3 14.1 14.3 Due from CB 62.9 117.7 162.8 Due from other banks 208.2 255.2 350.2 Loan Portfolio (Net) 1,761.7 1,635.3 1,937.7 Interbank loans receivable 5.3 - - Loans and discounts 1,390.0 1,340.0 1,597.5 AGRA/AGRI credit loans 350.6 295.4 327.4 Bills purchased 36.1 26.1 45.1 Less: Allowance for probable losses 20.4 26.2 32.3 Investments 247.8 444.6 591.5 Investment in bonds and other debt instruments 162.8 367.9 522.4 Equity investment in allied/nonallied 77.5 1.9 1.3 Others 7.5 74.8 67.8 Other Assets 424.8 543.8 668.8 Bank premises/fixtures and equipment 88.0 89.3 97.0 Real and other property ovned or acquired 82.6 111.7 116.0 Other assets 254.3 342.8 455.8 Total Assets 2,808.4 3,123.7 3.871.1 Liabilities and Capital Deposits 1,734.9 1,974.6 2,624.3 Demand and negotiable order of withdrawal 17.9 18.0 45.3 Savings 989.9 1,077.4 1,502.9 Time 722.5 877.1 1,073.8 Other 4.6 2.2 2.2 Bills Payable 335.4 380.5 376.8 Central Bank 22.9 -1.3 28.2 Local banks - - 200.0 Others 312.5 379.2 148.6 Other Liabil'ties 216.5 270.1 433.1 Time certitIcate - special financing 4.7 3.9 30 Due to the 'Treasurer 7.1 0.0 0.0 Due to local banks 15.9 36.4 0.0 Special time deposits 1.1 0.3 0.1 Accrued taxes and other expenses 58.6 87.0 127.2 Unearned income and other deferred credits 35.7 36.4 42.1 Due to Central Bank 22.1 10.4 40.1 Other liabilities 71.4 95.7 220.6 Total Liabilities 2,286.8 2,625.1 3,434.2 Capital 521.5 498.6 436.9 Capital stock 493.7 516.6 479.2 Surplus and surplus reserves 28.4 31.3 35.3 Undivided profits (0.5) (49.3) (77.7) Total Liabilities and Capital 2,808.4 3,123.7 3,871.1 Source: CBP. -12 - ANNEX 12 PHILIPPINES FINANCIAL SECTOR STUDY Stock Savings and Loan Associations' Summarized Consolidated Income Statements, for the Years Ended December 31, 1984-86 (Million pesos) 1984 1985 1986 Total Operating Income 467.1 514.3 523.9 Interest income 393.9 432.4 441.9 Loans & discounts 335.3 335.7 343.6 Investments 30.2 96.7 98.3 Deposits in banks 28.4 - - Bank commissions 1.5 1.1 0.5 Service charges/fees 33.7 31.0 37.3 Other income 38.1 49.7 44.1 Total Operating Expenses 442.4 513.2 520.2 Interest expenses 250.3 302.1 297.9 Deposits 214.0 257.2 243.1 Borrowed funds 36.3 44.9 54.8 Compensation/fringe benefits 74.1 82.6 87.7 Management & other professional fees 3.7 3.4 4.8 Supervision & exam fees 0.5 1.0 1.3 Fines, penalties & other charges 4.1 3.0 5.1 Taxes & licenses 15.1 17.5 18.5 Insurance 3.7 - Depreciation/amortization 13.1 13.6 17.4 Lit/assets acquired expenses 3.0 - - Bad debts expenses 0.5 - - Other expenses 71.6 90.0 87.5 Provisions 2.5 - - Net Operating Income/(Loss) 24.8 1.1 3.7 Extraordinary credits/(charges) (0.1) (2.6) 2.2 Net Income/(Loss) Before Income Tax 24.7 (1.5) 5.9 Provision for income tax 0.9 2.5 2.5 Net Income/(Loss) After Income Tax 23.8 (3.9) 3.4 Source: CEP. - 13 - ANN 13 PHILIPPINES FINANCIAL SECTOR STUDY Rural Banks' Summarized Consolidated Balance Sheets, as of December 31. 1984-86 (Million pesos) 1984 1985 1986 Assets Cash and Due From Banks 947.6 1,020.4 1,331.2 Cash on hand 228.7 236.3 312.3 Check and other cash items 23.0 21.4 36.7 Due from CB 137.5 162.9 213.5 Due from other banks 558.4 599.8 768.7 Loan Portfolio (Net) 6,818.0 6,416.1 6,543.5 Loans and discounts 982.7 1,080.7 1,318.8 AGRA/AGRI credit loans 6,039.7 5,555.8 5,471.7 Less: Allowance for probable losses 204.5 220.4 247.0 Investments 361.5 436.2 475.9 investment in bonds and other debt instruments 193.3 202.7 215.3 Equity investment in allied/nonallied 19.2 29.4 22.2 Others 149.0 204.2 238.4 Other Assets 691.7 728.6 752.8 Bank premises/fixtures and equipment 149.5 149.1 147.3 Real and other properties owned or acquired 303.8 329.5 368.5 Other assets 238.3 250.1 237.1 Total Assets 8,818.8 8,601.3 9,103.5 Liabilities and Capital Deposits 2,867.2 3.018.7 3,767.1 Demand and negotiable order of withdrawal 17.5 17.1 20.5 Savings 1,910.0 1,966.9 2,407.2 Time 939.6 1,034.7 1,339.4 Bills Payable 3,937.7 3,465.5 3,082.4 Others (Central Bank) 3,937.7 3,465.5 3,082.4 Other Liabilities 708.1 756.6 802.2 Due to the Treasurer 2.6 3.8 3.8 Due to local banks 44.4 52.8 39.9 Unearned income and other deferred credits 241.8 234.0 258.6 Due to Central Bank 38.7 52.4 32.7 Other liabilities 380.6 413.5 467.1 Total Liabilities 7,513.0 7,240.8 7,651.6 Capital 1,305.8 1,360.5 1,451.9 Capital stock 978.0 1,014.9 1,057.5 Surplus and surplus reserves 284.8 291.2 328.4 Undivided profits 43.0 54.4 65.9 Total Liabilities and Capital 8,818.8 8,601.3 9,103.5 Source: CBP. -14 - ARMEX 14 PHILIPPINES FINANCIAL SECTOR STUDY Rural Banks' Summarized Consolidated Income Statements, for the Years Ended December 31, 1984-86 (Million pesos) 1984 1985 1986 Total Operating Income 1,051.9 1,127.7 1,154.9 Interest income 873.2 959.8 966.3 Loans & discounts 788.9 826.6 856.0 Investments 24.5 43.8 39.9 Deposits in banks 59.8 89.4 70.4 Bank commissions 3.6 3.8 4.7 Service charges/fees 103.2 99.2 109.8 Other income 71.9 64.7 74.0 Total Operating Expenses 952.4 1,042.8 1,002.4 Interest expenses 47.1 471.7 467.0 Deposits 326.0 341.5 340.5 Borrowed funds 121.1 130.2 126.4 Co-opensation/fringe benefits 268.9 289.0 286.3 Other expenses 236.4 282.1 249.1 Net Income/(Loss) Before Income Tax 99.4 84.8 152.5 Provision for income tax 0.1 0.1 - Net Income/(Loss) After Income Tax 99.3 84.7 152.5 Source: CBP. - 15 - ANNEx 15 PHrLIPPINES FINANCIAL SECTOR STUDY Specialized Government Banks' Summarized Consolidated lance Seets as or December 31, 1,54-as drillion pesos) 1984 1985 1986 Assets Cash and Due From Banks 2.873.0 3.847.0 3,738 0 Cash on hand -6U '3b.u 73.U Check and other cash items 69.0 56.0 92.0 Due from CB 2,304.0 2,414.0 1,976.0 Due from other banks 440.0 1,321.0 1,59'.0 Loan Portfolio (Net) 40,539.0 33.242.0 11.697.0 lnterbank loana receivable 5u6.0 400.0 Z Loans and discounts 34,160.0 27,884.0 7,657.0 AGRA/AGRI credit loans 5,598.0 5,234.0 4,706.0 Bills purchased 33.0 24.0 20.0 Customer liability on drafts under LC/TR /a 71.0 76.0 76.0 Trading account securities - loans 410.0 220.0 2,100.0 Less: Allowance for probable loeses 239.0 596.0 2,864.0 Investments 13,371.0 12.771.0 6,582.0 Trading account securities - investment -938.0 Z 4 3,438.0 Investment in bonds and other debt instruments 2,933.0 3,678.0 2,014.0 Equity investment in allied/nonallied 9,500.0 6,729.0 1,130.0 Other Assets 24,040.0 35.031.0 3.735.0 U-nk premises/fixtures and equipment 357w 36z.U 304.0 Real and other properties owned or acquired 8,406.0 10,915.0 1,114.0 Customer liability on acceptances outs-anding 8.0 7.0 3.0 Other assets 15,269.0 23,747.0 2,314.0 Total Assets 80,823.0 84,891.0 25,752.0 Liabilities and Capital De osits 5.446.0 6.901.0 8,577.0 Diimand and negotiable order of withdrawal Z18.U 1'55.U -8YW6 Savings 3,891.0 2,971.0 3,740.0 Time 1,052.0 3,480.0 4,327.0 Other 285.0 255.0 321.0 Bills Payable 46,726.0 52.862.0 2.865.0 De-posit substitutes 5UU.0 500.0 - Others 46,226.0 52,362.0 2,866.0 Central Bank 4,349.0 5,432.0 940.0 Interbank - - 156.0 Local banks 2,057.0 - - Nonbanks 488.0 - - Private firms 4.0 - Others 9,:69.0 46,930.0 2,370.0 Foreign 30.159.0 - - Foreign 8,878.0 - - Others 21,281.0 - - Other Liabilities 19.585.0 17,555.0 7,904.0 Time certificate - special financing 5u8.U 533.0 6310 Due to the Treasurer - 1.0 - Due to foreign banks 2,767.0 2,685.0 - Treasurer's/manager's/gift checks 41.0 19.0 21.0 Outstanding acceptances executed by/for 8.0 7.0 3.0 Special time deposits 4,754.0 3,509.0 461.0 Accrued taxes and other expenses 4,407-0 3,942.0 631.0 Unearned income and other deferred credits 952.0 1,437.0 818.0 Payment orders payable - 18.0 12.0 Due to Central Bank 70.0 56.0 50.0 Cash letters of credits 131.0 - - Other liabilities 5,947.0 5,348.0 5,277.0 Total Liabilities 71,757.0 77,318.0 19.847.0 Capital 9 066.0 7 573.0 6 405.0 tIfal stock 6 26u.0 14:e653.U U Surplus and surplus reserves 2,130.0 (4,278.0) (14,907.0) Undivided profits 676.0 (7,802.0) (2,245.0) Total Liabilities and Capital 80,823.0 84,891.0 25,752.0 /a LC/TR - letters of credit/trust receipts. Source: CBP. -16 - ANNE 16 PHILIPPINES FINANCIAL SECTOR STUDY Specialized Government Banks' Summarized Consolidated Income Statements, for the Years Ended December 31, 197M-86 tMlNiion pesos) 1984 1985 1986 Total Operating Income 2 245.6 3,441.0 3,417.0 Interest income Zj783:W 3:iD26W 28rT4.U IBL receivable 79.7 129.0 6.0 Loans & discounts 1,615.5 1,861.0 1,440.0 Investments 151.7 304.0 293.0 Deposits in banks 172.9 224.0 192.0 Due from CBP - - 33.0 Trading account sec 264.0 508.0 647.0 Others - - 73.0 Bank commissions 3.6 3.0 4.0 Service charges/fees 212.7 158.0 102.0 Trading gain/(loss) 8.1 46.0 60.0 Foreign exchange profit/(loss) (811.1) (313.0) 159.0 Income-trust department 8.8 9.0 14.0 Other income 539.8 512.0 394.0 Total Operating Expenses 7,931.5 8,812.0 5 876.0 interest expenses 7,ub.7D 7,697.U 4,613.U Deposits 884.8 892.0 874.0 Borrowed funds 6,180.8 6,694.0 3,633.0 Bonds payable - - 106.0 Others - 111.0 - Finance charges - - 11.0 Compensation/fringe benefits 388.3 435.0 484.0 Management & other professional fees 10.8 15.0 12.0 Supervision & exam fees 13.3 34.0 21.0 Fines, penalties & other charges 2.7 - - Taxes & licenses 21.0 163.0 187.0 Insurance 7.1 11.0 13.0 Depreciation/amortization 37.5 40.0 17.0 Lit/assets acquired expenses 82.2 134.0 76.0 Bad debts expenses - - 6.0 Other expenses 179.5 188.0 175.0 Provisions 123.4 95.0 261.0 Net Operating Income/(Loss) (5,685.8) (5,371.0) (2,459.0) Extraordinary credits/(charges) (602.7) (1,094.0) 181.0 Net Income/(Loss) Before Income Tax (6,288.5) (6,465.0) (2,278.0) Provision for income tax 16.6 14.0 14.0 Net Income/(Loss) After Income Tax (6,305.1 (6,479.0) (2,292.0) Source: CBP. - 17 - PHILIPPINES FIPACIAL SECTON STDY Profile of the Insurance tndustry 1982-86 (#mount$ In ittlion pesosl 1982 3983 1964 1983 3986 Anount " mount I Aount S A19ount _ Lao-nt I8 A. Private Insurer. Life =ieurance Issued. ecelved. Revived I Increased During the Year 22 748.6 100.00 25 932 1 100.00 28 078.7 100.00 34 776.3 100.00 40 238 5 100.00 Ordinary 60.67i 163 03.3 --. 