An empirical study on the capital adequacy ratio, efficiency, and performance of commercial and universal banks in the Philippines

Date of Publication


Document Type

Bachelor's Thesis

Degree Name

Bachelor of Science in Applied Economics

Subject Categories



Ramon V. Del Rosario College of Business



Defense Panel Chair

Lawrence Dacuycuy

Defense Panel Member

Ruperto P. Majuca


The primary focus of this paper is to examine the relationship among several financial factors namely capital adequacy, bank efficiency, and bank performance. In order to make this paper reliable and concise, essential and relevant data were gathered from both private and government owned universal and commercial Philippine Banks listed by the Bangko Sentral ng Pilipinas (BSP). Twelve (12) banks were utilized to be precise. The data used in this paper were derived from financial statements over the period of 2001-2012 of the said twelve banks. With the use of Panel Data analysis and Linear Regression techniques, the group was able to analyze vital data thus revealing significant relationships among the variables that measure capital adequacy, bank efficiency, and performance A plethora of variables can be utilized in order to measure capital adequacy, efficiency and performance however, the group only focused on specific variables such as returns on both assets and equities, cost-income ratio, tier 1 leverage ratio, tier 1 capital ratio, shareholder equity ratio, debt-to-equity ratio, bank size, and asset growth. The group hypothesizes that performance which is represented by returns on both assets and equities will have a negative relationship with capital adequacy. The group also concludes that the efficiency of Philippine banks as measured by the cost-income ratio, bank size, and asset growth will have negative relationships with bank performance.

Abstract Format






Accession Number


Shelf Location

Archives, The Learning Commons, 12F, Henry Sy Sr. Hall

Physical Description

96 leaves ; 28 cm.


Universal banks--Philippines; Banks and banking--Philippines; Bank capital--Philippines

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