The Production Technology of Philippine Domestic Banks in the Pre-Asian Crisis Periods: Estimation of Cost Function in the 1990-96 Period

This is to analyzes the operational behavior and technical progress among Philippine domestic banks, using micro-level data on individual banks. First, we summarize their major business activities and gain insight on how the structure is changing. Then, we formally estimate the cost function of Philippine domestic banks using panel data covering a seven-year period (1990-96). The presence of economies of scale and economies of scope is investigated and technical progress in the banking industry is measured. In addition, the results of analysis for the Philippines are compared with those of similar studies on Thailand conducted by the author previously.

The asset/liability structure of the Philippine banks and non-bank financial institutions in 2000s : a preliminary study for financial access analyses

Based on the consolidated statements data of the universal/commercial banks (UKbank) and non-bank financial institutions with quasi-banking licenses, this paper presents a keen necessity of obtaining data in detail on both sides (assets and liabilities) of their financial conditions and further analyses. Those would bring more adequate assessments on the Philippine financial system, especially with regard to each financial subsector's financing/lending preferences and behavior. The paper also presents a possibility that the skewed locational and operational distribution exists in the non-UKbank financial subsectors. It suggests there may be a significant deviation from the authorities' (the BSP, SEC and others) intended/anticipated financial system in the banking/non-bank financial institutions' real operations.

Changes in source of profits and business strategies? : some evidence from the Philippines' universal banks in the 2000s

In the 2000s, the Philippines' local banking sector have conducted very conservative lending behavior and at the same time, gradually but continuously improved their profitability in terms of ROE (return on equity). A set of analyses on the flow of funds and segment reports (information) of local universal banks, whose loans outstanding to the industrial sector have dominated more than three fourths of the total outstanding, shows that (1) they have actively manage assets overseas, (2) their profitability has come from investment activities in the securities markets, and (3) some universal banks have shifted their resources into the consumer/retail segment. Although further refinement in the dataset is needed for a more detailed analysis, diverse business strategies would be expected among the local universal banks in the near future.

Asset composition of the Philippines' universal and commercial banks : monetary policy or self-discipline?

The central bank of the Philippines (Bangko Sentral ng Pilipinas, BSP) has improved its monetary policy measures since the 2000s. After rationalizing the country's banking sector since late-1990s, its monetary policy and the uniiversal/commercial banks' (UCBs) behavior in allocating their assets has changed since mid-2000s. Though further and more detailed studies are nesessary, based on the results of simple correlation analyses conducted in this paper suggest a possible mixture of the country's monetary policy and their own decision-making in asset allocations, instead of a "follow-through" attitude.