18;854.6 V77F 21T5U2 ;U1 27763 -9 0 Croup 6,477.0 29.47 7.721.2 29.78 7,894.5 28.12 11,064.0 31.b! 11.975.0 29.76 ndutcriel 2,469.7 10.86 1,407.6 5.42 1,329.6 4.73 1,860.2 5.35 500.4 1.24 Insurance Terminated During the Tear 14 443 5 100.00 16 685 0 300.00 16 507.4 300.00 20.556.3 100.00 23 118.0 100.00 OrdInary 7,150.7 -4IW!F 9s6ET: 'WEY2 10'94. -66-.30 3395s6.5 8.36 15,590.5 -75 Group 4 664.0 32.29 5,171.9 31.00 4,428.0 26.82 6,485.1 31.55 6,925.7 29.96 Industrial 2,628.8 18.20 1 8.,.7 11.38 1,135.9 6.88 2,114.7 10.29 601.8 2.60 Insurance in Force at the End of the Year 64.289.7 100.00 74 003.1 100.00 85 579.3 100.00 98 924.4 100.00 316 044.9 100.00 Ordinary 40v047.6 62.29 47J7T1: 637r SE4 ' 64.37 66I702. 2 67.43 7ii174T ,717 Group 19,968.5 31.06 22,979.3 31.05 26,447.7 30.90 30,514.8 30.85 3,5364.1 30.63 Industrial 4.273.6 6.65 3,832.4 5.21 4,046.2 4.73 1,707.4 1.72 1,606.1 1.38 RMbuer of Polictes 3 044 055 100.00 2 973 018 100.00 2 888 813 100.00 2 723 469 100.00 2 703 377 100.00 Ordtnary 1.72.644 *T1T. I,341,077 ' 11W 1435.10 '§ 7T 1T33'229 i1W 1696,567 T&T7i Group 5.337 0.17 5.276 0.18 5,710 0.20 5,131 0.19 9,685 0.36 (Certiftcates) (2,610,108) (2,634,562) (2.924.650) (3,419,611) (3.650,477) Induscrial 1.766.074 58.02 1,626,665 54.72 1,513,117 52.49 13381,109 50.71 997,125 36.88 PreeSu. Income 1 995.4 100.00 1 951.9 100.00 2 190.2 100.00 2 430.9 100.00 2 756.4 100.00 Ordinary t1.1.T 6ri t.7 1 75.r 7702.2 '72,Y 1:897.9 78.0 2,09 -0.10 Croup 505.0 25.31 289.2 14.82 308.2 14.07 360.7 14.84 455.0 16.51 Industrial 209.0 10.47 190.7 9.77 179.8 8.21 172.3 7.09 93.5 3.39 Particpation n Preitu Income 1 995.4 100.00 1951.9 100.00 2190.2 100.00 2.430.9 100.00 2756.4 300.00 Domestic coapanies 2 1 I. 756.1 89.97 1,934.4 88.32 2,08. 86.31 2,32. 85.tl Foreign companies 151.4 7.59 195.8 10.03 253.8 11.68 332.8 13.69 394.0 14.29 Benefit Payments 856.0 100.00 750.3 100.00 946.5 IOO.0( 1.176.0 300.00 1;366.3 300.00 Ordinary 39- 46.16 5 .9 67.29 T21 .2 76.20 770. 65.52 980.7 71T78 Group 384.1 44.87 185.6 24.74 148.3 15.67 302.9 25.76 330.3 24.17 tndustrial 76.8 8.97 59.8 7.97 77.0 8.13 102.6 e.72 55.3 4.05 Benefit Payents 856.0 100.00 750.3 100.0 946.5 100.00 1,176.0 100.00 I1366.3 100.00 Death benefits 207.2 24.21 24T.9 32.64 250.2 26.44 304.4 25.88 361.6 26.7' Matured poltices 61.4 7.17 87.4 11.65 137.6 14.54 155.2 13.20 185.6 33.59 Annuity benefits 1.9 0.22 0.3 0.04 0.4 0.04 0.3 0.02 2.5 0.18 Disability benefits -3. 0.18 1.6 0.21 2.3 0.24 2.3 0.20 3.1 0.23 iurrender beneftst 455.0 53.15 246.4 32.84 323.8 34.21 419.1 35.64 372.6 27.27 Benefits under accident & health policies 37.8 4.42 50.5 6.73 64.0 6.76 83.0 7.06 104.3 7.64 Benefits under supplementary contracts 21.9 2.56 5.8 0.77 38.8 4.10 55.3 4.70 58.4 4.27 Croup conversions 2.0 0.23 0.2 0.03 - - 2.4 0.21 - Policy dividends 62.0 7.24 85.4 11.38 119.9 12.67 134.8 11.46 160.2 11.72 Others 5.3 0.62 27.8 3.71 9.5 1.00 19.2 1.63 118.0 8.63 L8al Reserves 4.547.2 '.167.0 5.794.1 6.394.1 7,176.6 Underwritint Results Prediu. intoue lass increaer/(decrease) in reserves 1,410.4 1,345.5 1.586.4 1,750.7 1,983.7 Benefits paid 856.0 750.3 946.5 1.176.0 1,366.3 Comissiona (net) (400.0) (416.8) (452.0) (473.3) (524.2) Other underwriting incoee/(expense) (63.2) (75.8) (88.8) (117.3) (110.2) Underwriting gain/(lose) 91.2 102.6 99.1 (15.9) (17.0) Underwrtting gain/(loss) as a S of presl Income 4.57 5.26 4.52 (0.64) (0.60) Operating Results Underwriting gain/iloss) 91.2 102.6 99.1 (15.9) (17.0) Cross Invetment incotm 691.7 820.4 1.021.2 1,290.5 1.229,5 Operating expense 501.4 584.4 680.5 870.1 837.4 Not IncomelClose) before Income tax 281.5 338.6 439.8 404.5 375.1 Net IncoeA/(loss) after income tax 205.1 256.5 363.3 325.8 322.0 Inveatment Yield Ia 14.24 13.94 14.40 16.73r 13.57p - 18 - 4u17 3982 1983 1984 1985 198 Mount X Mount X Mnunh X Jaount X Mount X ff0118. 4 Proftsoa lanter 3.1gb. Vritten 4431863.8 457*540.8 5883120.8 661.609.7 149,186.2 Dross reisks 464,809.3 48505S5.9 629,648.6 697.090.6 177,085.0 Met rZoss 308,677.2 315,075.4 4371422.9 49,276.1 565698.0 Premium WVltten Direct business 2,415.5 2,648.2 31117.8 31497.5 3,680.6 Gross premum_ 2,798.6 3,053.9 3.834.2 3,957.9 4,058.2 Net presaius 2,048.2 2,210.1 2,653.2 2,8S4.3 2,936.6 Participation in net preui-m written Domestic cooantie 1,647.4 80.43 13763.8 79.81 2,061.2 77.69 2.148.7 75.28 2,182.9 74.53 Foreign copsatie 4007 19s5T 46.3 20.19 592.0 22.31 705. 24.72 753.1 25.67 Retention ratios 13.19 72.3 3 3.41 72.12 72.36 Reserve for unesrOt.d prmum 1.3 76.2 889.9 976.8 i,043.0 P!Velm EArned heJ4Lin Ptr 2.011.0 100.00 21E52t4 100 00 2.113.5 100.00 2159.3 100.00 2 864.5 100.00 Fire 6 allied lInes 744.6 196.0S3 'II7 T 5.21i7u ,7W W -W1 Marine. aviation or transit 285.2 14.18 291.4 13.54 332.8 13.22 326.5 11.83 324.0 11.31 Caualty 864.1 42.97 931.7 43.29 1.133.0 45.02 13250.2 45.31 1,268.7 44.29 Suretyship 88.5 4.40 96.5 4.48 111.1 4.42 121.1 4.39 131.3 4.59 Life, for profession. relnaurer 28.6 1.42 36.8 1.71 52.0 2.07 57.3 2.08 55.3 3.93 Claim Incurred/Loss Retlos by Line Total 1 034.2 51.43 1,084.9 50.40 1 301.1 51.70 1 387.8 50.29 1.348.2 47.07 nire 4 allted lines 18. 50.87 420.4 SOT 047 4T *497.9 9.'9 6.0 *5 terine. aiation or tranIt 147.8 51.63 154.7 53.08 182.4 54.81 195.7 59.94 154.1 47.56 Csualty 484.3 56.06 486.3 52.19 677.1 59.76 664.1 53.12 665.5 52.46 Suretyship 34.4 16.22 10.1 10.48 12.3 11.02 13.1 10.78 10.9 8.28 Life, for protfoosioal reineurers 8.9 30.89 13.4 36.SO 24.6 47.31 17.0 29.64 18.7 33.76 Undewiting Results Prei. *ned 2,011.0 2,352.4 25316.5 2,759.3 2,864.5 Claim incurred 1,034.2 1,084.9 13301.1 1,387.8 1.368.2 Co_nssinne (net) (479.2) (535.7) (656.2) (706.0) (787.5) Other underwrtcing Incoae/(expense) (120.7) (133.0) (150.6) (166.4) (172.9) Undwritinlg gain/loss) 3176.9 398.9 408.6 499.t 555.9 Underwriting atn/(los) as I to premium earned 18.74 18.53 16.24 18.08 19.41 Operating Results Undertiting &&In/(loss) 376.9 398.9 608.6 499.1 555.9 Gross investment incom 240.t 276.4 398.3 501.4 476.4 Operating expenes 451.3 475.0 505.8 647.2 745.1 eNt Incoee/(loss) before Income tax 165.7 200.3 301.1 353.3 287.2 Met incnm(Inss) ater income tax 130.3 168.5 256.3 290.6 268.0 Investmnt YTeld /s 11.45 10.23 15.86 19.13r 16.13? S. Public Insurers Covernmnt Service Insurance SYStem Investments 10,799.3 12,291.0 13,288.2 14,285.0 15,567 Preiums 2.458.5 2,631.9 2.609.4 2 975.3 3 469 Litf 1348.7 136.7 2.218.6 12.468.8 2712 General Insurance 309.8 315.2 391.0 506.5 7S7 Social Security Svytem Investments 13.430.3 17,S27.0 19,615.7 25,307.0 30,493 Premum 1,900.0 13988.3 2,112.2 2.187.0 2.221 Phi1lipine Cro. Insurance mnvemonts 316.5 328.2 313.2 348.4 504 Premium 32.4 42.8 47.2 "'-i 76 r - Revised f"gurea; p - preliminary figures. a Using;: investment yield - 21 S 100 wheret I - investment intert/incoee earned for the current year A - investmnts at cost of the previous year 8 - investment at cost of current year. Sourcet Ray Data Insurance Industry (1962-86). Insurance Comiseion. - 19 - ANNEX 18 PHILIPPINES FINANCIAL SECTOR STUDY The Social Security System (Thousand pesos) Assets Trust funds Investments Amount Increase Amount increase Amount increase Social Security 1957-59 105,804 227.05 104,487 233.42 100,393 233.40 1960-69 4,982,182 10.32 4,664,702 30.30 4,364,228 30.10 1970-79 31,866,181 21.50 41,256,926 21.42 41,855,743 21.80 1980 8,220,682 21.78 8,112,809 22.15 8,066,327 22.06 1981 9,958,235 21.14 9,823,211 21.08 9,711,305 20.39 1982 11,834,004 18.84 11,707,250 19.18 11,538,464 18.81 1983 13,936,600 17.77 13,796,095 17.84 13,633,164 18.15 1984 17,155,919 23.10 16,805,204 21.81 16,448,990 20.65 1985 22,245,772 29.67 21,709,855 29.19 21,121,516 28.41 1qR6 26,155,109 17.57 25,868,082 19.15 25,290,680 19.74 Medicare 1972-79 1,131,'81 24.04 1,091,955 24.69 1,093,212 25.07 1980 357,270 48.16 355,325 52.48 350,146 52.02 1981 511,344 43.13 508,487 43.10 501,392 43.20 1982 668,358 30.71 666,358 31.05 652,825 30.20 1983 853,674 27.73 851,773 27.83 838,473 28.44 1984 1,137,158 33.21 1,135,521 33.31 1,105,369 31.83 1985 1,577,242 38.70 1,561,222 37.49 1,492,024 34.98 1986 1,964,228 24.54 1,944,235 24.53 1,898,924 27.27 Employees' Com- pensation 1975-79 1,333,666 71.37 1,294,702 72.11 1,286.929 70.64 1980 682,255 34.43 680,557 35.84 668,664 36.59 1981 892,481 30.81 889,397 30.69 873,486 30.63 1982 1,143,562 28.13 1,141,662 28.36 1,117,010 27.88 1983 1,436,871 25.65 1,435,025 25.70 1,408,488 26.09 1984 1,822,693 26.85 1,820,037 26.83 1,742,274 23.70 1985 2,478,471 35.98 2,475,283 36.00 2,349,782 34.87 1986 3,069,409 23.84 3,067,761 23.94 2,982,593 26.93 Source: SSS. - 20 - ANNEX 19 PHILIPPINES FINANCIAL SECTOR STUDY The Government Service Insurance Szstem: Corporate Balance Sheet, 1985/86 Increase 1986 1985 (decrease) Assets Current assets 3,253,367,065 1,789,542,495 1,463,824,572 Loans and investments 12,746,646,915 11,857,728,189 888,918,726 Other assets 3,326,197,888 3,105,620,181 220,577,707 Total Assets 19.326,211,868 16,752,890,866 2,573,321,002 Add: Nonadmitted assets 116,608,321 120,034,501 (3,426,180) Total Assets 19,442,820,189 16,872,925,367 2,569,894,822 Less: Nonadmitted assets 116,608,321 120,034,501 (3,426,180) Total Admitted Assets 19,326.211,868 16,752,890,866 2,573,321,002 Liabilities and Net Worth Current liabilities 1,725,900,752 950,411,758 775,488,994 Deferred credits 48,360,715 55,731,750 7,371,035 Reserves Social insurance reserve fund 16,430,733,779 13,327,366,965 3,103,366,814 Optional insurance reserve f_..d 489,713,682 534,493,000 (44,779,318) Medicare i4surance reserve fund 174,368,443 240,230,000 (65,861,557) Employees' compensation insurance reserve fund 307,490,073 446,365,935 (138,875,862) General insurance reserve fund 711,645,913 676,829,352 34,816,561 Total Reserves 18,113,951,890 15,225,285,252 2.888,666,638 Surplus (562,001,489) 521,462,106 (1,083,463,595) Total Liabilities and Net Worth 19,326,211,868 16,752,890,866 2,573,321.002 Source: GSIS. PHILIPPINES FINANCIAL SECTOR STUDY Ranking and Selected Balance Sheet Accounts of Individual Banks as of September 30. 