Philippine banks’ assets up 6.6%

MANILA, Philippines — Total resources of Philippine banks rose by 6.6 percent to P20.03 trillion as of end-March from P18.78 trillion a year ago as the sector starts to recover from the impact of the COVID-19 pandemic.

Preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed assets of universal and commercial banks grew by 6.9 percent to P18.54 trillion as of end-March from P17.35 trillion a year ago. Big banks’ assets accounted for more than 92 percent of the local banking industry’s total resources.

Likewise, assets of mid-sized banks or thrift banks booked a 2.9 percent increase to P1.18 trillion from P1.14 trillion.

The 6.1 percent growth rate of the total resources of the Philippine banking system in 2020 was lower than the 8.4 percent increase in 2019 and 11.5 percent rise in 2018 mainly due to the impact of the pandemic.

The BSP said the Philippine financial system entered the pandemic in a relatively strong position in 2020 and weathered its effects while ensuring the relevant delivery of financial services to the economy.

The COVID-19 pandemic tested the resilience of the banking system and the robustness of the financial ecosystem as the country reacts to the global health crisis, the BSP said.

It also said the crisis significantly affected the operations of banks as the enhanced community quarantine and social distancing measures prompted them to adjust their daily services.

“The Philippine banking system, as the core of the Philippine financial system and main credit provider of the economy, remained fundamentally sound and stable amid the COVID-19 pandemic as indicated by growth in assets, deposits and capital, together with positive net profit, stable capital buffers and ample loan loss reserves. It also shifted to digital channels to keep its critical role in sustaining a functioning financial system with continued delivery of relevant financial services to the public during the pandemic,” the BSP said.