According to BSP, Capital Adequacy Ratio is Up

The local equities market declined further yesterday amid the lack of positive, market moving developments, which did not spur much investment activity.

The PSEi retreated 48.97 points, or -0.82%, to 5,937.51. Almost all sectoral indices ended the day in the negative territory led by financials (-2.06%), property (-1.11%) and holdings firms (-0.78%), while only services (+0.21%) ended on a positive note.


Market breadth was negative with 93 declines outnumbering 48 advances, while 49 issues were unchanged. Total value turnover amounted to Php5.06 billion. Foreign investors were net buyers at Php0.12 billion.

According to the Bangko Sentral ng Pilipinas (BSP), universal and commercial banks’ capital adequacy ratio (CAR) registered at 17.98% by the end of first half, slightly higher than the previous quarter’s 17.75%. This is due for a project increase further this 2014.

Moreover, banks’ CAR on a consolidated basis stood at 19.24%, better than the 18.89% registered in the first quarter. Meanwhile, the CAR for the banks’ thrift arms was at 17.68% for the first half.

The first semester levels were well-above the 10% minimum requirement and the international norm of 8%. The central bank also stated that the sustained strength of the industry’s CAR was as a result of faster growth pace of qualifying capital vis-à-vis that of risk-weighted assets.

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