An analysis of the financial performance of Philippine National Bank (Pre-during and Post Privatization) 1987-1997

• Main Authors: Orfrecio, Calijohn, Rey Santos, Teresa Reastralyn Marie B., Sanchez, Joan Rae G., Surla, Catherine M.
• Format: text
• Language: English
• Published: Animo Repository 1999
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/16583
• Institution: De La Salle University

This paper is about the Effects of Privatization on the Financial Performance of Philippine National Bank: Pre-, During and Post. For the Period 1987-1997. The research problem is about determining how did privatization affect the financial performance of Philippine National Bank. For this paper, the objectives are : (1) To determine whether or not there is a significant difference between the financial performance of PNB, before, during and after privatization (2) To determine whether there is a significant difference between the financial performance of PNB and that of Land Bank (3) To determine whether there is a significant difference between the financial performance of PNB and that of Private Banks (4) To be able to provide a risk-return analysis for PNB. The generic null hypothesis is that No significant difference in the financial performance of PNB (before, during and post privatization), as compared to that of Land Bank and to that of Private Banks (BPI, Metrobank and PCI). On the other hand, the generic alternative hypothesis is that there is a significant difference between them. As to sample size, there are 16 ratios to be evaluated at 95% confidence. With respect to research design, the Descriptive Research is the one being used in this paper. Thus the quantitative tool used is ratio analysis and the t-statistic to test for significance. In the computations, Microsoft Excel is the software used. In summary, it was found that there was a significant difference between the financial performance of PNB before, during and after privatization as best amplified by its profitability ratios. The performance of PNB vis a vis Land Bank, another government bank also showed significant change as Land bank together with DBP started to take over some of the roles vacated by PNB. PNB, however remains competitive as a private bank though profitability a year and a half after being partially privatized, dropped noticeably. It is at par with BPI, Metrobank and PCI and that of the industry as a whole in terms of performance. PNB is complemented by a competent and highly satisfied staff eager to compete under a freer environment. PNB, by and large is still a sound viable partially privatized universal bank. It has survived the Southeast Asian contagion, an acid test for a fledgling bank, which plaqued the banking system in the Southeast Asia. It has paved the way for a liberalized banking system in the country which is healthy to the economy as a whole.