Bank deposits grow to P12.5 trillion in 11 months

MANILA, Philippines — More Filipinos continue to entrust their savings with banks as deposits rose by nearly nine percent in the first 11 months of last year amid the strong economic growth.

Total bank deposits reached P12.49 trillion from January to November last year, P1.02 trillion higher than the P11.48 trillion recorded in the same period in 2017.

Data from the Bangko Sentral ng Pilipinas (BSP) showed peso-denominated deposits increased by 9.6 percent to P10.37 trillion in the first 11 months of 2018, while foreign currency deposits owned by residents went up six percent to P2.13 trillion.

“The Philippine banking system exhibits steady growth in assets and deposits,” the central bank said.

It added local banks continued to lend more support to the country’s long-term economic growth and stable financial condition.

The industry booked a double-digit growth of 10.4 percent in resources to P16.72 trillion from January to November last year compared to P15.15 trillion in the same period in 2017.

Assets of big banks or universal and commercial banks rose by 10.8 percent to P15.17 trillion from P13.69 trillion, while that of mid-sized banks or thrift banks inched up 6.5 percent to P1.27 trillion from P1.19 trillion.

The BSP has already released the framework for banks to offer a basic deposit account to promote account ownership among the unbanked and provide Filipinos the tool to save and transact money in a safe, convenient and affordable manner.

The BSP said the framework could unlock access to a wider range of financial services to meet their various needs, including credit, insurance and investments.

The minimum key features of the account include: simplified know-your-customer (KYC) requirements; an opening amount of less than P100; no minimum maintaining balance; and no dormancy charges.

To prevent misuse of the basic deposit account, its maximum balance is set at P50,000. These features meet the need of the unbanked for a low-cost, no-frills deposit account clients could open even if they do not have the standard identification documents.

As an incentive for banks, the basic deposit account is granted a preferential zero reserve requirement which lowers their account maintenance cost.

The BSP clarified the regulatory incentive does not apply to regular bank accounts even if their balances fall below P50,000.

The central bank said the basic deposit account supports the implementation of the National Retail Payments System (NRPS) that aims to increase adoption of digital payments in the country.