Philippine banks 9th strongest in Asia Pacific

MANILA, Philippines - Philippine banks have been ranked 9th in Asia Pacific in terms of strength, The Asian Banker reported yesterday.

The Philippines got a score of 2.90 in the Asian Banker (AB) 500 Strongest Bank by Balance Sheet Ranking 2015. The AB 500 is an evaluation of the 500 largest banks in the Asia Pacific region.

When measured on an asset-weighted basis, banks in Hong Kong achieved an average strength score of 3.74 out of five. Hong Kong had the largest number of banks in the top 10 strongest banks list, with four banks in total.

Singapore placed second with a score of 3.7 followed by China with 3.3, Macau with 3.3, New Zealand with 3.2, Malaysia with 3.2, Thailand with 3, and Australia with 3.

The think tank said Bank of China (Hong Kong) emerged with the strongest balance sheet in the region, partially profiting from the continued development of its offshore renminbi business.

Bank of China got a total score of 4.15 followed by OCBC Bank of Singapore with a score of 4.14, Industrial & Commercial Bank of China (Macau) with 4.13, Industrial & Commercial Bank of China (Asia) with 3.96, the Hongkong and Shanghai Banking Corp. with 3.93, Hang Seng Bank with 3.88, United Overseas Bank with 3.81, and Industrial & Commercial Bank of China with 3.76.

Metropolitan Bank & Trust Co. (Metrobank) ranked 9th with a total score of 3.76. This was a big jumped from its previous rank of 19th in the 2014 survey.

The Asian Banker said 2014 has proved a challenging year as banks across the region faced failing profit margins and weakening asset quality amid strong completion.

Just like last year, it pointed out 2015 has been a challenging year for banks I the region so far.

 “The decline in Asia Pacific banks’ asset quality has continued to impact profitability. Competition from non-banks and relatively low interest rates also affected bank profit margins, which underscored the need for commercial banks to improve the structure of their revenue,” it said.

It added the decision of the People’s Republic of China to cut interest rates five times since November last year has put pressure on banks’ interest income.