1987 (p'O00) Total assets Liquid assets Tota. Loans Total deposits Bank borrowings Capital accounts Rank Amount Rank Amount Rank Amount Rank Amount Rank Amount Rank Amount Private Domestic Banks Allied Banking Corp. 13 6,205,553 14 1,899,680 11 3,454,672 13 4,042,610 27 198,049 9 903,717 Associated Bank 28 2,345,336 27 657,478 26 1,221,550 22 1,641,269 21 398,020 30 143,408 Bank of the Philippine Islands 3 20,073,412 3 9.303,664 4 8,212,898 2 16,579,368 20 450,746 5 1,558,004 China Banking Corp. 18 4,458,820 20 1,086,400 17 2,434,314 14 3,415,398 28 104,632 13 542,704 CityTrust Banking Corp. 11 6,602,719 10 2,975,167 15 2,692,509 15 3,403,712 8 1,272,086 10 871,917 Commercial Bank of Manila 29 1,662,630 30 324,478 30 788,372 29 711,386 22 367,965 20 376,594 Consolidated Bank & Trust Corp. 12 6,263,893 11 2,347,333 12 3,382,530 9 4,908,691 24 337,858 15 519,195 Equitable Banking Corp. 14 6,165,675 13 2,300,548 14 3,231,256 10 4,764,380 23 351,417 11 665,983 Far East Bank & Trust Co. 4 18,118,295 4 8,054,769 5 7,975,925 3 13,406,072 7 1,316,398 4 1,617,118 International Corporate Bank 20 3,654,624 17 1,397,028 19 1,975,772 24 1,376,400 14 792,124 8 943,050 Manila Banking Corp. - 0 - 0 - 0 - 0 - 0 - 0 Metropolitan Bank & Trust Co. 5 17,089,723 6 6,047,320 3 8,910,062 4 12,859,622 3 2,047,569 7 1,069,735 Philippine Bank of Communications 24 3,138,975 23 968,234 21 1,844,217 23 1,623,406 13 826,860 16 481,061 Philippine Banking Corp. 21 3,403,460 25 813,285 23 1,692,202 17 2,817,662 26 205,992 25 256,845 Philippine Commercial Int'l Bank 6 13,987,997 7 4,932,385 6 7,139,825 5 10,353,187 12 837,635 6 1,290,657 Philippine Trust Co. 26 2,888,051 16 1,483,515 27 1,041,692 19 2,232,902 29 51,395 21 366,661 Pilipinas Bank 30 1,513,107 28 513,150 29 807,592 30 588,402 19 462,565 24 292,344 Producers Bank of the Philippines 27 2,641,388 26 701,072 28 981,980 27 1,098,794 10 1,045,843 28 151,409 Prudential Bank 15 6,028,336 8 3,492,164 24 1,648,569 12 4,410,832 15 727,917 14 530,140 Republic Planters Bank 16 5,636,269 24 850,835 13 3,298,415 25 1,342,206 2 2,150,827 17 479,993 Rizal Commercial Banking Corp. to 6,797,168 19 1,136,347 10 3,808,790 11 4,664,693 17 595,135 12 594,476 Security Bank 6 Trust Co. 19 4,258,226 12 2,304,071 25 1,398,458 16 3,347,105 25 217,807 23 340,976 Traders Royal Bank 23 3,288,939 21 1,018,310 20 1,870,348 18 2,468,173 30 48,348 22 354,865 Union Bank of the Philippines 22 3,327,877 18 1,265,822 22 1,833,567 20 1,714,831 11 873,358 18 442,570 United Coconut Planters Bank 9 11,173,511 9 3,483,968 7 5,989,966 7 5,851,847 6 1,334,163 3 2,143,668 Subtotal 160.723.984 59.357,021 77,635,481 109,622,948 17,014,709 16,937,110 Foreign Banks B a rica 8 11,928,862 15 1,679,593 8 5,567,561 21 1,708,999 18 464,534 27 157,204 Citibank N.A. 2 25,382,272 2 9,313,602 2 9,508,899 6 6,319,854 1 7,467,739 29 150,238 Hongkong & Shanghai Banking Corp. 17 4,500,827 22 985,394 16 2,660,857 26 1,168,737 9 1,156,806 26 188,735 Standard Chartered Bank 25 3,075,310 29 404,910 18 2,090,135 28 915,672 4 1,498,886 19 401,318 Subtotal 44,887,271 12,383,499 19,827,452 10.113.262 10.587,965 897,495 Government Banks Land Bank ot the Philippines 7 13,101,835 5 6,049,730 9 5,460,619 8 5,202,214 16 670,926 1 3,837,011 Philippine National Bank 1 32,727,257 1 14,489,234 1 10,536,501 ' 19,434,621 5 1,416,914 2 3,140.656 Subtotal 45,829,092 20,538.964 15,997.120 24,636,835 2.087,e40 6.9,7.667 GRAND TOTAL 251,440.347 92,279,484 113,460.053 144,373,045 29.690,514 24.812,272 Source: Published Statements of Condition, as given in Business World, Special Report, November 10, 1987. PHILIPPINES FINANCIAL SECTOR STUDY Commercial Banks' Summarized Consolidated Balance Sheets, as of December 31. 1970. 1975. 1980-86 (Million pesos) 1970 1975 1980 1981 1982 1983 1984 1985 1986 Assets Cash 294.0 872.2 2,077.3 2,102.8 2,140.2 2,897.1 2,908.9 3,335.2 4,918.3 Check and other cash items 351.4 1,172.7 1,184.2 1,106.8 912.5 987.2 1,150.0 1,045.2 1,154.6 Due from CB 841.3 2,222.8 7,058.7 9,109.9 8,654.7 15,815.0 29,230.6 32,946.1 35,775.0 Due from banks 508.6 5,016.5 11,357.8 12,143.4 16,283.4 11,842.0 21,869.3 23,602.6 20,942.2 Loans and discounts 7,583.8 26,070.0 77,439.2 90,529.1 104,417.8 139,373.7 134,115.7 124,406.2 93,665.2 Customers' liability for bank's acceptances outstanding 1,621.9 6,538.8 11,172.3 12,439.8 11,970.6 15,516.4 13.638.7 10,012.0 8,376.0 Investment in bonds and securities 1,762.3 6,180.0 13,453.1 16,205.9 20,225.8 21,443.5 29,678.4 27,753.4 30,587.4 Bank premises, furniture and equipment 305.6 940.4 3,046.7 4,080.8 4,654.8 5,236.3 6,749.1 8,563.2 6,156.6 Real and chattel properties 215.0 412.8 1,052.0 1,339.0 2,117.5 2,967.1 3,879.6 il,820.6 4,786.8 Others 582.2 3,746.6 10,575.8 15,557.1 19,600.1 31,849.9 45,930.6 39,862.0 42,164.4 Total 14,066.1 53.172.8 138,417.1 164,614.6 190,977.4 247,92A.2 289,150.9 283,347.1 248.526.5 Liabilities and Net Worth Liabillties Demand deposits 2,458.9 6,664.8 12,792.0 14,311.7 11,939.4 19,139.3 15,268.0 14,753.3 19,650.6 Savings deposits 3,757.2 8,951.2 23,047.1 27,016.7 33,444.7 40,939.7 47,210.9 56,267.5 70,881.2 Time deposits 1,469.6 5,130.7 36,791.1 37,933.3 47,846.3 56,147.8 72,068.4 71,996.9 47,494.4 Due to banks 511.5 2,426.1 820.0 1,555.9 1,628.6 2,006.3 982.7 2,409.7 2,181.4 Treasurer's and manager's checks 144.7 289.6 1,417.3 1,482.5 1,424.9 1,730.6 2,059.2 2,368.5 1,779.6 Dividends payable .. .. 49.0 40.3 63.2 308.5 230.5 77.3 41.7 Bills payable 1,948.7 18,209.5 32,833.2 44,788.9 47,482.6 66,164.8 65,126.3 68,544.1 29,433.2 Other liabilities 2,304.8 6,125.4 19,959.6 23,436.1 30,418.4 41,519.0 61,546.5 45,353.0 48,828.5 Subtotal 12.595.4 47.997.3 127,709.3 150,565.4 174,248.1 227,956.2 264,492.5 261,770.3 220,290.6 Net Worth Capital stock 867.9 3,866.9 6,659.0 8,413.2 10,248.7 12,062.8 13,232.2 15,109.3 12,979.0 Surplus reserve and undivided profits 602.8 1,308.6 4,048.8 5,636.0 6,480.6 7,909.2 11,426.2 6,467.5 15,256.9 Subtotal 1,470.7 5,175.5 10,707.8 14,049.2 16,729.3 19,972.0 24.658.4 21.576.8 28.235.9 Total 14,066.1 53.172.8 138,417.1 164,614.6 190.977.4 247,928.2 289,150.9 283,347.1 248,526.5 Source: CBP. PHILIPPINES FINANCIAL SECTOR STUDY Commercial Banks' Su-mmrized Consolidated Income Statements, for the Years ended December 31. 1970. 1975. 1980-86 ~Million pe teYersoedDcmbr3s190 97,18 1970 1975 1980 1981 1982 1983 1984 1985 1986 Total MratinR Income 1.168.7 4 766.9 14 263 2 20 506.1 24.360.8 28,862.7 39 035.5 36 124.2 28 200.8 Interest ncome 79Z.I 3,304.6 11,470.3 117955.7 ZU,541.3 Z3,044.3 30,700.4 29,0ZZ.6 X-,864.6 Interbank loans receivable - - 2,875.0 808.3 1,324.4 1,126.1 904.9 532.2 n.a. Loans and discounts 711.5 2,868.5 8,823.6 12,057.6 14,376.7 !4.845.7 23,289.4 19,015.9 n.a: Investments 80.6 436.1 1,207.2 1,240.9 1,368.7 2,n13.9 2,724.0 2,214.6 nI. Deposits in banks - - 1,033.9 2,856.2 3,400.5 2,944.7 3,361.3 3,589.2 n.S. Due from CBP - - - - - - - 918.1 n.a. Trading account securities - - 118.1 92.7 7 0 !13.9 420.8 2,235.8 n.a. Others - - - - - - - 436.8 n.a. Bank commissions - - 605.5 636.0 549.1 605.7 930.4 771.0 723.3 Service charges/fees 110.1 597.7 814.4 772.7 578.8 556.3 882.2 602.0 620.5 Fees/commissions - others - - - - - - - 133.8 75.9 Trading gain/(loss) - - 187.8 106.8 184.7 187.4 651.2 1,701.2 1,279.3 Foreign exchange profit/(loss) 164.0 430.4 761.4 1,254.5 1,796.5 3,645.4 4,817.7 2,659.8 2,547.7 Gold trading gain/(loss) - - 4.0 - 22.4 (1.9) 4.8 7.7 0.5 Income-trust department 12.1 35.8 151.7 230.7 213.7 198.3 231.1 421.0 427.6 Other income 90.4 398.4 268.1 449.7 474.3 627.2 817.4 805.1 661.4 Total OperatIn8 Expenses 949.0 3 667.1 12 819.2 18 972.9 22 871.1 26 711.7 37 914.7 40 880.1 31 370.9 Interest expenses ZT97 7W907 tZE Z 90.7 8 83 Z 139Z.Z 17194.4 17'.Zl,7 ZYY . Z9 fZ9.3 Z0:3J9 Deposits 286.8 992.1 4,434.0 7,206.9 9,006.0 10,892.7 13,740.4 16,730.0 n.e. Borrowed funds 129.5 1,298.6 4,254.6 6,548.1 7,943.4 8,159.4 13,205.6 11,705.0 n.e. Others - - 147.6 347.2 245.0 355.4 1,052.2 1,388.3 n.a. Finance charges - - - - - - - - 1.5 Compensation/fringe benefits 144.1 514.8 1,446.7 1,834.6 2,045.6 2,324.9 2,749.1 2,927.5 3,245.9 W Management and other professional fees - - 72.7 82.4 83.6 116.5 156.9 169.7 192.7 Supervision and examination fees - - 53.2 79.4 79.4 62.3 4.8 76.6 84.6 Fines, penalties and other charges - - 6.9 6.4 52.2 23.6 330.6 282.5 458.5 Taxes and licenses 124.7 223.7 695.1 715.1 749.6 881.0 1,229.5 1,809.0 1,101.7 Insurance - - 74.2 97.9 104.6 130.9 148.1 191.4 209.0 Depreciation/amortization 26.8 61.0 214.8 273.6 318.3 374.3 448.3 535.1 540.0 Litigation/assets acquired expenses - - 26.8 1.0 70.3 77.5 110.6 127.2 124.0 Bad debts expenses - - 67.2 131.4 130.7 150.3 583.6 596,3 39.0 Other expenses 237.1 576.9 1,198.1 1,950.3 1,780.9 2,170.1 2,648.1 2,953.1 3,039.6 Provisions - - 127.3 358.6 261.5 992.8 1,506.9 1,382.4 1,939.1 Net Operating Income/(Loss) 219.7 1,099.8 1,444.0 1,533.2 1.489.7 2.151.0 1,120.8 (4.755.9) (3,170.1) Extraordinary Credits/(Char8es) (14.6) (41.0) 159.3 125.2 207.5 169.4 241.3 393.1 537.8 Recovery on charged-off assets _ -1 -TU :7 -vwr -7:7 -4T'rn 117J.Ir Income from assets acquired - - 16.6 23.2 54.9 50.1 57.0 90.1 109.1 Profits/(losses) from assets sold/exchanged - 12.7 64.8 45.2 90.8 127.2 102.4 74.0 136.9 Dividends-equity Investments - - - - - - 109.7 5.0 Revaluation profits/(losses) - (28.7) _ _ _ _ _ (13.8) 10.9 Profits/(losses) on foreign exchange swap contract differential - - - - - - - 75.9 45.6 Others (14.6) (21.1) 69.9 46.1 52.2 (15.1) 61.6 16.2 190.6 Net Income/(Loss) Before Income Tax 205.1 1,058.8 1.603.3 1,658.4 1,697.2 2,320.4 1,362.1 (4.362.8) (2.638.3) Provision for income tax - 282.9 112.4 142.2 80.6 155.7 228.4 279.8 307.7 Net Income/(Loss) After Income Tax 205.1 775.9 1,490.9 1.516.2 1.616.6 2.164.7 1,133.7 (4.642.6) (2.946.0) Source: CBP. - 24 - ANNEX 23 PHILIPPINES FINANCIAL SECTOR STUDY Analysis of Commercial Banks' Sources and Uses of Funds. 