Technically, these banks are not big enough to cause systemic failure but, given the fragile economy, any bank run (no matter how small and contained) could have a larger-than-usual impact on the industry.
Here are two reasons why.
One, these drugs are initially supposed to be distributed through government hospitals. With only 11 hospitals accredited so far in the program, the distribution network of these drugs is limited (read: you have to make a conscious effort to go to the pharmacy of a particular hospital).
Two, the PITC is said to be having problems collecting from hospitals. With poor collections, the importing arm of the Department of Trade and Industry cannot turn around and buy some more stuff from abroad.
Al Yuchengco was vehemently against the majority sale of the Philippine Long Distance Telephone Co. to the Hong Kong-based First Pacific Co. but eventually sold his stake in the telecommunication company for a good price.
Mr. Yuchengco was understandably against the move of Henry Sy Sr. to gain majority control of China Banking Corp. After all, Mr. Yuchengco’s eldest daughter, Helen Yuchengco-Dee, is married to China Bank president, Peter Dee, whose family was one of the founders of the bank.
As everybody knows, Mr. Yuchengco decided to concentrate on Rizal Commercial Banking Corp. and sold his China Bank shares to Mr. Sy.
Right now, Mr. Yuchengco wants to "return" credit card company, Bankard, Inc. to its former owner, Equitable PCI Bank, after about three years of running it.
EPCIB, which is closely associated to the family of chairman Antonio Go, is currently fighting two formidable fronts – Mr. Yuchengco and Mr. Sy.
You see, Lanny Nañagas insists on making a courtesy call on the local political kingpins. During these talks, Mr. Nañagas asks politicians (from various persuasions) what their infrastructure dreams are for their constituents and how the bank can help make these dreams come true.
Mr. Nañagas reasons that financing projects that locals need is a sure way of getting repaid.