The Philippine banking system has increased its resilience to adverse shocks by strengthening its capital position and funding structure, a route towards financial stability. This has been reinforced with the implementation of Basel III capital framework effective
The System s performance has been improving steadily since the 1997 Asian Financial Crisis. Total assets of banks, which represent 81.3 percent of the total resources of the financial system, grew year-on-year by 23.7 percent to
Net profit grew by 18.5 percent year-on-year. Profitability though has shifted towards trading gains in 2013 on improved market conditions and investor sentiment. Nonetheless, income from lending still captures 60.9 percent of total operating income as lending remains the primary business model of Philippine banks. Cost efficiency likewise improved as cost-to-income ratio eased to 60.6 percent from 63.2 percent last year.
Banks remained adequately capitalized against risks as capital adequacy ratio stood at 17.5 percent on solo and 18.6 percent on consolidated bases, respectively, as of
At end-2013, the country has 673 operating banks, 9,262 bank branches, 14,157 ATMS, 465 microfinance banking offices, and 250 banks with e-banking services (i.e., internet, mobile, phone, e-wallet and remittance cards). The BSP continues to widen financial access points under a defined financial inclusion strategy.
Entities with quasi-banking functions and other institutions under BSP jurisdiction also performed generally well during the year. Key performance indicators for these NBFIs reflected strong balance sheets and sustained profitability.
Notwithstanding the solid performance of the financial system in 2013, the BSP continues to closely monitor potential pressure points. This is in line with the BSP s objective of promoting greater financial stability.
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