1980-86 (Amounts in billion pesos) 1980 1981 1982 1983 1984 1985 1986 1987 Jun Nominal Sources and Uses of Funds Sources 138.4 164.6 191.0 247.9 289.2 283.3 248.5 253.8 Deposits 72.6 79.3 93.2 116.2 134.5 143.0 138.0 138.6 Capital 10.7 14.0 16.7 20.0 24.7 21.6 28.2 27.6 Loans/bills 32.8 44.8 47.5 66.2 65.1 68.5 29.4 32.6 Due to banks 0.8 1.6 1.6 2.0 1.0 2.4 2.2 1.4 Unclassified 21.4 25.0 31.9 43.6 63.8 47.8 50.7 53.7 Uses 138.4 164.6 191.0 247.9 289.2 283.3 248.5 253.8 Cash 3.3 3.2 3.1 3.9 4.1 4.4 6.1 5.1 Private loans 81.5 96.6 108.3 143.0 124.2 116.Z 91.0 96.8 Private Investment 1.9 3.6 5.1 5.0 9.4 8.6 7.4 13.3 Total private 83.4 100.1 113.3 148.0 133.5 124.8 98.4 110.1 Government loans 7.1 6.4 8.1 11.9 23.6 18.2 11.1 11.8 Government Investment 11.5 12.6 15.2 16.5 20.3 19.2 23.2 18.8 Total govervment 18.6 19.0 23.3 28.3 43.9 37.4 34.3 30.6 Due from banks 18.4 21.3 24.9 27.7 51.1 56.5 56.7 59.2 Unclassified 14.7 21.0 26.4 40.1 56.6 60.2 53.1 48.9 Constant 1980 Pesos Sources 138.4 150.7 153.8 100.3 96.2 92.6 77.1 76.8 Deposits 72.6 72.6 75.1 47.0 44.8 46.7 42.8 41.9 Capital 10.7 12.9 13.5 8.1 8.2 7.0 8.8 8.3 Loans/bills 32.8 41.0 38.2 26.8 21.7 22.4 9.1 9.9 Due to banks 0.8 1.4 1.3 0.8 0.3 0.8 0.7 0.4 Unclassified 21.4 22.9 25.7 17.6 21.2 15.6 15.7 16.2 Uses 138.4 150.7 153.8 100.3 96.2 92.6 77.1 76.8 Cash 3.3 2.9 2.5 1.6 1.4 1.4 1.9 1.5 Private loans 81.5 88.4 87.2 57.8 41.3 38.0 28.2 29.3 Private investment 1.9 3.3 4.1 2.0 3.1 2.8 2.3 4.0 Total private 83.4 91.7 91.3 59.9 44.4 40.8 30.5 33.3 Government loans 7.1 5.9 6.5 4.8 7.8 6.0 3.4 3.6 Government Investment 11.5 11.5 12.2 6.7 6.8 6.3 7.2 5.7 Total government 18.6 17.4 18.8 11.5 14.6 12.2 10.6 9.3 Due from banks 18.4 19.5 20.1 11.2 17.0 18.5 17.6 17.9 Unclassified 14.7 19.2 21.2 16.2 18.8 19.7 16.5 14.8 Key Perfpmnce Ratios L sits 122.0 129.9 124.8 133.3 109.8 94.0 73.9 78.4 Loans/fund liabilities 83.4 82.0 81.8 84.0 73.6 62.8 60.2 62.9 Capital/total assets 7.7 8.5 8.8 8.1 8.5 7.6 11.4 10.9 Capital/loans 12.1 13.6 14.4 12.9 16.7 16.1 27.7 25.4 Real Growth Rates (2) Total sources and uses 8.9 2.1 (34.8) (4.1) (3.8) (16.7) (0.4) Deposits (0.1) 3.5 (37.4) (4.8) 4.4 (8.3) (2.1) Capital 20.1 4.8 (40.1) 1.6 (14.1) 24.3 (4.9) Loans/bills 24.9 (6.7) (30.0) (19.0) 3.4 (59.2) 8.1 Due to banks 73.7 (7.9) (38.2) (59.7) 140.7 (14.0) (37.5) Unclassified 6.7 12.5 (31.5) 20.6 (26.5) 0.7 3.3 Cash (9.9) (16.3) (36.1) (14.0) 6.0 31.7 (18.8) Private loans 8.5 (1.4' (33.7) (28.6) (8.1) (25.6) 3.7 Private investment 68.9 23.9 (50.5) 54.4 (9.8) (18.5) 76.1 Total private 9.9 (0.4) (34.4) (25.8) (8.2) (25.1) 9.2 Government loans (17.8) 11.5 (26.7) 63.4 (24.1) (42.4) 4.3 Government investment 0.4 5.8 (45.5) 1.6 (7.4) 15.1 (21.0) Total government (6.6) 7.7 (38.9) 27.5 (16.4) (12.9) (12.9) Due from banks 5.7 3.2 (44.3) 52.0 8.7 (4.7) 1.7 Unclassified 30.9 10.6 (23.8) 16.2 4.6 (16.3) (10.3) Source: Basic data by CBP. - 25 - ANNEX 24 PHILIPPINES _INANCIAL SECTOR STUDY Performance Ratios of the Cosmercial Banking Svstem 1984 1985 1986 Financtal Performance (S) Return on risk assets 0.58 (2.98) (2.30) Return on assets 0.36 (1.66) (1.25) Return on equity 2.88 (16.14) (9.99) Licuidity (2) Normal fsk assets/core deposits 111.19 88.52 69.33 All risk assets/core deposits 133.68 108.06 91.36 Capital Adeay (2) Equity/normal risk assets 24.36 22.54 30.30 Equity/all risk assets 20.27 18.46 22.99 Equity/all RA plus truat 18.42 15.95 18.38 Equity/total assets 12.42 10.31 12.51 Equity/core deposits 27.09 19.95 21.01 Equity/funding liabilities 17.74 14.08 17.09 Growth Indicators (2) Change in normal risk Assets - (12.05) (23.33) Change in all risk 4ssets _ (10.69) (17.24) Change in total assets - (1.92) (15.11) Change ia equity participations - (17.43) (35.06) Change in core deposits 10.48 (2.12) Change in trust funds 40.85 31.70 Change in equity - (18.64) 3.07 Productivity Staiffexpenses/core deposits 1.93 2.03 2.30 Staff expenses/all risk assets 1.44 1.88 2.51 Staff expenses/net income 247.03 (63.06) (109.53) Intermediation Margin, 2 Total Assets Staff costs 0.88 1.05 1.37 Administrative costs 1.24 1.36 1.73 Depreciation & provisions 0.67 0.90 1.07 Total Costs 2.79 3.31 4.17 Profit before all taxes 0.82 (0.92) (0.65) Intermediation Margin 3.62 2.40 3.52 Dividends/Payout Rate 629.4/61.9 248.7/(5.4) 664.2/(22.4) Past Due Data (Pesos) Renegotiated 2,524.1 4,743.8 2,904.6 1- 30 days 2,475.8 3,363.1 2,235.3 31- 90 days 1,940.0 1,623.9 1,430.2 91-180 days 1,094.1 1,466.3 985.4 181-360 days 1,879.4 2,600.9 1,797.3 Over I year 5,995.7 6,324.3 13,348.3 Total 15,909.2 20,122.2 22,701.1 Potential Loss Estimates (Pesos) 2 Renegotiated 25 631.0 1,185.9 726.2 1-30 days 5 123.8 168.2 111.8 31-90 days 10 194.0 162.4 143.0 91-180 days 25 273.5 366.6 246.3 181-360 days 50 939.7 1,300.4 898.7 Over 1 year 75 4,496.8 4,743.2 10,011.2 Specific reserve estimate - 6,658.8 7,926.7 12,137.2 General Reserve estimate 1 1,321.9 1,132.3 822.1 Total 7,980.7 9,059.0 12.959.3 Reported loan loss provisions (Pesos) 3,027.9 5,754.6 7,088.9 Adjusted equity (Pesos) 30,392.9 25,453.1 23,769.1 Equity/normal risk assets (Z) 20.95 19.95 24.30 Equity/total assets (2) 10.68 9.12 10.04 Sources: Loan loss provisions have been derived from individual bank's published annual reports; all other data from CBP. Calculations of ratios are by the mission. - 26 - umuC 25 P IL7FPlGS FiNANCiAL SECTOR STOUDT Consolidated 5lalance Sheets of th Comrcial Bakin toee F (Aounotesn 1millfon pesos) 1984 2 1985 S 1986 S Total As5stt 197.289.9 100 202,853.0 100 201,824.7 100 Cash and Due From Senks 46.511.3 24 37.148.? 28 56.511.3 28 Cash on hand 2,607.0 1 3,118.3 2 4,218.6 2 Checl and other cash item 274.5 0 431.8 0 511.9 0 Due from CB 21,973.1 11 28,619.0 14 27,888.3 14 Due from other bonks 21,656.7 11 24,979.6 12 23,892.6 12 Loan Portfolio (Not) 97.045.4 49 92 277.7 45 89 154.1 4 Incerb Uk lons rteelvable 2,193.7 1 3,278.0 7 3,014.3 T Loans aud discounts 70,892.1 36 63,558.2 31 60,027.0 30 ARA/AGRI credit loans 10,571.9 5 11,554.0 6 12,077.0 6 6ill purch ed 4,948.8 3 3,994.0 2 4,782.9 2 Custo_er's liabilLty on drafts under LC/TR /s 4,962.8 3 4,390.1 2 6,035.1 3 Trading account *scurities - loans 3,476.3 2 5,503.5 3 3,217.8 2 7nvestmento 23 031.9 12 22 234.0 11 26.421.1 13 Trading account securities - inveoatmmt 6,668.7 1 8,997.0 4 11,597.9 T investmnt In bonds and other debt Inatruments 13,332.7 7 10,933.2 5 12,599.7 6 gquity lvstment In allitd/nonsllIed 3,030.4 2 2,303.8 1 2,223.5 1 Other Assets 30 701.3 16 31 192.3 15 29.738.2 15 Bank premises/fixturos and quipment 4*43 2 5;533.7 3 5,462.8 3 Real and other properties owed or sequtred 2,439.9 1 2,955.6 1 3,629.0 2 Customer's liability on acceptance outstandilg 3,303.8 2 3,311.6 2 1,848.4 1 Other aesets 20,713.2 10 19,391.6 10 18,798.C 9 Total Liabilities and Capital Accounts 197,289.9 100 202,853.0 1O0 201,824.7 I0 Deoesits 110 315.5 56 120 681.4 59 118.440.5 59 Demand and negotiable order of withdraval ;743. -T 9164.Z -T 11,018.7 T Savings 38,029.8 19 49,181.4 24 64,928.0 32 Time 58,774.8 30 62,335.8 31 42,493.8 21 Others 4,767.0 2 0.0 0 0.0 0 Bill. Ph,able 25 695.2 13 22 650.9 11 28 423.6 14 Deposit substitutes 5,635.2 * 4,000.9 T1 4ti.8 7 Others 20.060.0 10 18,650.0 9 24,278.7 12 Cantral Bank 6,463.6 3 8,660.8 A 7,440.9 4 fnterbank 1,162.9 1 2,674.0 1 10,899.4 5 Local bhnks 206.5 0 51.4 0 24.7 0 Monbanke 286.1 0 0.0 0 0.0 0 Private firs 455.5 0 0.0 0 0.0 0 Others 599.0 0 7,263.8 4 5,913.8 3 Foreign 10,886.4 6 0.0 0 0.0 0 Forogn 10,309.6 5 0.0 0 0.0 0 Others 376.8 0 0.0 0 0.0 0 Other Liabilities 32.869.4 17 32.016.9 16 27.860.6 14 Tim certificate - special fliacLng 431T 'F 780.9 7 F 590.1 "5 Special foreign currency dpepoits G.5 0 19.7 0 72.3 0 Due to the Traeurer 12.2 0 20.5 0 20.5 0 Due to local banks 61.6 0 355.6 0 197.4 0 De to foreign bhok 1,504.2 1 120.4 0 369.3 0 Traasurar'./manager's gift chock 1,690.8 1 2,066,3 1 1,492.3 1 Outstanding ecceptancee *ecuted by/for 3,218.7 2 3,328.7 2 1,890.2 1 Marginal deposits 3,110.9 2 2,230.4 1 2,765.9 1 Special tim deposits 37.0 0 55.2 0 88.4 0 Accrued ctrse and other exeues 3,593.6 2 2,848.1 1 2,397.6 1 Unarned lncom and other deferred credits 1,096.0 1 1,149.7 1 1,150.5 1 Fsymnt orders payable 503.8 0 339.5 0 504.4 0 Wue to Central Bank 1,659.0 1 4,879.4 2 4,108.8 2 Cash letters of predits 289.9 - 2,057.1 - 1,408.8 - Other liabtlties 15,652.9 8 11,765.5 6 10,804.2 5 Total Liabilities 168.880.0 86 175.349.2 86 174,724.7 87 Total CaDital Accounts 28.409.9 14 27 503.8 14 27.100.0 13 Capital stock 9,220.1 1 9 3 tO0227.1 5 Surplus end surplus rserevee 2,434.8 1 3,302.1 2 *,243.1 2 Undivided proftts 2,313.1 1 2,426.5 1 2,218.9 1 Do. from had office. etc. 6,646.8 3 6,439.1 3 8,007.6 4 Due to head office, etc. 20,393.0 10 17,877.6 9 17,503.4 9 Asigned capital 695.7 0 723.4 0 897.4 0 Revaluation profite/(loeses) 0.0 0 46.2 0 17.7 0 Trust accounts 15,979.2 - 23,455.7 - 31,111.4 - la LC/TR * letters of credit/trust recipts. Sourcest Consolldated Baea Sheet of ell 30 banks provided by CUP. Adjusent toe m La by the daesovn. - 27 - ANNEX 26 PHILIPPINES FINANCIAL SECTOR