Equitable PCI Bank has assets totaling P250.3 billion and deposits amounting to P136.8 billion. It has BIS capital adequacy ratio of 12 percent, comfortably above the eight percent required by international standards.
In a disclosure to the Securities and Exchange Commission (SEC), Equitable PCI Bank reported a loss of P120 million in the second quarter this year. Profitability has generally declined in the Philippine banking industry due to prevailing economic conditions in the country.
A number of banks have reported a drop in profits, with some even recording losses for the year. Industry experts say, however, that the lower profitability is temporary in the case of the banks that are fundamentally strong. They project higher returns specially in 2002 for those with effective management programs.
The bank said it is now fully on track in its overall program under the new management team led by its chairman Antonio Go and president and CEO Deogracias Vistan who formally joined the bank in June this year.
Already, Equitable PCI Bank is seeing success in its aggressive deposit recovery program. This has enabled the bank to make prepayments of P16 billion, or more than half of its BSP liquidity facility. Many originally assumed it would take a bank three to five years to pay. It is expected that additional growth in deposits will further allow the bank to manage its cost of funds to revert to lower levels while increasing its yields on assets, thus raising overall net interest margins.
Equitable PCI Bank’s management has placed its focus on long-term profitability, and it has embarked on programs to improve the balance sheet, reduce non-performing loans, set up further provisioning, and complete payment of its liquidity loan with the BSP.
Equitable PCI Bank has likewise taken the lead in arrangements with an asset management company to further reduce its non-performing loans, helping enhance its long-term profitability.
Equitable PCI Bank’s inherent financial strength has enabled it to surmount difficulties it encountered late last year and early this year. In an earlier report on the bank’s performance, Merrill Lynch observed: "Equitable PCI Bank has survived the worst. The fact that the bank survived the crisis is a testament to the bank’s inherent strength. Weaker banks would likely have folded under similar circumstances."