Bank deposits grow 11% to P9.67 T

MANILA, Philippines - More Filipinos continue to entrust their funds with banks as deposits booked a double digit increase in the first half of the year amid the strong economic growth.

Data from the Bangko Sentral ng Pilipinas (BSP) showed bank deposits grew 11.4 percent to P9.67 trillion from January to August this year compared with P8.68 trillion in the same period last year.

Peso deposits rose 12 percent to P8.01 trillion from P7.15 trillion while foreign currency deposits owned by residents went up 8.5 percent to P1.66 trillion from P1.53 trillion.

Earlier, the central bank reported the total resources of Philippine banks went up 11.7 percent to P12.84 trillion in the first half of the year from a year-ago level of P11.5 million.

The total resources of big banks or universal and commercial banks increased by 12 percent to P11.57 trillion from P10.33 trillion while that of mid-sized banks or thrift banks grew 10.5 percent to P1.06 trillion from P964.7 billion.

BSP Deputy Governor Diwa Guinigundo said the country’s banking system continues to be resilient in supporting the economy’s long-term growth.

This, he said, was evident in the banks’ balance sheets that are marked in steady growth in assets and deposits.

“The Philippine banking system remained sound, resilient and capable of supporting the expanding economy, marked by a continued increase in assets, lending, and deposits, and with capital adequacy ratios comfortably above the BSP’s prescribed levels and international norms,” he added.

The country’s gross domestic product (GDP) growth accelerated to seven percent in the second quarter from 6.8 percent in the first quarter amid the strong boost from election related spending.

This brought the country’s GDP expansion to 6.9 percent in the first half of the year from 5.5 percent in the same period last year.

Deposits continue to be the major source of resources of Philippine banks. As a percent of GDP, total bank resources stood at 93 percent.

The continued rise in resources including deposits, profits, and retained earnings indicate that banks have the ability to service funding needs of corporate and household clients.

At the same time, this shows banks have enough to act as a buffer against any external shocks.