STUDY Consolidated Income Statements of the Commercial Banking System Less PNB, 1984-86 (Amounts in miliron p-esosT 1984 1985 19R6 Total Operating Income 27.405.5 30.917.5 24.158.1 Interest income 21,201.7 24,383.9 17,966.9 Interest-interbank loans receivable 2,414.5 352.9 257.7 Interest-loans and discounts 14,372.2 15,796.0 11,552.7 Interest-investmenta 1,927.0 2.C54.5 1,752.9 Interest-deposit in banks 2,067.2 2,511.1 1 354.4 Interest-due from C6P 0.0 918.1 1:354.7 Interest-trading account securities 420.9 2,235.7 1,348.6 Interest-others 0.0 435.6 345.9 Bank commissiona 624.0 634.5 609,0 Service charges/fees 568.0 567.3 592.2 Fees/commissions-others 0.0 133.7 75.8 Trading gain/tloss) 675.1 1,872.5 1,278.5 Foreign exchange profit/(loss) 3,422.5 2,315.7 2,628.7 Gold trading gain/ (loss) 2.9 8.5 0.5 Income-trust department 215.5 411.9 415.9 Other income 695.7 729.5 590.7 Total Operating Expenses 24 728.7 28 491.0 21 796 1 =nterest expenses 17:463.1 19 lZ5.8 1 z Interest-deposits 10,530.3 13,428.2 9,080.1 Interest-borrowed funds 6,219.7 4,341.4 3,209.5 Interest-bonds payable Interest-others 713.2 1,356.3 831.3 Finance charges 0.0 0.0 1.5 Compensation/fringe benefits 2,093.5 2,490.4 2.790.0 Management and other professional fees 100.0 115.2 140.4 Supervision and examinetion fees (12.9) 59.6 61.6 Fines, penalties and other charges 64.0 26.1 27.3 Taxes and licenses 1,008.5 1,638.0 995.6 Insurance 129.1 171.9 186.2 Depreciation/amortization 371.5 489.6 506.2 Litigation/assets acquired expenses 73.0 84.4 84.0 Bad debts expenses 1,189.5 581.5 37.4 Other expenses 2,168.5 2,593.3 2,662.7 Provisions /a 80.9 1,115.3 1,182.3 Net Operating Income/(Loss) 2.676.8 2.486.5 2.362.0 Extraordinary credits/(charges) (389.5) 363.8 475.9 Net Income/(Loss) Before income Tax 2.287.3 2,850.3 2.837.9 Provision for income tax 168.6 275.4 304.0 Net Income/(Loss) After Income Tax 2,118.7 2,574.9 2,533.9 Restatement of Profit and Loss 1984 2 1985 2 1986 X Interest income 21,201.7 100 24,303.9 100 17,966.9 100 Interest expense 17,463.1 82 19,125.8 79 13,122,4 73 Net Interest Difference Income 3,738.6 40 5,178.1 47 4,844.6 46 Fee income 1,192.0 13 1,335.5 12 1,277.0 12 Foreign exchange income 3,422.5 37 2,315.7 21 2,628.7 25 Trading income 678.0 7 1 881.0 17 1,279.0 12 Trust income 215.5 2 411,9 4 415.9 4 Net Operating Income 9.246.7 100 11,122.3 100 10,445.0 100 Staffing 2,093.5 23 2,490.4 22 2,790.0 27 Depreciation 371.5 4 489 6 4 506 2 5 Taxes and licenses 1,008.5 11 1,638.0 15 995.6 10 Other operating expenses 2,521.7 27 3,050.5 27 3,162.2 30 Net Operating Expenses 5.995.2 65 7,668.5 69 7,454.0 71 Net Operating Profit 3,251.4 35 3,453.7 31 2,991.0 29 Other income 695.7 8 1,093,3 10 1,066.6 10 Loan loss provisions 1,270.4 14 1,696 7 15 1,219.7 12 Other expenses 389.5 4 0.0 0 0.0 0 Net Income Before Tax 2.287.3 25 2.850.3 26 2,837.9 27 Taxes 168.6 2 275.4 2 304.0 3 Net Income After Tax 2.118.7 23 2,574.9 23 2,533.9 24 Net income before all tax 3,295.9 4,488.3 3,833.4 Taxes 1,177.1 1,913.4 1,299.6 Effective :vx rate excluding reserve costs 35.7 42,6 33,9 /a Excluding provision for income tax. Source: Consolidated Income Statement of a,l 30 banks provided by CBP. Adjustment for PNB is by the mission. - 28 - ANNEX 27 PHILIPPINES FINANCIAL SECTOR STUDY Performance Ratios of the Comercial Banking System Lees PNB. 1984-86 1984 1985 1986 Financial Performance (2) Return on risk assets 1.76 2.25 2.19 Return on assets 1.07 1.27 1.26 Return on equity 7.46 9.36 9.35 Liquidity (t) Normal risk assets/core deposits 87.97 76.46 75.27 All risk assets/core deposits 108.85 94.89 97.58 Capital dequacy (Z) Equity/normal risk assets 29.27 29.81 30.40 Equity/all risk assets 23.66 24.02 23.45 Equity/all risk assets plus trust 20.88 19.94 18.47 Equity/total assets 14.40 13.56 13.43 Equity/core deposits 25.75 22.79 22.88 Equity/funding liabilities 20.89 19.19 18.45 Growth Indicators (2) Change in normal risk assets - (4.91) (3.39) Change in all risk assets - (4.63) 0.93 Change in total assets ^ 2.82 (0.51) Change in equity participations - (23.98) (3.49) Change in core deposits - 9.40 (1.86) Change in trust funds - 46.79 32.64 Change in equity - (3.19) (1.47) Productivity Staff expenses/core deposits 1.90 2.06 2.36 Staff expenses/all risk assets 1.74 2.17 2.41 Staff expenses/net income 98.81 96.72 110.11 Intermediation Margin. 2 Total Assets Staff costs 1.06 1.23 1.38 Administrative costs 1.48 1.50 1.57 Depreciation & provisions 0.83 1.08 0.86 Total Costs 3.37 3.81 3.80 Profit before all taxes 1.67 2.21 1.90 Intermediation Margin 5.04 6.02 5.70 Dividends/Payout Rate 640.0/30.2 248.7/9.7 664.2/26.2 Past Due Data (Pesos) Renegotiated 1,246.3 3,931.9 2.435.2 1- 30 days 2,475.8 3,363.1 1,375.1 31- 90 days 1,940.0 1,623.9 882.1 91-180 days 1,094.1 1,466.3 604.8 181-360 days 1,879.4 2,600.9 1,104.6 Over I year 5,995.7 6,324.3 8,217.8 Total 14,631.3 19,310.4 14,619.7 Potential Loss Estimates (Pesos) 2 Renegotiated 25 311.6 983.0 608.8 1- 30 days 5 123.8 168.2 68,8 31- 90 days 10 194.0 162.4 88.2 91-180 days 25 273.5 366.6 151.2 181-360 days 50 939.7 1,300.4 552.3 Over 1 year 75 4,496.8 4,743.2 6,163.4 Specific reserve estimate - 6,339.4 7,723.7 7,632.6 General reserve estimate 1 849.6 762.7 782.4 Total 7.188.9 8.486.5 8.415.1 Reported loan loss provision4 (Pesos) 2,542.3 3,303.7 3,709.4 Adjusted equity (Pesos) 23,763.3 22,321.1 22,394.4 Equity/normal risk assets (2) 24.49 24.19 25.12 Equity/total assets (X) 12.04 11.00 11.10 Sources: Loan loss provisions have been derived from individual bank's published annual reports; all other dats from CBP. Calculations of ratios are by the mission. - 29 - ANNEX 28 PHILIPPINES FINANCIAL SECTOR STUDY Analysis of Deposit Structure of Commercial Banks 1980 1981 1982 1983 1984 1985 1986 Distribution of Deposits Demand 12.8 14.3 11.9 19.1 15.3 14.8 19.7 Savings 23.0 27.0 33.4 40.9 47.2 56.3 70.9 Time 36.8 37.9 47.8 56.1 72.1 72.0 47.5 Core deposits 72.6 79.2 93.1 116.1 134.6 143.1 138.1 Z Distribution of Deposit Sources Demand 8.8 9.0 6.4 8.2 5.2 4.7 6.3 Savings 15.8 17.0 17.9 17.6 16.0 17 4 22.6 Time 25.3 23.9 25.7 24.2 33.2 32.4 27.0 Deposit Substitutes Demand n.a. n.a. n.a. n.a. 8.3 6.2 4.9 Savings n.a. n.a. n.a. n.a. 17.5 24.5 32.3 Time 72.6 79.2 93.1 116.1 160.4 173.8 175.3 Constant Peso Funding (1980) Demand 12.8 13.1 9.6 7.7 5.1 4.8 6.1 Savings 23.0 24.7 26.9 16.5 15.7 18.4 22.0 Time 36.8 34.7 38.5 22.7 24.0 23.5 14.7 Core deposits 72.6 72.5 75.0 46.9 44.8 46.8 42.9 Deposit substitutes 0.0 0.0 0.0 0.0 2.8 2.0 1.5 Trust 0.0 0.0 0.0 0.0 5.8 8.0 10.0 Total 145.2 145.0 150.0 93.9 98.1 103.6 97.3 Source: Basic data by the CBP. - 30 ANNEX 29 PHILIPPINES FINANCIAL SECTOR STUDY Distribution of Outstanding Loans by Purpose, 1980-86 (Billion pesos) 1980 1981 1982 1983 1984 1985 1986 Loans Oustanding by Purpose Production 45.3 44.2 50.8 48.6 51.8 33.6 30.5 Trade 11.2 15.6 16.6 15.5 20.3 14.1 10.3 Construction 2.3 3.0 5.0 3.8 5.2 2.4 1.9 Consumption 1.4 1.7 1.7 2.5 2.3 2.2 1.9 Other 17.0 22.0 24.2 41.0 36.8 35.3 22.0 Total 77.2 86.5 98.2 111.4 116.4 87.6 67.6 In 1980 Pesos Production 45.3 40.5 40.9 19.7 17.2 11.0 9.8 Trade 11.2 14.2 13.4 6.2 6.7 4.6 3.2 Construction 2.3 2.8 4.0 1.5 1.7 0.8 0.6 Consumption 1.4 1.6 1.4 1.0 0.8 0.7 0.6 Other 17.0 20.1 19.5 16.6 12.2 11.5 6.8 Total 77.2 79.2 79.1 45.0 38.7 28.6 21.0 h Composition Production 58.7 51.1 51.7 43.7 44.5 38.4 46.6 Trade 14.5 18.0 16.9 13.9 17.4 16.1 15.3 Construction 2.9 3.5 5.0 3.4 4.5 2.7 2.7 Consumption 1.8 2.0 1.7 2.2 2.0 2.6 2.8 Other 22.0 25.4 24.7 36.8 31.6 40.3 32.6 Source: Basic data was provided by the CBP.z 31 - ANNEX 30 PHILIPPINES FINANCIAL SECTOR STUDY Distribution of Outstanding Loans by Security (Billion pesos) 1980 1981 1982 1983 1984 1985 1986 Cotzposition of Loans Outstand- inp by Security Unsecured 28.7 31.5 33.0 30.5 39.0 26.8 27.4 Real estate 23.2 25.3 29.7 35.4 30.2 23.2 18.6 Chattel 4.2 6.7 9.5 11.9 12.3 5.0 3.1 Assignment 6.1 6.0 7.9 8.6 6.4 6.3 6.0 Other 14.9 17.0 18.2 24.9 28.5 26.3 11.5 Total 77.2 86.5 98.2 111.4 116.4 87.6 66.6 2 Distribution Unsecured 37.2 36.4 33.5 27.4 33.5 30.6 41.1 Real estate 30.1 29.3 30.2 31.8 25.9 26.5 28.1 Chattel 5.4 7.7 9.7 10.6 10.6 5.7 4.6 Assignment 7.9 7.0 8.1 7.7 5.5 7.2 9.0 Other 19.3 19.7 18.5 22.4 24.5 30.0 17.2 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Z secured 62.8 63.6 66.5 72.6 66.5 69.4 58.9 In 1980 Pesos Unsecured 28.7 28.8 26.5 12.3 13.0 8.8 8.5 Real estate 23.2 23.2 23.9 14.3 10.0 7.6 5.8 Chattel 4.2 6.1 7.7 4.8 4.1 1.6 1.0 Assignment 6.1 5.5 6.4 3.5 2.1 2.1 1.9 Other 14.9 15.6 14.6 10.1 9.5 8.6 3.6 Total 77.2 79.2 79.1 45.0 38.7 28.6 20.7 Source: Basic data was provided by the CBP. - 32 - ANEX 31 PHILIPPINES FINANCIAL SECTOR STUDY Distribution of Outstanding Loans by Maturity 1980 1981 1982 1983 1984 1985 1986 Distribution of Loan Maturities 0-1 year 60.3 63.5 67.8 77.2 71.0 58.1 47.1 1-3 years 7.7 15.0 17.8 16.9 28.2 14.7 10.0 3-5 years 9.1 8.0 12.7 17.3 17.2 14.8 9.5 Total 77.2 86.5 98.2 111.4 116.4 87.6 66.6 Z Distribution of Loan Maturities 0-1 year 78.1 73.4 69.0 69.3 61.0 66.3 70.6 1-3 years 10.0 i7.3 18.1 15.1 24.3 16.7 15.0 3-5 years 11.9 9.3 12.9 15.5 14.8 16.9 14.4 Source: Basic data was provided by the CBP. -33- PHILIPPINES FINANCIAL SECTOR STUDY Coerciul Bank Branches by baton, 1976-86 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 Manila 429 486 513 573 619 729 776 842 859 784 800 Other Region 1 76 81 88 94 99 111 116 112 112 102 100 2 23 24 26 30 30 36 36 37 37 35 36 3 100 105 109 118 121 135 141 143 145 137 139 4 89 88 94 101 106 117 120 124 125 111 113 5 35 38 44 47 50 55 57 56 56 48 49 6 81 89 91 97 99 110 117 119 118 109 108 7 66 72 83 89 100 113 117 120 119 112 111 8 23 26 27 29 31 35 37 37 37 .3 33 9 19 21 24 26 31 39 42 40 40 36 36 i ,'43 47 55 59 59 69 70 69 69 63 