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The country’s total financial system resources grew 7.8 percent last year to ₱33.780 trillion compared to ₱31.338 trillion in 2023, boosted by the continued expansion in funds, assets, capital, and issuance of more debt securities.
Financial resources, held by banks and non-banking financial institutions (NBFIs), are dominated by the banking sector with ₱28.255 trillion or 84 percent of the total resources last year, based on data from the Bangko Sentral ng Pilipinas (BSP).
The end-2024 banking sector resources were up 8.8 percent compared to end-2023’s ₱25.957 trillion.
Bank-controlled resources continued to grow because of deposits, loans, and banks’ sustained earnings. Last year, the industry posted combined net income of ₱391.284 billion, up by 9.8 percent year-on-year.
By banking group, the big banks or the 44 universal and commercial banks accounted for ₱26.437 trillion of bank-held resources. This was 8.7 percent higher than the previous year’s ₱24.315 trillion.
The 41 thrift banks also contributed ₱1.147 trillion, up 5.8 percent from ₱1.104 trillion in 2023.
The six digital banks, which started operations between 2021 and 2022, grew their resources to ₱121.8 billion, which was 33.5 percent higher than the previous year’s ₱91.2 billion.
As for the 361 rural banks and 21 cooperative banks, their total resources increased by 18 percent to ₱527.1 billion from ₱446.5 billion in 2023.
Meanwhile, since NBFIs or non-banks have a lag period of six months at least, the data was still set at end-June 2024 of ₱5.524 trillion, up by 2.65 percent from same period in 2023 of ₱5.381 trillion.
NBFIs are investment houses, finance companies, investment companies, securities dealers/brokers, pawnshops and lending investors. Non-Stock Savings and Loan Associations (NSSLAs), credit card companies under BSP supervision, private insurance firms, the Social Security System, and the Government Service Insurance System are also classified as NBFIs.
The BSP is supervising 1,546 NBFIs without quasi-banking function. These are investment firms, NSSLAs, and pawnshops. Only five NBFIs have quasi-banking function, which means they can borrow funds from 20 or more lenders. These include investment houses with trusts business and financing companies, among others.
In its most recent BSP Report on the Philippine Financial System, the central bank highlighted the strong performance of the banking sector on the back of an improved macroeconomic environment, and the support of the BSP’s progressive financial sector reforms.
BSP Governor Eli M. Remolona Jr. said banks are the pillar of the domestic financial system, and the central bank’s ongoing financial reforms “help sustain the resilience of the banking sector,” thus enabling banks to have a “bigger role in the domestic economy through continued financial services to their clients.”
The BSP has been pursuing prudential policy reforms for the industry’s institutional stability, digitalization, and inclusive sustainable finance.
