The Philippines, Pinoys are awash with cash

outlets like savings instruments, certificates of deposits, bonds, investment packages.

The country’s 10 million expats will remit this year $21 billion (about P860 billion), enough to cover half of Aquino’s budget in 2012. This money is practically orphan. It goes mainly to consumption which explains the booming mall business of Henry Sy Sr. and John Gokongwei Jr. Henry builds four malls a year, double his previous pace four years ago.

The Philippine commercial banking system had total deposits of P5.04 trillion half the size of the GDP.

Of the P5 trillion, only P3.57 trillion has been lent out, leaving P1.47 trillion deposits which are idle (most of it parked in safe securities issued by the Bangko Sentral). Imagine what P1.5 trillion could do to our lives and to our economy if that were released to the economy?

How come that money is idle when close to 25 million Filipinos are dirt poor? Why?

The P1.47 trillion is enough to fill the pockets of 25 million Filipi- nos (the number of the poor) with P58,000 each and suddenly they will be middle class, with $3.92 in per capita income per day—double the poverty threshold.

Clearly, something needs to be done with so much cash being idle. The Philippines has so huge a reserve pile—$82 billion, the Bangko Sentral decided to lend the bankrupt banks of Europe $1 billion.

The interest for that money— less a fifth of a percent. To us, that’s scandalous. Giving away P41 billion in cash to the mismanaged banks of Europe and the union’s bankrupt governments.

Meanwhile, the country’s universal and commercial banks sustained their robust growth trajectory in the second quarter of 2012, with combined resources reaching P7.10 trillion, up 6.42 percent from P6.67 trillion in the same quarter last year, according to an industry study prepared by China Banking Corp., one of the country’s top 10 banks.

In a separate report, the Bangko Sentral ng Pilipinas says combined net profits of the banking industry (including thrift banks) grew by 17.1 percent or P8.9 billion to P60.8 billion for the first semester of 2012 compared with P51.9 billion for the same period in 2011.

The country’s top five banks according to asset size as Henry Sy’s BDO Unibank, George S.K. Ty’s Metropolitan Bank and Trust Co., the Ayala’s Bank of the Philippine Islands (BPI), state-owned Land Bank of the Philippines and Al Yuchengco’s Rizal Commercial Banking Corp. (RCBC).

BDO remains the only local bank with resources in the trillionpeso level—P1.18 trillion as of end-June 2012, up 14.35 percent from P1.04 trillion a year ago—and accounting for 16.68 percent of the industry’s combined resources.

Metrobank placed second with total resources of P942,988 bil- lion ( 13.28 percent market share), down 1.98 percent from P962.03 billion as of June 2011.

BPI remained in the third slot with total resources of P891.64 billion ( 12.55 percent market share), up 5.45 percent from P845.58 billion.

Land Bank ranked fourth with total resources of P600.13 billion (8.45 percent market share), followed by RCBC with P355.83 billion (5.01 percent market share).

China Bank fastest in growth

China Bank, also controlled by Henry Sy’s group, posted the highest growth rate in terms of resources among the top 10 banks. As of end-June 2012, its resources stood at P287.85 billion (No. 8, with market share of 4.05 percent), reflecting a 22.51 percent expansion from P234.97 billion year-on-year.

The universal and commercial banks also posted a double-digit growth in lending activities. Total loan portfolio (excluding reverse repurchase transactions) stood at P3.30 trillion as of end-June 2012, a 14.73 percent expansion from P2.88 trillion a year ago. Net loans grew by 13.28 percent to P3.44 trillion from P3.04 trillion.

BDO remained the biggest lender for both gross and net loans and posted the largest increase at P107.64 billion or 17.66 percent to P717.29 billion as of end-June 2012 and P107.67 billion or 18.48 percent to P690.14 billion, respectively.

Among the top 10 banks, China Bank posted the largest annual loan growth rate for both gross and net loans at 35.90 percent to P169.98 billion and 37.48 percent to P163.12 billion, respectively.

Metrobank accounted for the second largest gross loan portfolio at P458.61 billion, up 15.9 percent from P395.71 billion year-on-year.

BPI ranked third with P483.92 billion, up 17.02 percent from P413.54 billion; followed by Land Bank with P228.11 billion, a slight increase from P226.39 billion; and RCBC with P179.04 billion, up 24.43 percent from P143.88 billion.