64 61 67 68 78 83 95 100 102 102 88 86 18 18 17 17 22 28 30 30 31 28 28 Subtotal 634 676 726 785 831 943 983 989 991 902 903 Total 1,063 1,142 1,239 1,358 1.450 1.672 1.759 1.83 1.X50 1.686 1,703 Source: Basic date was provided by the CDP. - 34 - ANNEX 33 PHILIPPINES FINANCIAL SECTOR STUDY Analysis of the Cost of Intermediation, 1983-86 1983 1984 1985 1986 Average net paid to depositor (P) 8.02 10.42 8.77 5.86 20% final tax (Z) 2.00 2.60 2.19 1.46 Average cost of deposits (%) 10.02 13.02 10.96 7.32 Reserves (blended 21% & 5%) (%) 18.00 18.00 18.00 18.e0 Agra (%) 10.00 10.00 10.00 10.00 Reserve earnings @ 4% less 20% FT (f) 3.20 3.20 3.20 3.20 Reserve earnings credit (%) 0.90 0.90 0.90 0.90 Cost of deposits (X) 9.12 12.12 10.06 6.42 v of deposits available for lending 72.00 72.00 72.00 72.00 Cost of lendable funds (X) 12.67 16.84 13.98 8;92 Effective reserve costs (X) 2.65 3.82 3.02 1.60 Average bank lending rate (2) 15.01 19.73 18.84 14.62 Gross receipts rate (X) 5.00 5.00 5.00 5.00 GRT margin effect (Z) 0.75 0.99 0.94 0.73 Bank received (2) 14.26 18.74 17.90 13.89 Total margin (2) 6.99 9.31 10.07 8.76 Taxation component (2) 5.41 7.41 6.15 3.80 Bank margin (X) 1.59 1.90 3.92 4.97 Composition of Lending Rate (X) Depositor 53.40 52.79 46.54 40.05 20% final tax 13.35 13.20 11.63 10.01 Reserve costs 17.67 19.36 16.02 10.96 Gross receipt tax 5.00 5.00 5.00 5.00 Bank margin 10.57 9.65 20.81 33.97 Total 100.00 100.00 100.00 100.00 Intermediation Margin (Z) 20% final tax 2.00 2.60 2.19 1.46 Reserve costs 2.65 3.82 3.02 1.60 Gross receipt tax 0.75 0.99 0.94 0.73 Bank margin 1.59 1.90 3.92 4.97 Total 6.99 9.31 10.07 8.76 Thrift bank margin (2) 3.13 4.12 5.67 5.90 Thrift advantage (2) 1.54 2.22 1.75 0.93 Source: Mission calculations based on basic data provided by the CBP. - 35 - 411334 PHTLIPPINES PINANCIAL SECTOR STUDY Coemcial lanka: Analv;ie of Arrears. Decetber 31. 1986 Renego- X AdLt ated tiated Number of da v!at due Total past equity/ lank ID loans 1-30 31-90 91-180 181-360 >360 past due due loans /a As 98 .2 11.8 29.7 141.7 200.8 290.2 772.4 11.8 12 SC 138.9 22.9 18.3 18.6 24.4 454.9 678.0 53.5 5 CD 5.5 45.4 25.7 15.7 48.1 209.6 350.0 24.5 22 DE 1.S 15.9 2.5 4.5 8.7 46.3 79.4 1.2 is GP /c n.a. n.a. n.a. n.a. n.a. n.e. n.e. n.a. n.a. 22.6 3.4 23.7 35.0 5.9 72.9 163.5 14.2 72 CH °0.0 0.8 0.0 4.4 0.0 94.5 99.7 3.9 52 HI 203.7 9.1 7.9 5.2 55.4 71.0 352.4 5.6 32 1IJ 0.0 20.6 11.7 11.7 95.7 139.9 279.6 14.9 31 .K 51.7 19.6 16.5 15.0 36.3 449.4 58C.4 24.1 3 KL 21.1 7.8 16.9 15.6 21.5 56.8 139.8 16.5 39 TM 16.7 21.5 0.0 9.7 0.5 30.3 80.7 5.1 61 MN 740.8 985.2 324.8 15.0 107.2 1579.5 3,752.6 39.8 27 NO 113.7 35.4 24.0 64.1 47.4 432.8 717.3 34.2 17 OP /c n.a. n.a. n.a. n.a. n.a. n.a. 0.0 n.a. 28 pQ 0.0 18.2 0.6 0.0 2.7 106.9 128.3 2.6 28 QR Jb 8.2 6.1 0.0 5.6 20.1 765.8 805.7 73.0 (31) Rs 178.6 0.3 1.1 6.5 51.1 454.3 691.9 21.6 24 t;T 7.3 0.7 101.2 50.4 6.6 198.4 364.6 7.1 41 TU lb 72.0 63.2 76.9 4.2 12.1 137.5 366.0 19.3 20 UV 0.0 0.0 0.0 0.0 84.8 673.8 758.5 41.6 (9) W 0.0 0.0 1.2 48.7 0.0 7.5 57.4 3.6 4 in 22.8 4.4 7.0 66.7 198.0 140.0 438,9 36.9 26 XY 59.5 21.3 29.0 25.9 3.3 277.9 416.8 13.9 39 TZ 615.4 3.5 100.9 26.0 31.2 207.9 984.7 28.3 2 ZA° 9.7 26.3 24.6 10.5 24.7 131.7 227.4 14.1 23 AA 5.5 31.9 37.3 2.7 1.4 634.1 712.9 79.5 (28) BBU/b 4.4 0.0 0.5 1.5 17.1 474.0 497.7 55.6 0 CC 35.4 0.7 0.0 0.0 0.2 79.8 116.2 13.n 28 CD 469.5 0.0 0.0 0.0 0.0 0.0 469.5 4.1 50 Total 2.904.6 1.376.0 882.1 604.8 1.105.1 8.217.8 15.090.4 15.9 27 Potential for lose (1) 25 5 10 25 50 75 General Renego- Number of dav -at due_ Potential Reported Under- Reported Adjusted lan 1k riDal6d tiated 1-30 31-90 910 181-36 0 loes reserves reserves equity equtty AB 56.0 24.5 0.6 3.0 35.4 100.4 217.7 439.5 153.1 286.4 1.091.7 805.3 SC 5.9 34.7 1.1 1.8 4.7 12.2 341.2 401.6 185.8 215.9 285.0 69.1 CD 10.8 1.4 2.3 2.6 3.9 24.1 157.2 202.2 88.9 113.3 426.5 313.2 DE 67.4 0.4 0.8 0.2 1.1 4.4 34.7 109.0 267.3 (158.3) 894.8 1.053.1 EF /c n.a. n.a. n.e. n.. n:,. ne na. ne n.e. 671.9 671.9 FG /b 9.9 5.7 0.2 2.4 8.7 3.0 54.7 84.5 n.e. 84.5 908.3 823.8 GH 24.9 0.0 0.0 0.0 1.1 0.0 70.9 96.9 n.e. 96.9 1,449.7 1.352.8 HI 58.9 50.9 0.5 0.8 1.3 27.7 53.3 193.3 733.4 (540.1) 1,454.0 1,994.1 1J 15.9 0.0 1.0 1.2 2.9 47.8 104.9 173.8 148.4 25.4 603.4 578.0 JK 18.6 12.9 1.0 1.6 3.7 18.1 337.0 393.0 n.r. 393.0 469.8 76.8 ItL 7.1 5.3 0.4 1.7 3.9 10.8 42.6 71.7 29.8 41.9 369.0 327.1 Lt 15.0 4.7 1.1 0.0 2.4 0.3 22.7 46.2 198.4 (152.2) 811.4 963.6 MN 56.8 185.2 49.3 32.5 3.8 53.6 1,184.6 1,565.7 n.e. 1,565.7 4,086.7 2,521.0 NO 13.8 28.4 1.8 2.4 16.0 23.7 324.6 410.7 209.9 200.8 558.7 357.9 OP /c 73.9 0.0 0.0 0.0 0.0 0.0 0.0 73.9 774.4 (700.5) 1,402.9 2.103.4 PQ 48.7 0.0 0.9 0.1 0.0 1.3 80.2 131.1 n.e. 131.1 1,529.1 1,398.0 QR lb 3.0 2.1 0.3 0.0 1.4 10.0 574.3 591.1 n.e. '91.1 245.7 (345.4) RS 25.2 44.7 0.0 0.1 1.6 25.5 340.7 437.8 333.8 104.0 860.9 756.9 ST 48.0 1.8 0.0 10.1 12.6 3.3 148.8 224.7 155.1 69.6 2,192.9 2,123.8 TU /b 15.4 18.0 3.2 7.7 1.0 6.1 103.2 154.5 90.4 64.1 448.6 384.5 UV 10.6 0.0 0.0 0.0 0.0 42.4 505.3 558.3 46.0 512.3 347.5 (164.8) VWI 15.3 0.0 0.0 0.1 12.2 0.0 5.6 33.3 n.e. 33.3 93.7 60.4 wx 7.5 5.7 0.2 0.7 16.7 99.0 105.0 234.8 186.1 48.7 362.0 313.3 XY 25.9 14.9 1.1 2.9 6.5 1.7 208.4 261.2 860.9 (599.7) 558.5 1,158.2 YZ /b 24.9 153.9 0.2 10.1 6.5 15.6 155.9 367.0 n.e. 367.0 449.2 82.2 ZA 13.9 2.4 1.3 2.5 2.6 12.3 98.8 133.8 n.r. 133.8 499.4 365.6 MA 1.8 1.4 1.6 3.7 0.7 0.7 475.6 485.5 n.e. 485.5 235.7 (249.8) BB /b 4.0 1.1 0.0 0.1 0.4 8.6 355.5 369.6 83.6 286.0 288.6 2.6 CC 7.8 8.9 0.0 0.0 0.0 0.1 59.9 76.6 9.0 67.6 321.4 253.8 O DD 110.1 117.4 0.0 0.0 0.0 0.0 0.0 227.5 3,379.4 (3,151.9) 2.539.5 5,691.4 |Ttot1 798.7 726.2 68.8 88.2 151.2 552.5 6,163.4 8.549.0 7.933.6 615.4 26.456.5 25,841.1 1a Adjusted equity is calcvlated in the lest column of the second part of the annex. P Private banks undergo!ng rehabilitation. /c Data not available One percent of performing loant outstanding. PHILIPPINES FINANCIAL SECTOR STUDY Government-Supervised/Directed Credits: Agriculture Year Irplementing Nsoe of program Fund sources Major objectives Implemented agency Lending channel. Agrtculture Credits - Locally Funded Nasagan 9 /a (-991_ Dept. of Agriculture 6 Fish- To Increase productivity and attain self- 1973 DA/NAFC PNB, RUs, LBP eries/National Pood 6 Agri- sufficiency In rice. culture Council (DA,/AFC) Cooperative Development Dept. of Agriculture 6 Fish- To foster growth of cooperatives and 1973 CDLFI DA CRBs Loan Fund ta (CDLF) eries/Bureau of Cooperative strengthen cooperative movement financIng Development (DAF/BCD) assistance. Pagkain ng Bayan /a (for- Ninistry of t'nance To contribute to food production. generate Palayan-1973 Pagkain ng Bayan, Direct lending to merly Palayan ng Sayan) additional revenues for provincial/city Pagkain-1980 IDF, UFA. DA, MAR. provincial/city gov- governments and provide addtional employ- BAEcon ern ent ment opportunities. Cotton Financing Program/a Philippine Cotton Corpora- To Increase local production of cotton. 1974 PCC, CB SRm (CFP) tion (PCC) CB-NECS Supervised Experi- Department of Education and To increase food production through train- 1974 CB. NECS Ras ence Program Culture tug of agricultural students on effective use of credit. Gulayan sa launlaran /a DA/NAFC To contribute to food supply by increasing 1975 DA/NAFC UBs (GSE) vegetable production end conaequently pro- vide farmers with additional source of income. IAF-Virgtnia/Burley DA/NAFC To met groving agricultural credit needs 1975- CB, PiTA RBs Tobacco Financing la of tobacco farmers of Virginia and Burley. Virginia 1980-Burley Philippine Tobacco Author- DA/NAFC To improve produetion of high-quality 1975 PTA PTA ity (PTA) Credit Assis- native cigar leaf tobacco by providing tance for Native Tobaccota production loans and factlitating loans. Farm Systems Development DA/NAFC Construction of pump/lcomnal Irrigation 1975-79 FSX Integrated Service Corporation (PSDC) Irriga- projects mainly for crop production; to Associations (TSA) tion System/Infrastructure develop and control water on a small-scale o Development (FSDC-ISIO) multipurpose scheme througb construction of small impounding projects. Year Implementing Iame of progrm Fond sources Major objectives Implemented agency Lending cbhnmle FSDC Adaptive Fare tech- DAtN1AFC Provision of farn macineries or carobeos. 1976-80 PSDC ISAS nology Developments Sakahang Barangay /a DAtNAFC To provide additional Income for sall 1977 Co. BAT RBs (Pattening) beckyard cattle raisers. Special Agriculture Reba- DAR To provide special financing to ineligible 1978 CB. DA/NAWC RSa PNB bilitation Fund (SARF) farmers in areas affected by natural cela- wties. Kamblngag Bsrangay /s DA/NAFC To Improve income of small farmers throupg 1979 CB, AI Res provision of financing for goat produc- tlan. Biyayang Dagat Program /a Fishertes loan and Guarantee To encourage and asslat small- and sedi,- 1979 BrAP RBs. PNB. DBP (BDP) Fund scale fisberman and culture fishery oper- ators in increastng production and adopt- Ing appropriate flshing technology. FSDC KISA-Agro-Industries DA/NAFC with assistance frm To assist ISA/farmer embers In establish- 1981/82 FSDC FSDC, KAISA the German governt Ing and mnaging livestock centers, feed- sill projects/enterprisesa rice Integrated cooperative enterprises and trading proj- ects. Supervised Credit for DA/RAPC To increase local production of various 1982 CB/BPI Rbs Orchard Crops /a fruits. FSDC Gasifter/Wnodlot DA/NAPC To promote use of gasifier equipment to 198? FSDC ISAs Project ensure economic operation of the irriga- tion system, to establish a small-scale free farming unit to supply wood fuel needs of gasifier-run Irrigation systems. flgong Kilusang Kabuhayen To spur economic and social development 1982 B-KU Secretariat, FNB, DBFP LBP at Kanlaran (B-K) through establiabuent of livelihood proj- BPAR ects or enterprises to be onewd and managed by comwAnities. Kalabaw ng Baraga /a D/UAWC To fianmce parchase of carsbao stocks for 1983 CB BAI RBs draft breeding and other expenses related to procurement of animls to be financed. nlil' g if ,r if [qj 5sl 1 E F E f i I Ii ii L Si g | | § § } W E g 3 | { i{ wrXi -~1. 