Financial system’s resources jump 7% as of end-August

The total resources of the Philippine financial system further expanded at the end of August, the Bangko Sentral ng Pilipinas (BSP) said.

Preliminary data from the BSP showed that resources of banks and nonbank financial institutions increased by 6.98% to P29.079 trillion in the eight-month period from a year earlier.

The growth in total resources was also faster than 6.61% a month ago.

These resources are held by banks and nonbank financial institutions, including funds and assets such as deposits, capital, as well as bonds or debt securities.

Data from the BSP showed that banking resources rose by 7.94% to PHP 24.046 trillion at end-August from a year earlier. These include universal and commercial banks, thrift banks, as well as rural and cooperative banks.

The total banking resources held by universal and commercial banks increased by 7.8% to PHP 22.593 trillion as of end-August from PHP 20.958 trillion a year ago.

Thrift banks’ resources went up by 11.98% year on year to PHP 1.056 trillion, while rural and cooperative banks’ resources rose by 5.87% to PHP 397 billion.

Meanwhile, resources of nonbanking financial institutions inched up by 2.59% to PHP 5.033 trillion from PHP 4.906 trillion a year ago.

Nonbank institutions include investment houses, finance companies, security dealers, pawnshops and lending companies. Institutions such as nonstock savings and loan associations, credit card companies, private insurance firms, the Social Security System and Government Service Insurance System are also considered nonbanks.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the growth in financial resources was due to the “continued profitability of banks and other financial institutions, leading to more capital, more funds for lending that supported further loan growth, and other investment activities.”

“This also reflects the continued growth in banks’ loans and deposits as the economy reopened further towards greater normalcy. Capital-raising activities also supported further growth and expansion of loans, investments, and overall resources,” he added.

Last year, the financial system’s total resources stood at P28.806 trillion, up by 9.3% from a year ago. — Luisa Maria Jacinta C. Jocson