THE Philippine financial system remained resilient in the second half of 2025, providing steady support to the economy.
The Bangko Sentral ng Pilipinas (BSP)’s Second Semester 2025 Report on the Philippine Financial System shows that both the banking sector and the non-banking sector supervised by the BSP performed favorably during the period.
“Banks and non-bank financial institutions play a vital role in mobilizing funds for different economic activities,” BSP Governor Eli M. Remolona, Jr. said. “The BSP remains committed to fostering a regulatory environment that supports its continued growth and resilience while advancing the interests of Filipino financial consumers,” he added.
The total assets of banks in the country increased by 8.9 percent to P29.9 trillion as of December 2025. While slightly slower than the previous year’s growth of 9.0 percent, the latest growth in assets continued to outpace the expansion of the Philippine economy.
As banks maintained healthy indicators, public confidence in the banking sector remained solid, with deposits reaching ₱21.9 trillion as of the end of December 2025, up 7.4 percent year-over-year.
Bank lending expanded by 11.7 percent to ₱17.1 trillion, supporting household consumption and business investments, including priority and underserved sectors.
Asset quality is manageable, coupled with banks’ prudent lending practices. The non-performing loan (NPL) ratio, or the proportion of bad loans to total loans, stood at 3.1 percent as of end-December 2025, complemented by an adequate loan-loss coverage ratio of 97.2 percent.
Capital and liquidity positions are strong. As of end-December 2025, the “solo” capital adequacy ratio (CAR) was recorded at 15.8 percent, while the “consolidated” CAR, which covers banks and their subsidiaries, was at 16.2 percent, both exceeding the BSP’s 10.0-percent minimum requirement.
Liquidity indicators were also above the 100.0-percent regulatory minimum, with universal and commercial banks’ “solo” liquidity coverage ratio at 172.3 percent and “solo” net stable funding ratio at 132.7 percent.
Alongside banks, BSP-supervised non-bank financial institutions also continued to broaden access to financial services during the period. Trust and foreign currency deposit unit operations expanded credit and asset management services.
The report also highlights the BSP’s ongoing reforms to strengthen governance, enhance supervisory and digital capabilities, and promote inclusive and sustainable finance. PR