4 ; ;V ; 3 'i @~ P11'* r~~~~~~~~ Year Implementing _r of program Fund sources Major objectives implemented agency lending channels qoedan IRPi/CP Financing DAI-MC 1987 to Farnera through Trad- ere/Millers Agri-S_ll and Mediu. To infuse financial resources to country- DIP A-SMILE DUP Industries tending Progrm side development in order to accelerate (ASMILE) growth of agricultural and small- and edium-scale industries. griculture Credits - Foreign Assested Leguan de Day Piabpsn Asian Development Dank To develop around 1.680 ha of fish modules 1979 LLDA/DSP DBP Development Project (ADD)/Organiation of Petro- In laguna de Day to beneftt about 155 lei Exporting Countries lakeshore fmiltes. (OPEC) Samehang MEayn Support United States Aid for Inter- To develop and pilot test a viable and 1979 DAP. BCOD ED NFD Es RFs, PUB Project (SNSP) national Development (USAID) realistic package of support service tech- nology that will provide SNs direct and Indirect socioeconomic benefits to farmer- member beneficilaries of agrarian reform. Cooperattwe Mbrketing USAID To develop efficient and well-managed 1979 BCOD IBso NFA cu. RBs. NFDA, CP o Project (RIP) cooperative finance system to cater to * needs of Area Marketing Cooperatiwes (ANtCs); strengtben and facilitate develop- ment of the cooperattve marketing struc- ture in the Philippines. Northern Palawan Fisheries ADP To develop area-specific production and 1980 PFDA PFDA Development Project marketing-ortented investment project In fishertes. Palavwn Integrated Area ADD To provide an Integrated package of credit 1981 NACIAD-DA. PIADP. RBs DOP Develoapnt Project for developaent of land under sultistorey CD (PIADP) cropping; improvement of land cultivated under coffee, cashew and cattle fatteniag. > National Food Autbority hFA/ADI To modernize about 350 cane mdlls to 1981 APMP office (lFA) Direct lending (MPA) Agro-Processing and improve their ability to sll UFA paddy 0 Marketing Project (APi?) through the provision of credit assistance for Private Sector MIodera- covertng up to 805 of total cost of ization Scbeee approved modernization plans. Year lplewenting lle of progrm Fund sourcea Najor objectives tmpleuented agency Lending channels IFA-APl for Thresher NFA/ADS To strenghthen WFAs graIn center in 1983 APIP office (NFA) Direct leoding Amortization Progrm Csgayan Valley by providing adequate threshing. drying. storage and transporta- tion facilities. Agro-ladustrial Technology Overseas Economic Coopera- to Increase productivity and Improve ar- 1981 TLRC-DBP TLRC Transfer Program (AITTr) tion Fund (OECF) ket competttiveness of Philippine agribus- iness through transfer of technology. developnt of domestic and export mrkets end livelihood generation for the rural sector. First Agusculture Develop- ADB To increase .llkfish and shrimp production 1984 DA. BFAR. CD Rll, Kis, TOe ment Project of existing fishponds through rehabilita- tion and Improvement of good management practices. TSal Lake Developmnt Pro- wie To assist mall-scale fishermen along Taal 1984 FSDC TSLDP FSDC gram (TLDP) Lake. Laguna Lake Cooperative IB To provide livelihood projects for lake- 1984 PSOC LLDA PSDC, LLDA Development Program shore residents along Laguna Lake. (IIGDP) Agricultural Loan Fund CSAID/k7B To provide short-, medi,u- and and long- 1985 CB-DLC Accredited banks Project (ALF) term credit for agriculture projects. to develop an appropriate institutional and policy frmework for a financially sound banking system; and to strengthen capacity of rural savings and to improve efficiency of farm credit operattons. Ariculture Guarantee Programs - Locally Funded Quedan Financing Program National Food Authority To encourage active participation of food 1978 QGFB Aceredited PKB., for Food Traders/Proces- (NFA)/Quedan Coarantee Fund businessmen In local procurement of Rli, ScGs o sora Drd (WCFB) grains; increase direct tnvolvement of private comercial banks in compliance with PD 717; enhance further rice stabili- natton program of government and support Its food production program. Year Implement1ng Name of program Fund sources Major objectives implemented agency Lending channels Guarantee Fund for Small GFSME To induce banking Institutions to support 1984 CFStE Accredited banks and Medium Enterprises la small and medium enterprises by directly (GFSME) lending their own funds to finance agri- business projects of entrepreneurs through a system of guarantee Interest rates sub- sidy, liquidity and refinancing scbemes. Quedan Financing Program NFAIQGFB To provide farmers opportunity to maximize 1985 QGFB Quedan traders/ for Farmers their earnings through proper and timely millers disposition and sale of thetr produce. Quedan Financing Program NFA/QGFB To encourage private banks to extend mar- 1986 QGFB. SRA PBs for Sugar keting credit to sugar planters, millers, traders and end-users and promote use of sugar quedan as collateral. Aariculture Cuarantee Program - Foreign Funded USAID Guarantee Facility USAID To stimulate rural business sector through USAID PCIB, FEBTC, financing of borrowers whose principal Metrobank place of operation is outside Metro Itanilm. /a Consolidated under the CALF. Note: Acronyms used: Agriculture Credit Policy Council (ACPC), Bank of Philippine Islandq (BPI).. Bureau of Antial Industry (BAI), Bureau of Cooperative Development (UIOD). Central Blank - Department of Loans and Credits (CB-DLC), Commercial Banks (BBs), Cooperative Rural Banks (CRBs), Development Bank of the Phtlippines (DBP), Far East Bank end { Trust Co. (FEBTC), Laguna Lake Development Authority (LLDA), Land Blank of the Phtlippines (LBP), National Economic Development Authority (NEDA), National Food Authority (NFA), Phtlippine Comercial International Bank (PCI8), Philippine Fisheries Development Authority (PFDA), Philippine National Bank (PNB), Rural Banks (RBs), Specialtzed Governrent fanks (SC8s), Technology Livelihood and Iesource Center (TLRC) and Thrift Banks (TBs). 0 I - 42 - ANEX 36 PHILIPPINES FINANCIAL SECTOR STUDY Ftnancial Performance,of Selected Cr;dtt Proar _ bY Tear Nam of program 1900 1981 1982 1983 1984 1985 1986 1987Lea 'Loni granted lb 5,484.5 4,872.4 5,300.0 5,476.7 5,741.8 5,775.9 5,715.9 5,716.0 Loans collecteaTb 3,583.2 3,857.7 4,240.4 4,441.7 4,628.4 n.a. 4,799.2 4,814.2 Loans outstarding n.&. 1,014.7 1t059.8 1,029.2 1,113.4 n.a. 916.7 901.3 Loans pe t due n.e. 870.6 901.3 923.6 982.8 n.s. 468.0 438.2 Past due ratio (2) n.a. 85.8 85.8 89.7 88.3 n.a. 51.0 49.0 Pa tin n Bayan /c on wgRrancea n.e. 17.1 20.7 21.7 n.e. n.m. 20.1 49.1 Loans collectei/b n.a. 5.8 6.4 9.0 n.e. n.*. '., 16.1 Loans outetanding n.a. 11.2 14.3 12.7 n.a. n. . I1.4 32. 3 Loans past due n.e. 7.6 7.7 7.3 n.a. n.e. 1.5 8.1 Past due ratio (I) n.a. 67.8 53.8 57.8 n.e. n.e. 8.7 25.0 Cotton Financting Proras Loans grantea /b 15.2 67.3 80.1 84.8 88.0 n.e. 2/4.2 n.a. Loens collecteT/b 12.9 41.7 52.8 61.9 66.1 n.e. 227.2 n.e. Loans outstandinF 2.3 25.6 34.3 n.a. n.a. n.a. 46.5 n.e. Loans pest due 2.3 12.4 23.5 n.a. n.e. n.a. 42.7 n.a. Post due ratio (2) 100.0 48.4 68.5 n.e. n.a. n.e. 91.h. n.a. Culavan as Kounlar n Loan grantea /b 22.2 26.7 31.8 46.7 62.0 71.1 74.4 n.a. Loans collecteT/b 15.8 18.0 20.0 26.7 44.9 n.e. 58.5 n.a. Loans outstandiin n.e. n.a. n.e. n.e. 17.1 n.e. 15.9 n.e. Loans past due n.a. n.e. 8.8 9.6 9.1 n.e. 14.6 n.e. Past due ratto (S) n.a. n.e. nU.. n.a. 53.2 n.e. 91.8 n.e. IAF-Tobacco Financing Program Loans 4ranted /b 3.4 58.2 74.8 93.9 105.7 n.s. 51.6 22.5 Loans collecte7b 2.1 47.3 59.4 77.5 92.3 n.a. 42.0 n.a. Loans outetandi.gr 0.4 10.9 15.4 10.6 13.4 n.a. 9.6 n.e Loans past due n.a. 6.4 5.6 5.8 7.8 n.e. 4.1 n.a. Past due ratio (S) n.a. 58.7 36.4 54.7 58.2 n.a. 42.8 n.a. Zan tr Dantated a 35.3 79.2 94.8 96.6 101.7 n.e. 168.8 n.e. Loans collecteT/b n.e. 12.2 21.2 25.1 25.4 n.a. 31.6 n.e. Loans outatenditng n.e. 67.0 73.6 76.5 76.3 n.a. 74.8 n.a. Loans past due n.a. n.a. 12.3 29.1 n.a. n.a. 8.2 n.e. Past due ratio (S) n.e. n.a. 16.7 38.0 n.a. n.s. 95.0 n.e semhang Neyon Support Program -oans granted /b 0.6 1.7 3.4 4.1 5.8 n.a. 5.9 5.8 Loans collecteT/b 0.1 0.1 0.2 0.6 1.2 n.e. 2.3 2.6 Loans outstendi.gi n.a. n.e. 3.2 3.5 4.7 n.a. 3.6 3.2 Loans pest due n.a. 0.1 0.1 0.1 0.4 n.e. 1.2 I.h Past due ratio (S) n.a. n.a. 3.1 2.8 7.9 n.a. 33.4 49.0 AMro-Industrial Technology Transfer Loans granted /b n.a. n.a. n.e. n.e. 36.4 258.7 108.5 401.6 Loans collecteT7/b n.a. n.a. n.e. n.e. n.a. n.a. 0.3 2.4 Loans outstandidr n.a. n.a. n.e. n.e. n.a. n.a. 108.2 212.1 Loans past due n.a. n.e. n.e. n.a. n.e. n.a. 0.8 5.3 Past due ratio (2) n.e. n.a. n.a. n.e. n.a. n.a. 0.7 2.0 Quedan Ftnanclng Pro ram Loans grante, Sb 18.0 100.6 271.8 621.8 915.6 1,373.7 1,767.3 2,708.9 Loana collecteT7b n.e. 69.6 271.8 n.a. n.e. n.a. 1,625.5 2,308.0 Loasns outstandigr 3.3 31.0 100.0 74.5 53.2 n.a. 141.9 4001.9 Loans past due n.a. 0.0 0.0 0.5 0.3 n.a. 3.2 5.4 Past due ratio (2) n.e. 0.0 0.0 1.0 1.0 n.a. 2.3 1.0 Guarantee Fund for Small end tedium gnterprt ees /e t ngranteda/ n.e. n.e. n.a. n.a. 35.5 148.5 289.4 407.7 Loans collectedb n.e. n.a. n.s. n.a. 0.0 2.0 9.5 92.7 Loans outstandtnR n.e. n.s. n.s. n.a. 0.0 n.a. 62.2 263.0 Loans past due n.e. n.a. n.a. n.e. 0.0 n.a. 15.8 13.4 Past due ratio (S) n.a. n.a. n.a. n.a. 0.0 n.a. 12.4 6.0 Industrial Guar ntee Loan Fund /t Loa nS granted n.e. 234.4 188.4 211.6 484.7 615.9 223.9 n.a. Loans collected n.a. 49.3 80.3 83.8 108.9 194.5 628.5 n.e. Loans outstanding n.e. 415.8 522.7 651 5 1,037.2 1,462.2 1,056.6 n.e Loans pest due n.a. 25.4 50.2 52.1 46.7 48.3 47.5 n.e. Past due ratio (2) n.a 6.1 9.6 8.0 4.5 3.3 3.3 n.a. /s As of June 30. 