Written Activity # _______

Framework of Thesis
(Chapter 1 – Introduction)

Title: A Comparative Study on Economic Benefits Between Bank Employees in

Philippine Rural Banks and Selected Thrift Banks

Group Members: Section: 3FM1

1. REYES, MIKHAIL NIKKO________________ 4. TAGUMPAY, GERRY ________________

2. RODRIGUEZ, ARON___________________ 5._________________________________

3. SHI, JOHN SEDRYCK_ _________________

I. Abstract:

Philippine Rural Banks are banks located in the immediate areas of the country. They aim to
provide customized financial banking services to locals such as farmers and fishermen to improve their
rural economy in an effective way. Correspondingly, bank employees in rural banks are considered as one
of the key components on their success with the service they provide to the locals. The paper presents
the study on the economic benefits received by the rural bank employees and correlates them with that
of the thrift bank employees. The factors to be considered are the income, allowances, insurance, and
health benefits of the bank employees from the two types of bank. The research paper is quantitative and
correlational, since it will measure the preceding variables. In detail, the data are to be collected through
surveys and to be analyzed using the correlation analysis and the Pearson correlation coefficient.

II. Background of the Study:

The researchers conducted this study for the Philippines is known for its agricultural and fishing
society. Rural banks are not as prominent as other banking institutions (commercial, savings, etc.);
however, it focuses and caters to credit those who are in the agricultural sector and those alike. As small
as it is, it widened the curiosity of the researchers for those who are currently working in these banking
institutions, specifically the economic benefits they receive and possess. These said banks offer great
significance for the country as information regarding the underlying factors, such as: workers’ wages,
insurance and healthcare are disclosed to the public. With that being said, this would be beneficial for
researchers as they would be able to relay or develop the information garnered from the said study,
especially since the purpose of rural banks are not widely known in the country. Also, this would be in the
convenience of the researchers for their future endeavors as this topic is aligned with their course,
namely: Financial Management.

III. Significance of the Study:

The study would benefit the academe, especially in the Financial Management program to gain
wider knowledge in the world of rural banking. To compare working in these financial institutions to thrift
banks.

It would help the banking industry for it would allow us to convey to the audience information on
rural banks and what it is like employed in this financial institution. To help those who are planning to
apply for these types of banks and possibly for those who would like to establish their own in the future.
 Lastly, it would help the future researchers to be aware and more knowledgeable on the
information provided to them. To supply them conducted tests and recommendations which they can
use to further elaborate the research.

IV. Statement of the Problem:

1. What is the profile of the employees for both rural banks and selected thrift banks in terms of:

1.1. Salary

1.2. Incentives

1.3. Insurance

2. Is there any significance to classify on income benefits of banking employees to how much difference

there are between the rural bank and selected thrift bank employees in terms of:

2.1. Salary

2.2. Incentives

2.3. Insurance

3. How rural banks maintain the benefits they provide to their employees in consideration of their

losses?

V. Hypotheses:

1. H0: There is no significant correlation between the bank employees in rural banks and selected thrift

banks in relation to wages, incentives and insurance.

H1: There is no significant correlation between the bank employees in rural banks and selected thrift

banks in relation to wages, incentives and insurance.

2. H0: There are no significant method to classify the income benefits of banking employees to how

much difference there are between the rural bank and selected thrift bank employees in terms of the

wages, Incentives and insurance.

H1: There are significant method to classify the income benefits of banking employees to how much

difference there are between the rural bank and selected thrift bank employees in terms of the wages,

Incentives and insurance.

3. H0: There is no significant correlation to determine how rural bank maintain the benefits they provide

their employees In consideration of their losses.

H1: There is significant correlation to determine how rural bank maintain the benefits they provide their

employees In consideration of their losses.

V. A Conceptual Framework/Simulacrum:

B. Theoretical Framework

1. Neoclassical microeconomic theory which focuses on resource allocation and utilization Efficiency
advocates non-wastage of resources by emphasizing cost reduction while producing the maximum
possible level of output for a given level of inputs given the technology. This would help enforcing our
knowledge on how to measure the compensation of rural banks and independents variables that may
affect the behavior of every company towards its expenditure and investment.

2. Equity Theory suggests that employee perceptions of what they contribute to the organization, what
they get in return, and how their return-contribution ratio compares to others inside and outside the
organization,' determine how fair they perceive their employment relationship to be. This theory gives us
more knowledge on how to compare banking employees in terms to what they see as equal to other
banking firms in terms to their work and compensation of their jobs.

3. Agency Theory focuses on the divergent interests and goals of the organization's stakeholders, and the
ways that employee compensation can be used to align these interests and goals, ownership and
management (or control) are typically separate in the modern corporation, unlike the days when the
owner and manager was often the same person. This theory provides us a more specific method on how
to examine and correlate the goals of the banking firm with the goals of its bank employees.

VI. Scope and Limitation:

 The study will be conducted in an estimated time of 2 months, depending on the availability of
the researchers, as well as the availability of resources and information

The expenses of the research won't be a bit of an issue, considering that the study would focus
mainly on the discussion of the provided topic. To estimate, the costs will possibly include the printing of
materials and the allowance provided to food for the researchers. All things considered, costs will be at
an expected sum between 1000 to 2000 pesos.

The whole study will be focused and limited on the rural banks in the Philippines. The
researchers will also consider using specific commercial banks, such as Banco de Oro (BDO) and Bank of
the Philippine Islands (BPI) for comparison. The researchers will also put more emphasis on the
employees of the banks, particularly the benefits they receive, economically. Moreover, focusing on
other types of banks will be unnecessary and excluded in the study, as well as the information to acquire
from the employees will not go further outside their benefits as workers in the bank.

VII. Definition of Terms:

Agricultural Sectors - refers to the farming and fishing industries of rural areas

Costs - this refers to the total expenditures to a given activity

Economic Benefits - refers to benefits that are fixed to employees. These benefits are quantified in
terms of salaries, health benefits and insurances and etcetera.

Financial Institutions - refers to the medium that provide financial services and an intermediary to the
market such as banks.

Rural Banks - refers to banks which aims to expand the rural economy in an effective manner

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