Philippine financial system sustains strong performance in H1 — BSP

MANILA, Philippines — The country’s financial system managed to sustain its “strong performance” in the first semester of the year amid lingering global financial market volatility, the Bangko Sentral ng Pilipinas said.

In a report, the BSP said total assets of the Philippines’ banking system expanded 10.3 percent in the first six months of the year to P17.70 trillion, higher than the level posted in the same period last year.

The central bank said the double-digit expansion in the sector’s total assets was driven by upbeat loan growth funded by stable peso deposits from residents.

By industry, universal and commercial banks held the bulk of the banking system’s total assets at P14.28 trillion.

Amid the growth in loan portfolio, the loan quality of the banking system remained satisfactory, with share of soured debts held by banks to total loans unchanged at 1.9 percent from the ratio recorded a year ago.

“Banks’ prudent risk-taking behavior, sound corporate and risk management standards, investment in enabling and transformative financial innovation, and continuing commitment to pursue meaningful financial sector reforms all contributed to the steady growth and stability of the domestic financial system,” the central bank said.

“While there are lingering volatilities in the external macroeconomic environment, the country’s underlying fundamentals and continued investor confidence supported the steady growth of the domestic financial sector,’ it added. — Ian Nicolas Cigaral