1987. 7 Cumulative loen balances. 71 Formerly Palayan ng Bayan, laplemented in 1980. 7! Implemented in 1983. 7 Balances reflect lending banks' balances. Implemented in 1984. 7r Data obtained from CB-DLC. Loans granted and collected are not cumulative. Source: ACPC, TBAC Annual Reports 1980-85. P)IILIPPIMES FPNCAL SECI-x S1UD11 50vern ent-S&pervited/Dtrected Credtts: ladstry year Implementing ine of program Fund ources Major objectts erpleented aency lnding chanels Industrtal Credits - Locally Funded Teebonology Utiitza on Nat tonal Treasury To provide conceasional lending through a 1980 TLkC-DSP TL&C Support System (TUSS) technology delivery fund for prelnveatuent and project developmet requtrements of a technology application project and tap istlable technical and mnagerial exper- tise for development and lmplemwntation of techonology ventures. Industrial Loan Program Cb/Sational Treasury Initially. to match advances mde by Cen- 1981 C--Apex Aecredited/lead tral Bank to troubled quast-banks and over banks the long run focus on the general prob- lems and difficulties encountered by pri- vate enterprises that are to be rehabtit- toted. Funds are on-lent pertly as equity " to distreased corporations am pert of a financial reorgantation package that would enable them to pay the quaes-banks wbo in turn can repay their Cb advances. Salikatan Sm xabehyen National Treasury To encourage livelihood progrm among 1986 TEC-DIP TLEC Progrm (ISP) urban residents by provtding funding asitstance. Tulong ma Too Program Sationsl Treasury 1986 Departoent of DTI Trade and Industry (DTI) Industrtal Credits - Foreign Assisted Industrial Guarantee and UB/SDA To met financtng needs of collateral- 1952 C-DLC Accredited banks Loan Fund (ICLF) deficient small and medtm enterprises. Export Indastry Pbderniaa- OECF To improve and/or modernize operations and 1980 TLlC-DIP mUG - tton Program facilities of mil- to medium-scale enterprises by providing funds so thst their products can be cowpettive In international markets. Year l.plsewnting Nae of progrm Fund sources Major objectfven Implemented agency Lending channels Urban Livelihood Financing MI/National Treasury To provide soft-term loans for relendtng 1981 TLRC-DlP TLRC Program (ULFP) to micro and small to medium entrepreneurs In lou-income communittes of Metro Manila. Apex Developnent Finance WI/National Treasury/ Productive iovestment financing for 1981 CB-Apex Accredited banks Lloyds lonk edium- and large-scale enterprises througb ultiple financial tntermediaries. Textile Rehabilitation We To provide financing for the rehabilita- 1982 DTI Joint BOt/DBP Evalu- Program tion, odernization and expansion of tex- atlon Team tile subsectors and training and tecbnical requtre ents of Individual firms with a view to improving their technical opera- tions and reducing costs. Industrial Guarantee Program - Locally Funded Philippine Export and For- National Treasury To provide guarantee coverage to Filtpino 1974 Philguarantee Philguarantee. eign Loan Guarantee Corpo- exporters on dteir borrovings whetber accredited bonks ration (Philguarantee) obtained from local or foreign sources and to Issue suaranteen and counterguarantees for bid bonds, performance bonds and s advance payment arransements. Enuity Program Ventur' Capital Programs Venture Capttal Corporation To provide additional capital/equity 1980 VCC If-VCCa (VCC) financing to cottage, small and medium businesses. PhiMa enture Cspttal To provide growth funds on an equity basis rvcc PVCC Corporation (FVCC) to innovative smell- and medium-scale enterprises. o0 __~~~~~~ 45 - ANNE 38 Va-se Z f S PHILIPPINES FINANCIAL SECTOR STUDY Estisatilon of Subsidy Provided to End Users under *3 Major Current Directed Progras_ In A8riculture 1981-86 Prevalling Rate Selected major Average market-oriented On-lending differ- Amount of programs/year outstanding Interest rate /a rate ential subsidles (F mm)n ) ( () (2) (P mmn) Mssauna 99 (M-99) 1981^l - 1,015 16.0 12.0 4.0 40.6 1982 1,038 16.8 12.0 4.8 49.8 1983 1,045 18.8 12.0 6.8 71.1 1984 1,071 26.7 22.0 4.7 50.3 1985 /b 1,043 28.3 23.0 5.3 55.3 1986 1,015 17.1 15.0 2.1 21.3 Interest subsidy 288.4 Loans uncollected /c 1,034.0 Subtotal 1.322.4 Intensified Rice Production Program (IRPP) (implemented in 1984) 1984 n.a. 26.7 - - - 1985 n.a. 28.3 15.0 13.3 - 1986 72 17.1 15.0 2.1 1.5 Interest subsidy 1.5 Loans uncollected 105.0 Subtotal 106.5 Cotton Financing Program (CFP) --1981- 14 16.0 12.0 4.0 0.6 1982 30 16.8 12.0 4.8 1.4 1983 30 18.8 12.0 6.8 2.0 1984 30 26.7 22.0 4.7 1.4 1985 /b 36 28.3 23.0 5.3 1.9 1986 41 17.1 15.0 2.1 0.9 Interest subsidy 8.2 Loans uncollected 47.0 Subtotal 55.2 -46 - AMNNE 38 PFge 2 of S Prevailing Rate Selected major Average market-oriented On-lending differ- Auount of programs/year outstanding interest rate/a rate ential subsidies (P min) (S) (S) (Z) (F Ulu) Biyayang Dagat Program (BDP) 1981 67 16.0 12.0 4.0 ' 2.7 1982 71 16.8 12.0 4.8 3.4 1983 76 18.8 12.0 6.8 5.2 1984 77 26.7 22.0 4.7 3.6 1985 /b 77 28.3 23.0 5.3 4.1 1986 77 17.1 15.0 2.1 1.6 Interest subsidy 20.6 Loans uncollected 137.0 Subtotal 157.6 Cooperative Development Loan Fund (CDLF) 1981 88 16.0 12.0 4.0 3.5 1982 88 16.8 12.0 4.8 4.2 1983 88 18.8 12.0 6.8 6.0 1984 88 26.7 22.0 4.7 4.1 1985 /b 101 28.3 23.0 5.3 5.4 1986 114 17.1 13.0 4.1 4.7 Interest subsidy 27.9 Loans uncollected 36.0 Subtotal 63.9 Expanded Corn Program (ECP) (implemented in 1984) 1984 n.e. 26.7 - - - 1985 n.a. 28.3 15.0 13.3 - 1986 112 17.1 15.0 2.1 2.4 Interest subsidy 2.4 Loans uncollected 47.0 Subtotal 49.4 -47- ANNEX38 Page 3 of 5 Prevailing Rate Selected major Average market-oriented On-lending differ- Amount of prograts/year outstanding Interest rate /a rate ential subsidies (P mln) (%) (2) (2) (P mn) Coastal Aree Resource Enter- prise Development (FSDC-CARE) (implemented In 1983) 1984 n.a. 26.7 - - 1985 n.a. 28.3 7.0 21.3 - 1986 4 17.1 7.0 10.1 0.4 Interest subsidy 0.4 Loans uncollected n.a. Subtotal 0.4 Bagong Kilusang Kabuhayan at Kaunlaran (B-KKK) (implemented in 1983) 1983 n.a. 18.8 - - - 1984 n.a. 26.7 - - - 1985 n.a. 28.3 23.0 5.3 - 1986 1,275 17.1 14.0 3.1 39.5 Interest subsidy 39-5 Loans uncollected 1,196.0 Subtotal 1,235.5 Special Agriculture Rehabili- tation Fund (SARP) (implemen- ted in 1978) 1981 n.a. 16.0 - - - 1982 43 16.8 10.0 6.8 2.9 1983 43 18.8 10.0 8.8 3.8 1984 39 26.7 10.0 16.7 6.5 1985 /b 38 28.3 10.0 18.3 7.0 1986 37 17.1 10.0 7.1 2.6 Interest subsidy 22.8 Loans uncollected 35.0 Subtotal 57.8 ~ 48 _ ANNEX 38 Page r of 5 Prevailing Rate Selected major Average market-oriented On-lending differ- Amount of programs/year outstanding interest rate /a rate ential subsidies (P mln) (Z) (x) (S) (p min) Quedan for Traders (via Rediscounting) 1981 17 16.0 12.0 4.0 0.7 1982 66 16.8 12.0 4.8 3.2 1983 88 18.8 12.0 6.8 6.0 1984 64 26.7 22.0 4.7 3.0 1985 /b 81 28.3 23.0 5.3 4.3 1986 98 17.1 15.0 2.1 2.1 Interest subsidy 19.3 Loans uncollected 0.0 Subtotal 19.3 Guarantee Fund for Small and Medium Enterprises GFSME) (implemented in 1984) /d 1984 10 - - 12.0 1.2 1985 135 - - 5.0 6.8 1986 285 - - 2.0 5.7 Interest subsidy 13.7 Loans uncollected 6.0 Subtotal 19.7 Maisan Corn Program 1981 123 16.0 12.0 4.0 4.9 1982 123 16.8 12.0 4.8 5.9 1983 123 18.8 12.0 6.8 8.4 1984 123 26.7 22.0 4.7 5.8 1985 /b 123 28.3 23.0 5.3 6.5 1986 123 17.1 15.0 2.1 2.6 Interest subsidy 34.1 Loans uncollected 132.0 Subtotal 166.1 - 49- ANNEX Vase 5 Of 5 Prevailing Rate Selected major Average market-oriented Ot-lending differ- Amount of programs/year outstanding Interest rate /a rate ential subsidies (P min) (Z) (Z) () (P mln) Naisagana Corn Program (implemented in 1982) 1982 52 16.8 19.0 4.8 2.5 1983 68 18.8 12.0 6.8 4.6 1984 81 26.7 22.0 4.7 3.8 1985 /b al 28.3 23.0 5.3 4.3 1986 81 17.1 15.0 2.1 1.7 Interest subsidy 16.9 Loans uncollected 147.0 Subtotal 163.9 Total interest rate subsidies 495.7 Total loans uncollected 2,922.0 Total of Credit Subsidies in Domestically Funded Programs 3417.7 /a Interest rates on commercial bank short-term (one year and below) loans. /b Data not available for 1985. Mission estimates average outstanding for 1985 to be the average of 1984 and 1986 figures. /c As of year-end 1985. /d Banks lend their own funds with 2' direct subsidy provided by GFSHE. ANNEX 39 PHILIPPINES FINANCIAL SECTOR STUDY Movements of Exchange Rates, 1982-87 1982 1983 1984 1985 1986 1987 I II I II I Peso/US$ rate (end-period) 8.47 9.17 11.00 14.00 18.00 19.76 18.47 19.03 20.58 20.53 20.46 Percent change in Peso/$ rate (half-yearly) 3.29 8.28 19.96 27.27 28.57 9.77 -6.55 3.07 8.13 -0.24 -0.36 Cumulative 2 change in Peso/$ /a -58.59 -55.17 -46.22 -31.55 -12.00 -3.40 -9.73 -6.96 0.61 0.36 0.00 Average percentage change in Peso/$ /a -16.17 -16.33 -14.36 -10.26 -4.17 -1.38 -4.99 -4.70 0.61 0.72 0.00 Treasury bill rate (6 month) 15.31 14.26 14.13 15.91 26.75 42.17 33.43 16.56 14.73 10.51 13.14 US T-bill rate 11.04 8.01 8.81 8.96 10.09 8.58 7.31 7.01 5.83 5.34 5.50 Cumulative net loss from investing In Pesos /a,/b -32.18 -30.15 -25.78 -13.43 7.58 34.10 37.18 12.03 3.56 7.29 2.79 Peso/Yen rate (ene-period; x 10,000) 332 391 459 600 759 789 742 938 1,244 1,273 1,394 Percent change In Peso/$ rate (half-yearly) -9.78 17.77 17.39 30.72 26.50 3.95 -5.96 26.42 32.62 2.33 9.51 Cumulative change in Peso/$ /a -76.18 -71.95 -67.07 -56.96 -45.55 -43.40 -46.77 -32.71 -10.76 -8.68 0.00 Average percentage change in Peso/$ /a -24.95 -24.61 -24.25 -21.40 -18.34 -20.36 -27.04 -23.21 -10.76 -16.61 0.00 /a From date shown to 1987. 7-b Rather than US$.