• PH financial system stable – BSP

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    The Philippine financial system continued to be stable on the account of sustained strength of the balance sheets of banks and non-bank financial institutions (NBFIs) regulated by the Bangko Sentral ng Pilipinas (BSP).

    According to the BSP’s Status Report on the Philippine Financial System for the first semester of the year, the resources of domestic banks, which represent 80 percent of the financial system, grew year-on-year by 16.2 percent to P8.6 trillion in June.

    The report attributed the increase to the 12.3 percent expansion in loans, which was financed by an 18.3 percent increase in deposits during the period.

    “These financial intermediaries also posted a 60 percent growth in net profits at the end of the first semester,” it stated.

    The BSP publication added that asset quality was maintained as lending increased, noting that at the end of first half, the banks’ gross non-performing loans were kept low at 3.3 percent of the banks’ total loan portfolio.

    Banks also remained adequately capitalized against risks as capital adequacy ratio stood at 18 percent on solo and 19.3 percent on consolidated bases in June. Tier 1, which represents high-quality capital, continued to be robust at 16.5 percent and 16.8 percent on solo and consolidated bases, it said.

    Meanwhile, the report mentioned that there were 683 operating banks, 8,860 bank branches, 13,129 automated teller machine, 391 microfinance banking offices, and 212 banks with e-banking services operating in the Philippines at end of June this year.

    “The BSP continues to widen financial access points under a defined financial inclusion strategy,” it said.

    The publication also said that entities with quasi-banking functions, non-stock savings and loans associations and other institutions under BSP jurisdiction also performed generally well during the first semester.

    Key performance indicators for these NBFIs reflected strong balance sheets and sustained profitability during the period, it said.

    “The strength of the financial system notwithstanding, the BSP continues to be vigilant against potential pressure points. This is in line with the BSP’s objective of promoting financial stability,” the BSP said. MAYVELIN U. CARABALLO

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